How does the government’s Pension Wise guidance service work?


If you reach 55 after April 5th 2015, you may qualify for free and impartial ‘guidance’ on what you can do with your pension from a service called Pension Wise.  You will be able to get guidance by phone, online or – depending where you live – face to face.

Q. What is Pension Wise and what is free guidance?

A. It’s not the same as independent financial advice, but it is designed to give people who are about to retire, impartial information about what they can do with their pensions. It will be offered online, over the phone and through face-to-face meetings by a government-funded service called Pension Wise.

SAVVY TIP: This won’t be the same as independent financial advice as the adviser won’t tell you which company’s retirement product is the best for you.

Q. Who can get free guidance?

A. If you have a defined contribution pension from work (a workplace pension ‘pot’ type of pension), a personal or a stakeholder pension, you will be able to get some guidance from Pension Wise. You can also get guidance if you have an AVC (additional voluntary contribution, which lets you pay extra money into your pension) depending on the type you have.

Some salary-related pension schemes let you pay extra money into your pension through added years (where you buy extra years’ of membership of the pension). It may be called an ‘added years AVC’. In that case you wouldn’t qualify for guidance from Pension Wise, but if you have a free standing AVC or an AVC that is invested, you qualify for guidance.

Q. How can I get guidance?

A. You can use the Pension Wise website to find out more or, if you want to get a telephone appointment, you can ring 0300 330 1001.

The Pension Wise website has a range of information, including what you can do with your pension pot.

However, find out more on the Pension Wise website. The phone guidance sessions will be with The Pensions Advisory Service and face-to-face sessions will be provided by Citizens Advice. Be aware that only a limited number of Citizens Advice Bureau will be offering guidance

Q. Will I be phoned by Pension Wise and offered a review when I’ve retired?

A. No. If you want to get guidance through this government scheme, you must get in touch with Pension Wise. It’s one of the ways that you’ll be able to know if you are dealing with a genuine Pension Wise adviser. There are – unfortunately – a number of rogues who have been contacting people and telling them they’re eligible for a government review.

This isn’t entirely inaccurate as the government has provided the funding for Pension Wise. But, if someone calls you saying that you qualify for a government review, it could be a pushy salesman or woman at best or a rogue at worst.

SAVVY TIP: Don’t deal with anyone who calls you out of the blue. My view is that if they are going to cold call you they are probably going to put you under pressure to do something with your pension. If you want free guidance, contact Pension Wise. If you want financial advice, go on the Unbiased, Vouchedfor or the Institute of Financial Planning website.

Related articles:

What are people doing with their pensions since pension freedoms?

The pros and cons of transferring a final salary pension

What is an annuity and how does it pay an income in retirement?

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