A leading Yorkshire lawyer has warned pensioners to be wary of negligent financial advice, following “Pension Freedom Day”.
New pension rules came into force in April, which mean that over 55s who have their pension pot in a defined contribution scheme can access 100 per cent of their fund straight away. The Treasury estimated that about £350bn of funds would be accessible.
The headlines suggested a spending bonanza but Darren Morgan, of York-based Langleys Solicitors, said many savers will instead use the new-found flexibility to make loans or gifts to their children or re-invest elsewhere.
However, he warned of a growing risk that individuals may fall foul of negligence by unscrupulous professional advisers. “There is the possibility that the risk profile of the investment suggested by an advisor might not match the risk profile of the investor,” he said.
“People should be wary of advisors who fail to provide a satisfactory explanation about the investment itself and its risk rating. The advisor must take account of the investor’s needs and financial situation.”
Darren added that those who feel they have been a victim of negligent financial advice should seek immediate legal assistance as options are available to pursue compensation.