Nest Insight research shows millions more low earners could be investing

My guess is that the millions want to save for a pension but not invest for their retirement.

I see a lot of enthusiasm among adults in the UK for pensions (or should I say the State Pension) which is of enormous importance to the population. Next in popularity are public pensions (including LGPS) and the few remaining DB pensions. What is in common with these pensions is that those who build up pension do so without having to take investment decisions – or even worry about how the markets are doing.

Nest, along with other workplace pensions that offer people pots of money dependent on the pension scheme’s performance are not proving so popular. I wonder why? The vast majority of workplace pension savers walk away from taking investment decisions and I’m afraid that includes decisions whether to commit pay to future uncertainty.

Pensioners like those at the top of this blog will rue their lack of saving. Adequacy of retirement income in later life is a topic of many Nest Insight , PPI and Pensions UK studies.  But no one asks the question, were we to move not to putting money in pots but to buying pension would we get better take-up.

This pot, published by the popular paper the Sun, gives a view of the Pension Pot , it feels is taken by its readers.

pension pot as explained by the Sun

After 42 years of trying to explain how saving into one of these pots results in wonderful pensions, I’ve decided that for 42 years, I have been wrong.

Actually what people want from setting aside some of their pay is deferred pay – a retirement income that keep pace with inflation like the state pension (well almost that good!).

CDC is not as good as a guaranteed pension with a triple lock but it is a darn site better than a pension pot. That’s my belief, being a 64 year old, about to reach what I thought the SPA till quite recently.

I do not want to live with the uncertainty of investments from which I draw income, I want investments done for me and a pension paid to me. I am prepared to accept some ups and downs over 30 years I aim to live and expect that I will be much happier to increase my state pensions between now and when I draw my pension knowing what my pension will buy – in increased pension!

The Nest research is right in saying we have got money to save but wrong to think that we want that money in a Nest investment pot (or anyone else’s pot – if you ask!).