It’s Pension Awareness Day! This annual campaign provides insight into the current issues surrounding pensions including, the benefits of having a pension and scams to be aware of.
The ageing population of the UK is currently in the grips of a savings crisis. Approximately, one third of the UK working population are not saving enough for their retirement. And this does not seem to be improving.
As a result of the national lockdown, 1 in 10 workers have reduced or completely stopped contributing towards their pension pot. This is a worrying trend as workers could end up losing out on notable returns.
The Pension Age explained that “a 30 year old earning £30,000 could lose as much as £45,539 from the value of their pension by opting out of a pension for three years, representing a drop in value of their pension at age 67 of 9.3 per cent.”
The long term effects of reduced pension contributions will result in people having to work past the age of retirement or cause people to live with a less comfortable lifestyle. In worst case scenarios, people can actually run out of funds entirely.
Because of this fear, people in their mid 50s to early 60s usually find themselves as targets of pension scams, which persuade people to transfer funds entirely or fund high risk investments.
Most recently, The Information Commissioner’s office (ICO) fined CPS Advisory for consciously disregarding the law by conducting unauthorised cold calls. Furthermore, John Glenn who is the economic secretary to the treasury said “pensions cold calls are the most common method used to initiate pension scams...That’s why we banned them”.
Going forward, with more scams circulating digitally, it is important now more than ever to be vigilant of cold contacts and investments that seem too good to be true, because they usually are!
About Akoni: Akoni is an award-winning UK cash platform, which provides a marketplace to SMEs and charities, as well as to individuals through our white label distribution partners including IFAs, wealth platforms, accountants and SME hubs. Akoni uses innovative technology to personalise cash planning solutions for clients, and also provides a full API solution to banks and insurance clients.