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01 Jul 2015

Workplace pensions most reliable way to fund retirement, says report

With much confusion surrounding pensions and savings, a new report from the Office for National Statistics (ONS) has found that most investors consider workplace pensions the safest bet for securing a decent pension pot, The Morning Star writes.

According to the ONS´ recent Wealth and Assets report, more and more savers are realising that long-term saving is the best way to save for their retirement years - and most financial experts would agree. That´s why the continuation of the auto-enrolment scheme is being so welcomed by savers and pension providers alike, it being one of the most efficient and reliable ways to save.

Launched in October 2012, the government´s initiative is expected to help some 10 million UK workers to save into a pension scheme by 2018. Each contribution made by the saver is matched by their employer, and then supported by additional tax relief from HM Revenue and Customs.

The report also found that UK savers felt investing in property was a safe option for funding their retirement, but warns that the property market is not without risk and can be vulnerable to ups and downs, much like the stock market.

With the average Brit retiring between the ages of 65 and 69 and living until around 82 years of age, retirees are expected to live off their pension savings for up to twenty years, if not more.

Ros Altmann, Cameron´s newly appointed pensions minister, is set to review the retirement age within the next two years. Current plans are to increase the female retirement age to 65 by November 2018, and to raise both male and female retirement ages to 66 by October 2020, with a further increase to 68 in the subsequent years.

“Rising longevity means that successive generations are spending longer in retirement,” she told the House of Lords. “I want the review to consider not only rising life expectancy but also wider social, occupational and gender factors.”

Copyright M2 Bespoke 2015

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