The state pension is increasingly being viewed as a safety net, with Britons encouraged to put their own money aside for retirement. However, some individuals could still be at risk of failing to secure a comfortable retirement, new research has suggested.
A study has shown defined contribution (DC) pensions which do not automatically offer secured, guaranteed income for life can lead to poor outcomes for low income Britons.
Guaranteed income arrangements have been far less common since the introduction of pension freedoms back in 2015.
With more Britons opting against a guaranteed income, the University of Birmingham has warned individuals face significant threats to security in retirement.
The research concluded the existing system disadvantages those who are already vulnerable to poor pension outcomes.
READ MORE: Britons urged to act on pensions as retirement ‘in sharp focus’
When not taking formal advice, individuals felt unsure of who to trust, or who to turn to about making important decisions.
Consequently, researchers have called for further support from Government on the matter.
They have also stated Britons would benefit from price-capped advice to help lower income individuals, with help to reduce risk.
Dr Louise Overton, Assistant Professor in Social Policy and Director of CHASM at the University of Birmingham, also analysed the research.
She added: “Seven years on from the introduction of pension freedoms, too many people are facing poor retirement outcomes because industry and Government aren’t doing enough to protect them.
“Our research shows that Pension Wise does not offer adequate support, and those without access to good quality regulated financial advice – those with smaller pension pots and lower incomes – are particularly at risk of adverse outcomes.
“We call on Government, industry and the regulator to expand the scope of money guidance, widen access to regulated advice, and prioritise product innovation.”
A Department for Work and Pensions (DWP) spokesperson told Express.co.uk: “The Government is committed to ensuring everyone has the support and information they need to make informed choices about their financial futures. Free and impartial guidance is available via Pension Wise and Money Helper, and we’re making receiving Pension Wise guidance a normal part of the process when savers seek to access their defined contribution occupational pension.
“Alongside the industry, we’re also investing in simpler statements and pensions dashboards to help make it easier for people to access and make sense of their pensions information to support their retirement planning.”
For all the latest Business News Click Here
For the latest news and updates, follow us on Google News.