Pensions boost with help from IFA
Revised rules around pension freedoms has boosted business for Cramlington-based Explore Wealth Management.
The Independent Financial Adviser (IFA) has helped more than 100 clients to benefit from the new regulations.
Designed to provide people with more flexibility to decide how and when they access their private pension funds, new legislation enables over 55s to withdraw as much of their pension pot as they like, when they like.
Stephen Sumner, managing director at Explore Wealth Management, said: “The new more relaxed rules around private pension schemes have proved extremely popular with the majority of our customers.
“However, we would advise anyone thinking about taking money from their pension pot to first seek advice from an accredited IFA, as there are a number of different ways of doing this, some of which are more tax-efficient than others.
“With help from a financial adviser, you can simply close your pension scheme altogether and withdraw all of the cash as a lump sum, assuming you haven’t already accessed your pension funds.
“Alternatively, you can take smaller amounts from your pension pot to help subsidise some of those larger purchases – like paying off a mortgage, or buying a car.
“The first 25 per cent of any funds you withdraw from your pension pot will usually be tax-free. The remaining 75 per cent, however, will be subject to income tax at your highest income tax rate, so you need to ensure you don’t unwittingly pay too much tax.”