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Press comment: Good Money Week is a reminder that pension engagement is key

If you’re covering Good Money Week please see the following comment from David Gibb, financial planner at Quilter.

“People may have heard the term auto-enrolment and may also have a vague understanding that part of their pay is deducted and put into a pension. But in my experience, for the vast majority the understanding ends there. Often when people come to me they’ve got no idea how much is in their pension and haven’t changed it from the default fund.

“While auto-enrolment has undeniably been successful in getting UK employees into retirement saving, there is a much larger piece of work that is ongoing to get them to actually look at that savings and make necessary changes.

“This is problematic for a number reasons. One of the biggest is there is a risk of pensioner poverty that the current generation savers are blissfully ignorant of. They may think that auto-enrolment means they don’t have to worry about their future, but the reality is it’s highly unlikely to be enough, particularly as the we start living longer.

“For example if a 25 year old on a current average annual UK salary of £28,700, remains in a similar role and is auto-enrolled until the age of 68, they might expect to receive a retirement income of around £5,600 per year in real terms. This works out to be a terrifying 60% shortfall in the amount of money millennials can expect when they enter retirement compared to those today who are just about to start enjoying their golden years, as figures suggest those aged 60 to 65 will have an annual income of between £14,200 to £17,000.

“Money is power. That’s a common and understood fact. But people often see the money that has gone into their pensions as gone into a black box that disappears from view. In reality it’s in the investment markets which and as a collective that money has the power to shape the nature of how companies act and indeed which are successful.  In 2018 the amount saved into workplace pensions was an intimidating £90.4bn annually. That’s enough to make most companies squirm.

“It’s important that when you are invested that you consider how where your money is going fits with what you believe in and value. It is powerful and not just a figure on your pension statement.

“For those just starting to consider their workplace pension here are five initial questions you should be trying to answer:

  1. How much is in my pension?
  2. How much do I need for a comfortable retirement?
  3. Where is my money invested?
  4. How is the fund or funds performing?
  5. Do my investments align with my values and beliefs?

“A financial adviser can help you answer these questions and set you on the right path, no matter what you’re age. This week also marks Financial Planning Week where many advisers are offering free one-hour, one to one financial advice sessions. To find a participating adviser check the CISI website.”

For more information contact

Kathleen Gallagher
023 8072 6293 
079 9000 4932 

Notes to editors:

Quilter Private Client Advisers is a national advice business and part of Quilter plc. 

Quilter plc is a leading wealth management business in the UK and internationally, helping to create prosperity for the generations of today and tomorrow.

Quilter plc oversees £118.7 billion in investments (as at 30 September 2019).

It has an adviser and customer offering spanning: financial advice; investment platforms; multi-asset investment solutions; and discretionary fund management.

The business is comprised of two segments: Advice and Wealth Management and Wealth Platforms.

Advice and Wealth Management encompasses the financial advice business, Quilter Financial Planning; the discretionary fund management business, Quilter Cheviot; and Quilter Investors, the Multi-asset investment solutions business.

Wealth Platforms includes Old Mutual Wealth UK platform; Old Mutual International, including AAM Advisory in Singapore; and the Old Mutual Wealth Heritage life assurance business.

The Quilter plc businesses are being re-branded as follows: 

  • Quilter Financial Planning (previously Intrinsic)
  • Quilter Private Client Advisers (previously Old Mutual Wealth Private Client Advisers)
  • Charles Derby Group (becoming Quilter Financial Advisers)
  • Quilter Financial Adviser School
  • Quilter Cheviot
  • Quilter Investors
  • Old Mutual Wealth (becoming Quilter Wealth Solutions in 2020)
  • Old Mutual International (becoming Quilter International in 2020)

This press release is for journalists only and should not be relied upon by financial advisers or customers.

Please remember that past performance is not a guide to future performance. The value of investments and the income from them can go down as well as up and investors may not get back any of the amount originally invested. Exchange rate changes may cause the value of overseas investments to rise or fall.

This communication is issued by Quilter plc.  Registered office: Millennium Bridge House, 2 Lambeth Hill, London EC4V 4AJ, United Kingdom. Registered number: 6404270.  Registered in England.