It is symptomatic of our failure to provide good pension education in the past that only a minority of people regularly review their pension benefits, as this latest report reveals: ‘A staggering 13.6m Britons have never reviewed their pension plans while a further 2.2m have not done so in the past five years, according to Barings Asset Management.’ What the report doesn’t reveal is WHY people don’t review their retirement provision. Is it a fear of advice?
Only yesterday, I replied to a member of the public who was arguing against the use of an IFA for pensions advice, with a view to D-I-Y pension planning. I used this analogy:
'I drive a car, but frankly don't understand how the engine works. When the car needs a service, I take it to a garage. There are lots of garages, but I asked around friends and family and found one that was popular and had a solid reputation. I've since built up a long relationship with the garage owner and trust him to do the best for me. If he says I need to replace something, I take his word for it.
I have peace of mind that if anything goes wrong with the car I can get access to his mechanics quickly. I could try to do the servicing myself but I acknowledge that I don't have the skills or time. Even if I did, it might save me money initially, but probably only in the short-term as there's a fair chance I'd eventually get something wrong with potentially dire consequences.'
I think the analogy works, don’t you? So, if we have an MOT for cars, why not for pensions too? For a plethora of revealing statistics, see:
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