Housing secretary James Brokenshire has suggested that youngsters should be allowed to access their pensions savings to help them get on the property ladder. The controversial idea has prompted many pension industry experts to speak out, including Stuart Price, Partner and Actuary at Quantum Advisory.
“To implement Mr. Brokenshire’s proposal would involve a major reform of the pensions system. It could potentially also undo a lot of hard work that has gone into educating the younger generation about their pensions and encouraging them to save for their retirement. If, given the choice of breaking into their pensions savings to buy a new home today, or keep the money saved away for years later, many would unfortunately choose the former and see the benefits now. This puts them at a huge risk of not having enough in their pots when they do eventually come to retire. Minimum contributions are already too low for many to enjoy a comfortable retirement. If individuals keep eating into their pensions, their finances when they do retire may come as a shock.
“Hopefully, with the introduction of the pensions dashboard – which will allow everyone to see all their pension income and predict how much they will have to live on throughout retirement – people will see how much they need to be saving and take action.”
Stuart Price is a Partner and Actuary at Quantum Advisory, which has offices in London, Amersham, Bristol, Cardiff and Birmingham.
Established in 2000, Quantum Advisory provides pension and employee benefits services to employers, scheme trustees and members.