By James Walker, of Resolver
People in the UK aren’t saving enough for retirement and are increasingly worried about having enough money when they do according to Resolver, the UK’s largest free complaint website.
The survey of over 10,000 of Resolver’s users also reveals that large numbers of people are unsure how their occupational or personal pension works.
The results of the survey reveal:
Less than a third of people felt they were saving enough for retirement, while half didn’t know if they were saving enough (25%) or weren’t saving anything (24%).Four in ten people admitted to not knowing enough or having a very limited understanding of their work or personal pension works.35% of people were worried that they wouldn’t have enough money when they retired, while one in ten had no savings at all.Only 25% of people were able to identify how much the maximum current state pension is. (£159.55).Of those who had retired, 17% purchased an annuity with the same firm that held their pension. And while just under 40% of respondents took independent financial advice, 15% withdrew their whole pension.
Half of all respondents said they felt they knew where to go to get advice about their pension, but millions of people across the UK are still unsure where to turn.
James Walker, found of Resolver says:
"Pensions are one of the most important – and biggest – investments we’ll make in our lives. Yet our survey shows that millions of people simply don’t understand how they work or where to turn for help.
"It’s time for pensions to be demystified. From ditching complex terms and simplifying language to encouraging people to seek help. Admitting that we don’t understand how such an important investment works is the first step.
"It’s also becoming increasingly clear that people don’t understand how fees and charges on their pensions are applied or if they’re fair – and their rights to complain or change provider if they’re unhappy."
Michelle Cracknell from The Pensions Advisory Service says:
"People often put decisions about their pension in the “too hard” box. Whilst pension providers are trying to improve their communications, the volume of paper received is very off-putting and people often don’t know where to get started. In addition, there are many different types of pensions with different rules applying, depending on when they were taken out. It can therefore be difficult for people to understand how their pension works."
Resolver is encouraging people to:
Find out more about their existing pensions and encourage pension providers to explain in simple terms how pension pots work. Resolver’s ultra-simple guide to pensions is here:https://www.resolver.co.uk/news/resolvers-ultra-simple-introduction-to-pensionsMake a complaint if you’re unhappy with the way your pension has been sold administered or mis-managed. Work/state: https://www.resolver.co.uk/rights-guide/workplace-state-pensions Personal/private:https://www.resolver.co.uk/rights-guide/private-personal-pensionsSpeak to The Pensions Advisory Service (TPAS) https://www.pensionsadvisoryservice.org.uk for help finding a missing pension scheme to finding out how much you can save each year tax-free.Speak to Pensionwise you’re approaching retirement age with a defined contribution (final salary) pension pot and want to know about your retirement options https://www.pensionwise.gov.uk/en