The delights of pension freedom!
The People’s Pension and State Street are running a research project on the decisions people are taking with their “pension” pots. The study can be read by following the link at the bottom. It’s interesting as the 80 people followed over time are what the FCA call “vulnerable” , they aren’t financial experts, don’t have advisers and don’t have a history of independent financial decision making (SIPPs , buy to let etc. These people are on their own and it shows
The conclusion reached is that
“Engagement remains a key challenge. Given this, it is unlikely that ‘retail’ solutions alone are going to be appropriate. Instead, institutional options, most notably simple and effective default options…”
This is confirmed by this excellent report and it’s vox pops.
People purchase annuities out of fright
cash in their chips
Decisions bring surprises- even within the early time scales of this longitudinal survey.
It really doesn’t matter whether people are advised or unadvised, they seem equally hapless!
Though a few are asking questions
The report is a gem, we will look back at it- and other in the series – and cherish people’s early optimism and sang-froid.
Whether such optimism will be there in ten let alone thirty years is another matter!
You can read this excellent work in full by following this link – I urge you do!
Click to access 16047_SSGA_TPP-SSGA-Joint-Research_FINAL-COMPLIANCE-APPROVED.pdf