Wednesday 19th March 2014
Commenting on changes to pensions and savings announced by the Chancellor, Mike Smedley, Pensions Partner at KPMG, says: “The Budget turns the world of pension savings upside down. With almost unrestricted access to pension pots in future, this will radically affect the way today’s workforce saves for tomorrow. From limited choices, individuals now have greater flexibility to decide how they save for the future, but with more decisions to be made, comes more responsibility and greater risk.
“In the immediate term this will lead to a knowledge gap. People will be trusted to make the right decision for themselves, but the truth is that employers, employees and pension schemes and providers must work together to develop new approaches that help individuals make the right decisions.”
David Fairs, Partner and member of the People Practice leadership team, adds: “The complexity of modern working lives, combined with ever increasing life expectancy, means that the existing savings framework often don’t work. With an increased ISA allowance and more flexible pensions, savings can match more modern life styles where people change jobs more frequently, are with different partners and have different periods of economic activity. Employers have an opportunity and, possibly, an obligation to increase financial education for their employees as a result.”
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