09 Aug 2016
Why now is the time to review your pension
Millions of savers currently spend very little time reviewing their pensions, with more than a quarter of savers (28%) admitting to never reviewing their retirement savings.
Millions of savers currently spend very little time reviewing their pensions, with more than a quarter of savers (28%) admitting to never reviewing their retirement savings.
And a fifth (19%) of those with a pension said they review it less than once every five years, according to figures released by Aviva.
Worryingly, the figures show that only just over a quarter of people (27%) think that their current contributions into their company pension scheme will provide enough for them in retirement.
Ask most people what they earn now and they’ll have a pretty good idea, sometimes down to the penny, but most people have no idea what their pension is worth.
The figures show that urgent action is needed to encourage people to take an active interest in their retirement savings.
While the number of people reviewing their pension is worryingly low, the research shows that the main thing that does cause them to act is the arrival of their annual pension statement.
Regularly check how your pension is performing
Investment funds rarely continue to perform well year after year, so it’s important to regularly check how your pension is performing.
In addition, over time the amount of risk many of us are prepared to accept in our investments typically tends to reduce, to the extent that by the time we’re close to retirement we may not wish to take much risk at all.
The closer you get to approaching retirement, the more important it is to know how your pension fund is performing.
If you wait until your retirement, the chances are you will have no idea what income you will receive, and then it’s too late to make any changes. The longer you have to prepare for retirement, the much greater chance you have of doing something about it and achieving a comfortable retirement.
Contributions should keep pace with our income
As part of a year-long study into people’s financial habits, consumers were asked which events had caused them to review their pension. The most popular answer was receiving an annual statement from their provider (35%), followed by a pay increase (28%) and starting a new job (17%).
A pension is a long-term investment. The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available.
Independent financial advice
To make the right investment choices, you need to ask the right questions. And when it comes to answering those questions, Aberdein Consdine can help you find the best way forward.
If you would like to get a sound point of view about what may be right for your unique situation, please contact us. We’ll review and discuss your financial situation, help you set goals, suggest specific next steps, discuss potential solutions and provide ways to help you stay on track.
To speak to one of our advisers, call 0333 0044 333 or click here.
Note: Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of, and reliefs from, taxation are subject to change. The value of investments and income from them may go down. You may not get back the original amount invested. Past performance is not a reliable indicator of future performance