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Why advice isn't just a side-order

Updated 24 November 2022

3min read

Nick Green
Financial Journalist

Many pension providers are now insisting that scheme members take advice before accessing their benefits. More red tape? Far from it. Here’s why advice at retirement is not so much ‘optional extra’ as ‘must have’.


Some phrases to make your blood boil. Ready? Booking fee. Processing charge. Would you like to reserve seats? Ticket postage. Ticket postage for emailed tickets (really?). Whether you’re booking travel or entertainment, you’ll have come across these ‘optional extras’, which aren’t optional and certainly don’t add much extra, except to the profits of the company you’re booking with.

Restaurants aren’t much better. How much to tip the waiter? How much to add in service charge? Wait – are those two separate things? You can’t tell. Should you even be paying separately for them to bring the food to your table? It’s not as if they’d want you licking it out of the saucepans.

Then there are the extras that are just irritating. Car insurance with added misfuelling cover, hmm… You’ve never even touched the diesel pump and never will, but you keep the cover because it takes too long to get through on the phone to cancel it.

But after that come the add-ons you really do need to have. We might complain about the cost of insurance itself, but no sensible person drives without car insurance, or goes abroad without travel insurance. We’ve learned to factor insurance costs into much of what we do.

Other ‘extras’ you hardly notice, they’re so fundamental. If you’re buying a house, you’ll always hire a solicitor to ensure the sale is fully legal. In theory you could do the document chasing and checking yourself, but who has the time? (Or the indemnity cover?) Solicitor’s costs are just part of moving home.

We’ve come to accept that in some situations, we need to pay for certain services to achieve what we want. But the situation that takes many people by surprise is retirement.

Why advice is the new must-have

You might think, having saved into a pension all your life, that it’s just a matter of taking that money out again, ta very much. But even in the old days things were never that simple, and thanks to pension freedom the options are now far from straightforward.

The decisions you now face at retirement are many, the alternatives hard to weigh against each other, the details frequently complex and confusing, and the consequences of a mistake potentially irreversible. You’re making a choice about most or all of your life savings, trying to arrange them in such a way that they last you for the rest of your life, while enabling you to do some of the things you always dreamed of doing in retirement. It’s an extraordinarily delicate balancing act.

Cast your mind back to that house-buying scenario. Imagine it’s the only home you’ll ever be able to buy, and you’re sinking your every last penny into it. Now, do you pay a solicitor about a thousand pounds to make sure the sale is valid, or do you save on that cost and hope for the best?

We all know the answer to that. And what’s true of home buying is now equally true of retirement. It’s the last and biggest move of your life, and one of the most complicated too. That’s why increasing numbers of pensioners are now recognising the importance of seeking independent financial advice not just at the point of retirement, but in the years leading up to it too.

It’s likely that in years to come, consulting a financial adviser to sort out your pension will be considered as natural a step as instructing a solicitor to oversee your house purchase. Unfortunately, even they might not be able to tell you how much you should tip the waiter.

To find out how a financial adviser could help improve your income and protect you from risks in retirement, book a free pension check with an adviser near you.


About the author
Nick Green is a financial journalist writing for Unbiased.co.uk, the site that has helped over 10 million people find financial, business and legal advice. Nick has been writing professionally on money and business topics for over 15 years, and has previously written for leading accountancy firms PKF and BDO.