Whispers have been on the up recently regarding the maximum charges that can be levied on Stakeholder Pensions.
Speculation is rife that the Government will look to increase the 1% maximum charge to 1.5%. This means that consumers will be 0.5% a year worse off but raising the charge may help the Government narrow the savings gap.
Not all consumers like to pay fees for advice. However, with Stakeholder Pensions, if advice is needed then generally fees have to be paid. This is because the levels of commission paid by pension providers to the intermediary advising on the pension are very low.
As the advice given has to be justified and the adviser is then liable for the advice he or she gave, taking commission is not feasible.
Problems have arisen where consumers know they should plan for retirement but do not want to pay the cost of advice. They then get to the point where they can't decide what to do and it all goes on the 'too difficult shelf' until it's too late.
For more on pensions in general visit the Pensions Adviser.com.
For more on Stakeholder pensions visit the Stakeholder Cafe.com.