Should I Start Taking My Pension More Seriously?
Recent developments and accompanying research about the finance industry should be set to make many UK adults start thinking about their
pensions more seriously, and whether we have the necessary savings plans in place for our future. Of course, it is difficult to face up to the importance
of storing money away at a time when many of us are cutting back and still finding it difficult to afford the bare necessities. Yet, now may well be the
most logical time to do so.
Perhaps the most alarming research published recently (August 2009) is that by Prudential (UK). According to the retirement specialists, nearly a third
of Britain's 8.8 million active occupational pension scheme members are unaware of how their retirement money is invested, with over a quarter (2.5
million) never reviewing how well the pension is working.
This research caused The Independent's Simon Read to refer to the state as 'inertia' at independent.co.uk. He stated: "Even more alarming is the fact
that almost half of workers aged 25-plus have their money invested in the "default" fund of their company pension scheme."
At first glance, the data and Read's response highlight a glaring and significant issue. Whilst most adults are willing to take their time ensuring they are
getting the best savings rates, the cheapest car insurance, or the killer 2 for 1s at the supermarket - they don't seem to care about their pensions as
much. If they haven't got one, then it is always something to be done, but something that can wait. After all, retirement is a long way off. Additionally, if
you start working at a new company and they mention that there is a pension scheme in place, this is seen as something of a bonus - and little more.
Of course, leaving you pension scheme to a company default plan is never likely to be the absolute best for your money, especially at a time when the
market is particularly changeable. However, Read's response also had an impact on me, reading the research as a 25 year old. Do I