Enable’s IFA’s know pension choices are vital and some recent research commissioned by The People’s Pension and State Street Global Advisers, titled New choices, big decisions: Exploring consumer decision making and behaviours under pension freedom and choice, reports that some feel upset and confused about pensions.
“It’s a very serious matter. If I muck up at 60, I muck up for the rest of my life, I’ve got to get this absolutely correct and that’s the problem, it’s a minefield.” One 64-year-old man told researchers in an interview.
Ignorance really is not bliss when it comes to pensions. In the CISI survey, 57% say they know what a pension is and how it works, but 40% don’t know how it works.
Researchers and public policy organisations have tried to understand why the level of pensions knowledge is so poor. Workplace pensions provider, NOW: pensions, surveyed 1,000 adults in the UK aged 18–30 reveals: 71% say the terminology and jargon is a barrier to engaging with the subject; 42% say they don’t need to understand them as retirement is far away, and 27% say they are just too complex.
Trust in financial services in general, and pensions, in particular, were undermined by the 2008 financial crisis. “Amongst all respondents, we observed a strong undercurrent of mistrust in pensions, with many reporting that their faith in pensions has been eroded over the years by one bad news story after another.” Such perceptions are very deep-seated and will not be quickly or easily reversed by education or interventions.
But it is important to really explore and understand your pension options not just ignore them. Enables independent financial advisors in Bishops Stortford can help you cut through the jargon that has become the language of pensions, particularly now we have added drawdown, flexible-access drawdown, uncrystallised fund pension lump sum, and so on… let us help you with one of the most important areas of your financial planning.