Brexit has delayed the PAA but it needs to be brought back to help retirees withdraw from their pension to spend on advice
Motivating people to take advice on their financial situation is something us Brits have always struggled with. Our stiff upper lip is something to be proud of in certain circumstances but, when it comes to money, being stubborn can cause real problems.
For many, affording financial advice is also an issue. That is why I was pleased to hear the Government was launching the Pensions Advice Allowance in order to give retirees the chance to withdraw up to £1,500 tax-free from their pension pots to spend on advice.
The PAA has now been delayed, as the Government shifts its focus to dealing with Brexit and the general election, but I do hope it returns.
It is key that we change the narrative on advice and make sure every older person is aware of their financial options.
If the PAA does make a comeback, as I imagine it will do if the Tories sweep to victory, as they are expected to, then I hope it will go some way to normalising advice for the older cohort. In this case, advisers must be prepared to see an even bigger influx of customers interested in knowing about their options, including equity release.
Of course, there is always the chance the PAA will be kicked into the long grass. In preparation for this eventuality, advisers’ main goal now must be to continue providing
the best advice possible and spreading the word on equity release.
Only by making financial advice a real normality for older people will we help them enjoy the retirement they deserve. So let’s hope the PAA returns and that it is just the start.
Andrea Rozario is chief corporate officer at Bower Retirement