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Pensions top for saving but planning left to last minute

FSA consumer research shows pensions are top of the public&#39s savings agenda but most financial planning is carried out only just before retirement.

The FSA undertook the research to look at how consumers plan their financial future and found there is a significant demand for advice.

Pensions are seen as the key vehicle for making provision for retirement, with little consideration given to other methods of saving.

It found that pensions are trusted – with little mention of pension misselling – but there is low understanding of how they are invested and why ret-urns are not guaranteed.

Retirement planning is usually done late in life, with decisions being made only two or three years before or even during retirement, while advice was seen as most important when dealing with occupational pension lump sums and annuities.

Understanding of annuities is very low, even among people with personal pensions, with the majority unaware that annuity purchase is compulsory.

Consumers have “supreme confidence” in company sch-emes, which are seen as the easy option because they allow individuals to delegate responsibility for their pension.

Ruth Whitehead Associates principal Ruth Whitehead says: “Retirement planning is incredibly complex. It is vital to have the best product, not just the mediocre, and you need an IFA to find it for you. This research shows IFAs are needed but the FSA seems intent on removing consumer choice.”


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