The study by the Pensions Management Institute and employee benefits and advice firm Wealth at Work found that most trustees were concerned that members were “ill-prepared” for the risks they faced when accessing their pensions.
Concerns from trustees included:
- 88% fear their members nearing retirement will face “predatory attention” from scammers.
- 81% believe members are “not equipped” to deal with the taxation implications of accessing their pension.
- 85% have concerns on risks their members face if they transfer out of their DB schemes.
- 60% are concerned that their members’ money will not last the duration of their retirement.
- 63% worry about a lack of engagement from their members.
The figures suggest most members face major risks when they are close to accessing their pensions and there is a major lack of support and advice for members.
Jonathan Watts-Lay, director, WEALTH at work, said: “Pension scheme members nearing retirement face some unique challenges. The retirement income options open to each member can confuse and bewilder even the savviest person and leave them open to an array of risks.”
“As the findings show, a vast majority of trustees fear their members nearing retirement will face predatory attention from scammers.
“Trustees also have taxation fears for their member’s at-retirement.”
Despite the concerns, the survey found that only 35% of employers provide financial education for their members and 61% of trustees indicated that their schemes do not provide or facilitate one-to-one financial guidance for members at-retirement.
Just one in five (21%) trustees are providing or facilitating regulated advice for their members at-retirement.
Wealth at Work conducted the survey with the PMI and received 65 responses from a range of trustees from December 2018 until March 2019.