Six in ten adults are not aware of some of the basic facts behind the massive restructuring of UK pensions coming in to force this April, according to new research from Octopus Investments.
To gauge public understanding of the forthcoming changes almost a year after they were announced, Octopus polled a nationally representative sample of over 2,000 adults, presenting them with eight statements about the pension reforms and asking them to identify which were true.
While all statements were, in fact, completely accurate, the number of people who identified them to be true was shockingly low. Just 22% of people polled are aware that those over 55 will be able to take advantage of pensions flexibility when the reforms come into effect in April.
The low levels of awareness of some of these key facts only improved slightly for those that are potentially nearing retirement. Less than one in three (29%) of those polled those aged 55+ is aware that they will be able to take advantage of increased flexibility with their pension after April 2015, and only one in four people (25%) know that they are entitled to free guidance to help them make sense of their financial options at retirement.
Simon Rogerson, CEO of Octopus Investments, says: “The upcoming pensions revolution is the biggest shake up in terms of financial planning that Britain has seen for decades. The Government is handing back control to people and unlocking a range of options for retirement. However our findings show that the vast majority of the public are simply not clear on many of the basic changes that underpin these far-reaching reforms, including the fact that that they can seek guidance on the different choices now open to them.
“There’s clearly a very real need for all those involved in these changes – the Government, financial services providers and financial advisers – to close the knowledge gap and help people to really get to the bottom of what their financial future might now look like. It is time for people to seize the opportunity the Government has presented and take action, seek advice and start to think differently planning for their retirement.”