The Government has launched a consultation on the new pensions advice allowance, which will permit those nearing retirement to withdraw up to £500 from their pension pots tax-free to put towards the cost of regulated financial advice.
This will enable individuals to receive advice on the various financial products that may contribute towards their retirement income, such as savings within an ISA and multiple pension pots.
The public consultation seeks views on the specific details in regards to the allowance, such as the eligibility age and how to promote the scheme effectively.
It also seeks input as to whether to allow multiple uses of the allowance in order to permit individuals to receive advice at different stages of retirement.
Simon Kirby, Economic Secretary to the Treasury, commented: ‘Pensions and savings decisions are some of the most important a person will make during their lifetime.
‘It is therefore vital that people can access the financial help they need and feel confident choosing the support that works for them in their retirement.
‘I look forward to the industry engaging with the pensions advice allowance consultation, and taking this opportunity to tell us how the allowance could best meet the needs of both consumers and firms.’
However, experts have warned that the allowance, which is set to come into force from April 2017, may not be available to all, and that £500 would not be enough to cover the cost of quality advice.
The consultation closes on 26 October.