Consumers confused about pension options
More than two thirds of adults with retirement savings have no idea how much they'll have to retire on, according to the latest independent research, Marketing Science's Retirement Planning Monitor (RPM).
NFU Mutual, insurance, pensions and investment specialist, was one of a number of financial institutions taking part in the 2011 RPM survey in which more than 1,000 adults aged between 22 and 64 took part.
Jane Mulford, pensions specialist at NFU Mutual, commented: "This research shows just how little some people know about how they will maintain their standard of living after they retire. It's vital that people make adequate provision for later years so when they do retire, they won't be living beyond their means."
70% of respondents who had some retirement provision said they had never worked out how much income they would receive when they retired and of those who have, over a third (39%) worked it out themselves rather than seeking advice from a professional.
The figures also highlighted a lack of pensions knowledge among those approaching State retirement age. A quarter of respondents aged between 55 and 64 years old didn't know what a State pension is worth - something which will make up a large share of retirement income for many people.
Mulford continued: "Working adults of all ages need to have a good idea of how much they will have to live on when they retire. A significant shortfall could lead some to have to downsize their home or be forced to keep on working just to make ends meet.
"The confusion around pensions and retirement highlighted in this survey demonstrates the need for people to talk to an adviser about their retirement plans and current provision.
"Professional advice on retirement provision should be taken regularly throughout working life so pension pots and other investments can be reviewed and their performances assessed. If priorities change, retirement plans can be adjusted accordingly to match retirement ambitions."
Two-thirds (66%) of respondents to the RPM 2011 survey said they found pensions "confusing". Mulford says talking to a professional adviser is the first step to dispelling any myths about pensions and retirement savings:
"At the very least, people approaching retirement should have an idea of how much their income and outgoings will be once they decide to bring their working life to a close. This should help to prevent people from retiring into poverty and could ensure people meet their desired standard of living throughout retirement."
NFU Mutual understands the pensions and investment needs of those who live and work in the countryside and is dedicated to helping its members make the most of their money.
With over 300 Agency offices throughout the UK, NFU Mutual members wanting to discuss their financial provisions can book an appointment with an NFU Mutual Financial Consultant. Members can even arrange a home visit to talk through their finances in the comfort of their own living room.
NFU Mutual Financial Consultants advise on NFU Mutual products and services and in special circumstances those of other providers. For more information on NFU Mutual's pension products, visit nfumutual.co.uk.