We talked to five interactive investor customers at different life stages about their attitude towards their pension and their savings habits and goals. Two of our experts offer their views and ex-pensions minister Steve Webb reflects on the state of pension saving.
Steve Webb writes...
It is encouraging to see that everyone started pension saving in their mid-20s or even earlier. Starting early is especially important for women, who will often face career breaks or periods of reduced earnings, and these can seriously damage your pension prospects if you haven’t already made a head start.
The responses on how frequently people monitor their pensions highlight the tension that, while we want people to be engaged with their savings and investments, there is a risk that if people are too engaged, they will ‘over-trade’ or overreact to short-term market movements.
Sadly, the very fact that these investors are so engaged makes them almost entirely untypical of much of the wider British public. For many in the wider population, if they had not been automatically enrolled into a workplace pension they might have little or no pension provision. These investors have shown that investing can be fascinating. If engagement means higher savings levels, then this could lead more people to have the kind of retirement provision they need.
Several investors have a goal of retiring well before state pension age, and this is only possible for those who can afford to do so through a mixture of meaningful savings levels and effective investment of those funds.
Steve Webb is a partner at consultants LCP, and was UK pensions minister from 2010 to 2015.
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