Pension apathy rife amongst UK workforce

Pension apathy rife amongst UK workforce

02 September 2010 / by Paul Dicken

Almost half of the 17million people working in Britain have never reviewed their pension plans, according to asset manager Barings.
A poll conducted for Barings by ICM Research showed that 48 per cent had never reviewed their current pension plan, with 21 per cent saying they had reviewed their plan in the last year.

The poll, weighted to represent the working age population, questioned 1,478 people about their pension plans. The findings showed that 33 per cent of people who had reviewed their pension could not say whether they had chosen the default option for their pension contributions.

Almost one in five of those who did not know where they had invested their pensions were aged 55 or older.

The figure for people making investment decisions themselves increase slightly compared to research carried out by Barings in 2009. However, the number of people not reviewing their plans has increased from 43 per cent in 2009.

Barings’ chief investment officer, Marino Valensise, said: “The fact that individuals seem to continue to take little or no interest in financially planning for their retirement is of real concern.”

Valensise said the industry needed to improve how pension advice was given to ensure people better understood the levels of risk and the return they can expect from their portfolios.

Of  the people reviewing their plans, 19 per cent said either no explanation of how funds would be invested was given, or the explanation was poor.

“With the markets behaving so turbulently over the past few years, pension holders should be sure to review their schemes on an annual basis,” Valensise added.

The research from Barings followed findings earlier this week from Life and Pensions Moneyfacts showing the value of annuities (a regular income paid from a pension) had fallen to an all time low.

© Fair Investment Company Ltd