Just one in three say they fully understand pension freedoms two years after launch and nearly two out of five are worried about scams
Nearly two out of five MPs say UK pension freedom is still not fit for purpose
MetLife report Real Pension Freedom: The Delivery Scorecard outlines the opportunities and challenges facing savers
Its research among over-55s two years on from the launch of pension freedoms found more than three out of four (76%) want a pause to further reforms to enable savers to plan for their retirement with increased certainty.
The study found just one in three savers (35%) believe they have a good understanding of the new freedoms designed to deliver increased flexibility and more than half (54%) find the rules confusing. In addition, exclusive research among MPs shows nearly two out of five (39%) still believe the current pension system is not fit for purpose.
The research is part of a series of four reports from MetLife starting with Real Pension Freedom: The Delivery Scorecard available to download at [metlife.co.uk] outlining the opportunities and challenges facing savers as well as advisers, providers, regulators and the Government.
It identifies the real worries for savers from the new pension freedom including concerns about being targeted by fraudsters and running out of money while being squeezed by ongoing low interest rates and investment market volatility.
Around 36% of over-55s fear losing their funds to fraudsters while 43% are worried their pension funds will not last them through retirement. Around 57% say current low rates and stock market volatility mean their retirement savings are not sufficient to fund retirement.
Simon Massey, Wealth Management Director at MetLife UK said: “Pension freedom has been a qualified success delivering real change but it needs to be improved in order to deliver on supporting savers and advisers in providing a pension system fit for the 21st century.
“Savers have access to a broader choice of options than ever before. They need to understand all their options when it comes to taking a retirement income and MetLife is committed to helping deliver a wider choice through solutions that work in the new world of retirement.
“The pace of change over the past two years has been bewildering for savers and it is clear they want a pause for breath in order to better understand the opportunities from the new rules.
“But it is also clear that there are short-term and longer term improvements which can be made in order to ensure that savers and advisers benefit from real pension freedom with advice and financial education at the top of the agenda, enabling better understanding of the choices available.”
MetLife’s series of reports covers four areas of pension freedoms, including a review of the past two years, an assessment of the demand for advice plus analysis of the social and economic challenges and a series of recommendations for the future. The reports will be released over the coming two months as MetLife expands the debate.
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