Following the introduction of pension freedom annuity sales have fallen as savers look to access their money through other kinds of drawdown products. Some like David Blake of the Pensions Institute have raised questions as to why a pensions revolution, was ever needed, ‘Pensions have to provide an income for life no matter how long [a person] lives and that has not changed,’ he said.
‘You haven’t only got your pension wealth [to consider] but your health, your family’s health and inheritance, “he said.
In order to help people stretch their savings across retirement, Blake thinks part-annuitisation should be compulsory, stating ‘voluntary insurance will not work’. ‘I think people have to be persuaded that the sensible thing to do is buy longevity insurance at least with part of their pension pot so they do not run out of money,’ he said.
Andy Manson, an adviser at KPMG, questioned whether retirees understood the responsibility they were taking on in managing their own pension pots. ‘They have high expectations that will not be filled,’ he said, and the next generation might be called on to bail out retirees who blow all their savings. If you are concerned about your savings Enable’s IFAs can help you with financial planning.
Source: New Model Advisor City Wire
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