Almost half of savers who chose to cash in their pensions as part of the biggest reforms in a century will be making an 'irrational decision', according a financial watchdog. On April 6, over-55s will be allowed to cash in all or part of their pension, rather than being forced to buy a guaranteed monthly income for life. The Treasury has pledged to offer appointments to help them decide what to do with their money. Next month over-55s will be allowed to cash in all or part of their pension - but experts are predicting chaos when the changes come in as the Treasury advice service is not yet up and running . However, the Financial Conduct Authority is warning that up to 40 per cent of savers who cash in their pensions will be 'irreversibly worse off'. And in some cases they even say people who cash in will be left destitute as they enter old age. Christopher Woolard, director of strategy and competition at the FCA, told the Telegraph: 'In many cases it may not be in the member's best interests. 'We need to ensure that those who are considering it are fully aware of the potential benefits they are giving up.' The warning comes amid concern that some savers still cannot book an appointment with the Government’s pension guidance service – despite just one month to go before the reforms. Insurance firms say they are being contacted by floods of frustrated customers who are unable to even book a face-to-face or telephone appointment . Experts are predicting chaos when the changes come in, with the ‘Pension Wise’ service still without a telephone number or booking service. Insurance firms say they are being contacted by floods of frustrated customers who are unable to even book a face-to-face or telephone appointment . Richard Jones, of Scottish Widows, said: ‘I am concerned the Government is over-reliant on its website. Many people will want face-to-face or telephone guidance. ‘I am worried they are not going to be able to cope with the initial surge. ‘We have had customers calling since the start of the year who want to talk to the Government about what they want to do in April but they can’t. Thousands of customers who are trying to figure out what to do and cannot even book an appointment yet.’ Scottish Widows, which corners 10 per cent of the retirement market, has recruited an extra 400 staff to deal with queries about the pension reforms and expressed their dismay that the Government had hired fewer than that themselves. Only 300 official experts will be on hand to help hundreds of thousands of savers make the right decisions about their pensions when major reforms kick in. Many will have little or no previous expertise in pensions, which could lead to huge delays and many missing out on proper guidance. Job adverts being placed by Citizen’s Advice have revealed that, while it essential that applicants have good numerical and communication skills, no pensions knowledge is required.
On April 6 over-55s will be allowed to cash in all or part of their pension . But a financial watchdog says cashing in could be an 'irrational decision'
Financial Conduct Authority says some will be 'irreversibly worse off'
Adds in some cases people will become destitute as the enter old age . Treasury offering appointments to help savers decide what to do . But 'Pension Wise' service does not even have working telephone number . Savers are unable to book an appointment - with just one month to go .