The survey found that in 2017 52% of people have no retirement plan in place compared with 37% without a plan in 2010. There was also a fall from 10% to 6% in those using a financial adviser compared with 2010.
The survey also found that 28% of consumers surveyed said they did not know who they would use for pension advice. Of those surveyed, 23% with financial investments chose to review financial performance themselves compared with just 9% reviewing through a financial adviser. Half of those questioned had not reviewed their savings or investments at all in the last 12 months.
Fairstone, an acquisitive Financial Planning firm, says the survey shows a worrying decline in the number of people with retirement plan or using a financial adviser.
The cost of financial advice could be the cause, says Fairstone, as 26% said it was the most important factor when choosing an IFA, followed by trust in the adviser (23%) and recommendations from friends and family (19%). These figures show that the cost of advice is viewed as more important than the longer-term objectives of managing investment portfolios, revealed the survey.
Lee Hartley, chief executive of Fairstone said: “The new pension legislation has effectively doubled the period of time that financial advice is needed, yet fewer people are engaging an adviser. As a Chartered Financial Planning firm, we see this as an opportunity for our business and a major challenge for the industry to engage more with existing and potential clients to ensure everyone who needs it can receive professional financial advice. There is no substitute for long-term Financial Planning in ensuring a more comfortable retirement.
“What our survey clearly highlights is that previous initiatives have failed and as an industry we need to step up to the mark and engage with the broader population. Consumers need to be made aware of how they can access the best solutions for their individual circumstances.”
The introduction of auto-enrolment meant that the majority of participants in work had a workplace pension (82%), more than half (52%) have no retirement plans in place and more than a quarter of people who are working have no clear idea when they might retire.
Introduced in 2012 (to be enforced by 2018) auto-enrolment makes it compulsory for employers to automatically enrol their workers into a pension scheme, the employer must pay money into the scheme.
Mr Hartley added: “Auto-enrolment should be applauded for bringing more of the population into some form of retirement planning but it falls short of addressing the significant education job that needs to be done by Financial Planners such as ourselves and by government to encourage a more long-term and holistic approach to retirement planning – in most cases, auto-enrolment will not meet the income requirements for retirement and planning early can make a significant difference.”
Ipsos MORI interviewed 2,200 adults aged 16-75 in the UK using Ipsos MORI’s online omnibus. Interviewing took place in February, with fieldwork quotas set on age, gender and region.