Concerns raised on private pensions
22 January 2004
Concerns have been raised about the dwindling number of people that are making provisions for their retirement by having a pension.
With the difficulty the pension industry found itself in recently, more people in Britain are looking at other methods of investing their money for their retirement, with real estate being the most popular alternative.
Speaking on BBC Two's 'Working Lunch', Andy Dear of Mercer Oliver and Wyman, said: "The consequences really depend on the individual. Clearly some people have substantial amounts of savings and some people are lucky enough to be in good quality occupation schemes."
"Other people have very little savings and therefore rely on the basic state pension. The implications of that are obvious, given that the basic state pension is falling in real terms and has been doing so for the last ten years."
Mr. Dear concluded: "There are certainly 11 million households in the UK for whom it is uneconomic for the financial services industry to serve them. They simply do not save enough for it to be worth their while to send someone to knock on their door and talk about savings."
Speaking on the same programme, Paul Davies, of Mintel Market Research, added: "Mintel carried out some consumer research at the end of last year asking how much people were actually putting away each month for their retirement planning."
"More than 50% of people are saving less than £100 which is obviously insufficient."
Mr. Davies added: "We also looked at how people would save for their retirement going forward. The highest response was to buy a property, four out of ten people said they were investing in their future by buying a property."
Mr. Davies added that the next highest response was for ISAs and he added that 'way down the list was occupational pension and personal pensions'.