Can I stop paying ongoing fees to my financial adviser?
I have been taking my private pension for three years now with the help of a financial adviser who transferred it to a drawdown pension. I paid him a percentage of my 400,000 pot which I was happy to do, but I'm happy with my pension provider and my returns and I don't foresee it changing anytime soon. However, I am still paying my financial adviser 4,000 pounds a year. Thanks for any advice. SCROLL DOWN TO FIND OUT HOW TO ASK STEVE YOUR PENSION QUESTION  Steve Webb replies: Its good that youve had a positive experience with financial advice around your pension transfer but also entirely proper to challenge whether you are getting good value when it comes to ongoing advice. Whilst I think there is a case for ongoing advice, especially with a relatively large pension pot, any fee needs to be justified and there are things you can do if you are not satisfied. Starting with your pension transfer, as you know, for any transfer out of a final salary type pension worth more than 30,000, financial advice about the transfer is mandatory, though it is not if you are moving a pot from a defined contribution work scheme. There is no legal requirement to take ongoing financial advice once you have transferred. But there are some reasons why it might still be worth doing. The first is that you are now in a world where all the decisions about how your money is invested are down to you. Steve Webb: Find out how to ask the former Pensions Minister a question about your retirement savings in the box below  At the very least, your investments need to be reviewed periodically, as the right answer for someone starting to draw down at sixty is unlikely to be the right answer for someone well through retirement. Second, not only do your needs change but also markets and economic conditions change. You only have to think back a decade to realise that investment returns can change very quickly, and a financial adviser can help to make sure that your current investment mix is the best fit for current (and expected) market conditions. Something else which changes is the tax system. In recent years we have seen big changes to pension tax relief and there are regular rumours of further changes to come which could make the system less generous. A good adviser will keep abreast of the latest changes and will help to make sure you know how best to respond. Another reason for taking financial advice is that you need to think about much more than just your pension pot. You need to consider things like the needs of other family members (such as a partner if you were to die, or any children who you want to inherit some of your wealth). You need to think about your tax position, including any inheritance tax liability. You may also want to look at any wealth tied up in the value of your home and also the possibility of future long-term care costs. Defined contribution pensions take contributions from both employer and employee and invest them to provide a pot of money at retirement. Unless you work in the public sector, they have now mostly replaced more generous gold-plated defined benefit - or final salary - pensions, which provide a guaranteed income after retirement until you die. Defined contribution pensions are stingier and savers bear the investment risk, rather than employers. In short, a good financial adviser will be giving you holistic advice, not just on how you invest your transferred pension pot but on your wider financial circumstances, on the latest changes in the economy and in the tax system, and on how best to provide for your wider family. If you cancel all advice and only ask for it when you think you need it, it is possible you may fail to seek advice when you need it most. But having said all of that, there is no reason to accept a particular fee level without challenge. Whilst 1 per cent is a nice round number, there arent many things for which you would pay 4,000 without asking a lot of questions first! Assuming you are with an independent financial adviser then it is highly unlikely that there are any contractual reasons why you could not end the retainer arrangement altogether if you wished. At the very least you could ask your IFA to set out what work he has done for you in the last year, including how many hours he has spent, and say that you would like a reduced charge for the coming year. Whilst 1 per cent is a nice round number, there arent many things for which you would pay 4,000 without asking a lot of questions first! The Financial Conduct Authority, which oversees financial advice, expects advisers to be able to justify ongoing charges of this sort and not just rely on inertia. The situation is more complex if you have signed up with what is called a vertically integrated adviser who has sold you financial products which only their firm offers. It is possible that when you signed up with them you committed to ongoing advice as part of the deal. If you say you dont want advice from them any more you may have to move your money to alternative investments and there could well be exit penalties. You should obviously research this carefully before you make any decisions. Find out what you should ask for and expect to get... and how much it might cost here. Many financial advisers now use in-house or tied funds and platforms when they arrange pension drawdown for clients. So, anyone who has not yet transferred a pension should also research the implications of ongoing fees and exit fees thoroughly when choosing an adviser. There are financial advisers who will set up pension drawdown portfolios that can be moved easily, or accessed by other advisers in future. It can also be tricky to switch off advice costs if you took out a product before a major rule change in 2012. Prior to this date financial advice was often free up front to the member but paid for out of deductions over the life of the product. As a result, there can be exit penalties on some products to stop people taking their money before the cost of the initial advice has been recouped. I dont think this applies in your situation but could be a reason why some people might face a barrier to switching off advice charges. In short, I think there is a good case for ongoing advice because you dont know what you dont know. But you are quite right to ensure you are getting value for money and it may well be that you could get similar ongoing advice for less than you are currently paying.