FINALLY! Rip-off charges to access pension cash to be capped

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Cloying so-called early exit charges from some providers accept been acting as a barrier to over 55s wanting to make the most of superannuation reforms introduced last year.

But from March 31, 2017, social security firms will not be able to levy more than one per cent of the pot’s value in prices, while charges already below the cap will not be allowed to increase after this go steady with.

Savers who enter personal pension schemes from April next year thinks fitting not be subject to any charges at all.

However, critics said all charges should be barrel scrapped.

Tom Selby, senior analyst at AJ Bell, said: “The cap on early bid adieu fees for pensions, including occu tional schemes, is a start but one per cent of a £100,000 dismiss is still a £1,000 charge for accessing your own savings.

“The pension freedoms are now nicely established yet there are still thousands of people that are going to receive to y thousands of pounds to access them.

“We hope the authorities continue to visual display unit the cap to assess whether it should be lower or even abolished if early retreat penalties continue to prevent people utilising the new flexible pension negates.”

Nathan Long, a senior pension analyst at Hargreaves Lansdown, added: “It persists important to be vigilant when transferring pensions, as one per cent could unmoving be a chunky sum to lose from your pension at the point of retirement.”

Christopher Woolard, supervision director of strategy and competition at the FCA said: “People eligible for the Government’s superannuation reforms should feel able to access them as they crave.

“The one per cent cap on early exit charges for existing pensions, and the 0 per cent cap for new bargains, will mean that current and future savers will not be deterred by these assigns from accessing their pension pots.”

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