Following on from the annuity review ‘Modernising Annuities’, the Government are considering subsidising the cost of advice for soon to be pensioners. The industry regulator, The Financial Services Authority is constantly being told that people are not getting the best advice they can when purchasing an annuity with their pension funds.
There are two ways of subsidy being considered. The first is for a levy on insurance companies which would then provide people with an advice voucher, to spend on independent advice. The figure being banded around is £350.
The second way is for the levy to be used to fund a charitable trust, giving free advice to people as they get closer to retirement.
For more on pensions visit Pensions Adviser.com.
Learn about the different types of annuity.