Nearly Half of UK Workers Never Reviewed their Pension Plans - Bearings

02 September 2010 (PLANSPONSOREurope.com) Barings sounds warning over 'head in sand' attitude to pensions

Nearly half of the adult working population have never reviewed their pension plans despite the recession.

Barings has warned millions of workers may have to work into their seventies to make up for bad pensions choices unless they get to grips with the scheme they have signed up for.

Of the 52% that have assessed their pension schemes, nearly two fifths admit they went with the default option available to them when joining a company, new research by Baring Asset Management has found. Of those, 19% said they were unsure how their funds were invested or said it was not explained to them.

A further 33% could not say whether they had chosen the default option for pension contributions, the study of 1,478 workers found.

The research found that one in five of those who didn't know where they had invested their pension were aged 55 or above and fast approaching retirement.

Marino Valensise, of Barings, told The Telegraph: "The fact that individuals seem to continue to take little or no interest in financially planning for their retirement is of real concern. The industry needs to improve the way in which pension advice is given so that people better understand the levels of risk and return that they can expect from their portfolios."

He encouraged individuals to review their schemes on a yearly basis, especially "with the markets behaving so turbulently over the past few years".

The study also revealed an increasing number of workers have never even thought about their financial plans for retirement. Some 46% of the working population, about 16.2m adults, confessed to never having considered how they would fund their retirement – an increase of 3% on last year.

Katherine Blackler
editors@plansponsoreurope.com