• Employees need to understand the basic concepts of retirement and planning, but should also appreciate that this is a complex area and a trained specialist can assist.
• Research shows that the average person does not understand the value that an adviser can bring and the cost of advice versus other services they may need.
• Brian Smyth, Harrogate-based head of Ascot Lloyd Benefit Solutions, comments on government plans to allow people to use £500 from their pension for retirement advice.

The £500 Pensions Advice Allowance is likely to pay for two hours of financial advice work in many cases. The return will be improved if the individual comes fully prepared. The more difficult question is whether disinvesting £500 from your pension is more cost effective than finding that amount of money from other savings. In many ways it would be more cost effective for employers to pay a fee to an adviser to give a group presentation to a number of staff first and then agree the Pensions Advice Allowance with those who want more information and planning.

For many, retirement is a long way away and employees often do not begin planning or seek advice until it is too late to make any meaningful difference. But the biggest barrier to pension saving is its poor reputation. The government and the industry need to address this to make the need for advice attractive. Buying a house or saving into an ISA, both of which create wealth, and are readily understood. Retirement planning needs to be as easy to understand and employers, as a trusted source of employee information, need to play a greater role in driving this education.