Almost two thirds of over 50s say they would be unlikely to use their pension savings to pay for advice, according to new research from Retirement Advantage.
Just 15 per cent of over 50s said they were likely to use their pension to pay for advice, with 62 per cent unlikely, 14 per cent neither likely or unlikely and 8 per cent not having an opinion.
The Government is proposing to allow savers to draw up to £500 from their DC pension pot tax free to pay for advice, but industry figures are questioning whether people will take advantage of this facility.
The research also found that amongst people who are not planning to use a financial adviser, 38 per cent are put off by the cost of advice, and an identical proportion are put off because of their lack of trust in advisers.
Retirement Advantage pensions technical director Andrew Tully says: “While it sounds like a good idea to let people use their pension savings to pay for advice, it appears not only are people unlikely to take up the offer, but £500 won’t actually go that far.
“Cost is clearly still a big issue when you ask people what the barriers are to seeking advice, alongside trust. On a positive note it is good to see government supporting advice and recognising the real value in people getting help and advice at retirement. The trick will now be to create a market which can service a wider range of consumers cost-effectively and also evidence the value of the advice being provided.”