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06 Jul 2016

Pension rule change could benefit 11 million people - if they knew about it

New research has found that up to 11.4 million people in the UK would be able to boost their pension savings if they knew more about a rule change that came into force last year, City AM reports.

Insurance and pensions management company Aegon recently conducted a survey of 4,000 people. Of this number, one third (33%) were completely unaware of the pension freedoms that were introduced last year, allowing savers over the age of 55 to access their pension pots without purchasing annuity beforehand.

A further 32% knew about the changes, but were unsure exactly how they would impact their retirement savings.

With approximately 15% of savers having increased their pension contributions in light of the new pension freedoms, according to Aegon´s research, it´s estimated that 11.4 million people would feel compelled to boost their pension savings if they could access more information about the rules.

Commenting on the findings, Aegon pensions director Steven Cameron noted that their research clearly shows “people who know about the pension freedoms exhibit positive behaviours towards their retirement savings, saving more and actively taking steps to make a change or to review their retirement plans.”

The freedoms are even encouraging those who are decades away from retirement to improve their savings habits, he added.

The report did also highlight some concerns among those who know about the freedoms, however. Nearly one in five (19%) of respondents were worried about taking out too much money too soon, while over a quarter (28%) didn´t know where to go for help and advice on the matter.

Earlier Aegon research found that just 12% of UK adults are set to achieve their dream retirement income and lifestyle - although this was up 7% from the previous year.

Copyright M2 Bespoke 2016

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