Only around a third (32 per cent) of people aged over 55 who have accessed their pension use a financial adviser for help with financial planning, research from Canada Life has revealed.

When asked the reasons for not using an adviser, 44 per cent of respondents said that it was because they had confidence that they know what they were doing.

It found that men (53 per cent) felt more confident in making financial decisions without an adviser than women (31 per cent).

The second most common reason cited by people who had flexibly accessed their pension was that they felt their pension pot was not big enough to warrant an adviser, with 26 per cent naming it as the main factor.

A further 22 per cent were put off by the cost of advice and 20 per cent of respondents did not seek advice due to trust issues.

Canada Life found that men (25 per cent) were less trusting than women (12 per cent).

Pension Wise, which is now part of the Money and Pensions Service, was mentioned by 20 per cent of people as a source of advice, while only 6 per cent cited online resources as a source.

The research also revealed that those who use a financial adviser were twice as likely to withdraw a cash lump sum and buy an annuity with the balance of their pension compared to those who didn’t get advice – 37 per cent compared to 18 per cent.

Commenting on the findings, Canada Life technical director, Andrew Tully, said: “A significant majority of people exercising their pension freedoms have turned their back on financial advice. We’ve exposed some pretty entrenched views on the value of financial advice, but many people are seemingly making complex decisions and potentially irreversible financial decisions unaided.

“I’d like to turn the debate on its head. Rather than talk about the cost of advice, we should instead promote the idea that people can’t afford not to get advice. It can often be just as cost effective, or even better value paying for advice, than not.

“Advice is much more likely to create better consumer outcomes than trying to go it alone with a DIY retirement.”

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