In a surprising result from a HSBC survey, 9 out of 10 adults acknowledged that they will probably not survive financially on State pension benefits but less than 25% are actually saving more than £50pm in private pension arrangements.
Our view
This again reflects the general apathy people have towards their own financial provision. Our view is that this is affected by lack of consumer education on finance. Hence us constructing these sites and the Government introducing Finance in the National Curriculum within schools. It is also the fact the Government are still debating the position on retirement flexibility.
The fact that someone can save in a pension, get tax relief and get some form of pension credit when they retire is not enough. People like the security of access and flexibility. Access is poor, annuity rates are poor and willingness to save is low.
More action on flexibility to access monies pre and post retirement is the only answer. This will actively encourage people to save if they have access to at least some of their investment in times of difficulty. Resticting access and then forcing people to purchase an annuity, perhaps when rates are not so good, is a large barrier to mass saving.
We still like the Conservative back bench Private Members Bill approach to flexibility which is doomed to fail even though it has yet again just got through another reading at the House. The Government will never let something pass that is not their idea, which is a shame as we believe this is actually a good idea with some tweaks.