December 11, 2024

On World Financial Planning Day Pension Potential urges people to plan and secure their retirement

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On World Financial Planning Day, which highlights the importance of financial planning, Steve Butler, CEO of Pension Potential, is urging people to take their retirement planning seriously to avoid future financial struggles.

With new figures showing a sharp rise in people tapping into their pension savings, Butler is calling for individuals to seek proper financial advice before making decisions that could leave them short in later life.

 

Recent data from the Financial Conduct Authority (FCA)[i] reveals 885,455 people accessed their pension for the first time last tax year—nearly a 20% jump compared to the previous year. However, less than a third (30.9%) sought regulated advice before doing so, a concerning statistic given the long-term risks.

 

Butler says, “The rising cost of living is pushing more people to dip into their pensions. But it’s alarming how many are doing so without expert guidance. Without proper advice, there’s a real risk they’ll outlive their savings, especially as life expectancy continues to climb.”

 

Additionally, annuity purchases have surged by 38.7%, with 82,061 people locking in annuities this year. While higher interest rates have improved annuity deals, Butler stresses that understanding all retirement options is key to securing a stable financial future.

Backing this up, a survey by the Institute for Fiscal Studies (IFS)[ii] revealed that only 20% of UK adults aged 25 to 64 correctly stated the value of a full state pension. Two-thirds are also unaware of the income needed for a reasonable standard of living in retirement, and just 9% claim to have a good understanding of pension issues.

 

Butler adds, “Many will spend 20 plus years in retirement. Planning for retirement and getting the right advice before accessing pension pots can help ensure their money lasts that long. By using tools like Pension Potential’s calculators and annuity search, people can make informed decisions and maximise their savings. This can ensure they enjoy a secure and comfortable retirement.”

 

Pension Potential has a range of simple tools including online retirement and lifestyle calculators and an ‘all of market’ annuity search solution to select the best deals. It also gives access to personalised retirement recommendations with an easy to follow ‘advice journey’ which ends with a video call with a financial adviser.

For more information visit: www.pensionpotential.co.uk.

 

About Pension Potential:

Pension Potential is part of Punter Southall, a professional services company specialising in pensions, insurance, law and retirement.  Since 1988, Punter Southall have anticipated what clients need and evolved to deliver pragmatic solutions for people and business across diverse yet connected markets.  Pension Potential offers guidance to help people understand their pension options. It also offers regulated financial advice through its Chartered Financial Planning team. Pension Potential is authorised and regulated by the Financial Conduct Authority.