FCA warns about accessing benefits without taking financial advice
The Financial Conduct Authority (FCA) has warned that an increasing number of members are accessing their pension benefits early without taking financial advice. They have identified that three quarters of all pension pots accessed were done so by members under the age of 65.
It has been recognised that this issue has been developing since "pension freedoms" were introduced in 2015 which allowed members with defined contribution benefits to access them from age 55.
The FCA also identified that over 50% of the money being withdrawn is then re-invested into other savings and investment funds, consequently resulting in members paying additional tax, unnecessarily.
The FCA has announced that it is considering additional protection for those who access their benefits early.
