Why not to rely on online guidance for pension planning

4 November Reading Time: 4 minutes

The internet has given people the keys to an unthinkable amount of information about every subject under the sun. Finance is no exception. Within seconds, retirement planners can access online resources offering guidance on savings, spending, investments, and more. 

However, while quick and convenient, when it comes to pension planning, going online for information and advice has its drawbacks. In some cases, it can be dangerous. 

High volumes of online misinformation, not to mention scams and mis-sold products and services, can lead retirement planners to make damaging decisions regarding their finances. 

Using online resources

Pension planning can, at times, feel overwhelming. So, with all the different pensions products and providers available, being able to carry out one’s own online research is a big advantage. 

Registered UK charities, for instance, can be a useful tool for obtaining clear, unbiased information and advice about pensions and retirement planning, as well as more general personal finance topics and issues. Likewise, campaigns such as the ongoing Pension Awareness Week – which takes place this week and encourages Britons to engage with their pension – are useful as they result in numerous articles with important advice. 

These resources are incredibly beneficial in picking up pension basics; however, they have their limitations. People have different circumstances and retirement goals, so a pension plan that works for one may not suit another. 

Further, recent years have seen an increase in misinformation on certain websites or social media platforms that could, at best, mislead pension planners towards a financial plan that does not suit them or, at worst, result in them becoming victims of online scams.

So, we must not accept online resources as absolute facts. We must question the validity of the source and, wherever possible, compare multiple websites and information providers to ensure consistency in what they say. But even with a diligent approach, the limitations of online resources must be recognised. 

Developing a strong pension plan

Without a doubt, a lot of work needs to be done to improve and simplify the process of accessing pension information. 

The government’s long-awaited Pensions Dashboards will be a welcome improvement to pension planning. The programme is designed to allow pension planners to see all their retirement savings in one place and provide simple information about their multiple pension savings in the hopes of empowering people with more convenient access to their own financial information and helping them to make better decisions.

That said, accessing such a plethora of information can be overwhelming and confusing for some. So, savers would be wise to seek independent financial advice to help them make sense of their pension savings.

Unlike online guidance, a financial adviser will go beyond providing basic pension information. Instead, they will help clients shape their retirement strategy by assessing their financial situation, understanding what they want from their retirement, and then suggesting the right products that will align those two points. 

It is crucial that savers engage with their pension and using online support to inform themselves on different types of pensions, investments, and retirement strategies should generally be encouraged. However, it is wise to treat search engines as the start of the journey, and not the provider of ready-made advice. 

There is no substitute for independent financial advice when it comes to the benefits acquired from creating a pension plan that works based on an individual’s needs and goals. And, as we noted in our last blog, independent financial advice is not just for the wealthy – it is available and worthwhile for all people planning their retirement. 


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