Most savers risk poor retirement without tailored support, warns regulators

In a joint podcast, the Financial Conduct Authority (FCA) and The Pensions Regulator (TPR) called on pension professionals to act now to help savers make the right choices at retirement by understanding the different needs within their schemes.

Patrick Coyne, interim director of pensions reform at TPR, said: “Millions could be drifting toward an uncertain retirement. 

“Government data shows over 14 million people are under-saving for later life. 

“That is why we have to make sure the system provides them real value for money and that people are supported into the right retirement pathway for them.”

Coyne added: “Nobody saves into a pension expecting a pot, they expect a sustainable retirement income and with these reforms, and the revived pensions commission, we have a real chance to make that happen.”

Coyne said trustees should respond to the FCA’s consultation on targeted support. 

He said: “We know trustees want to support members, but uncertainty around the advice boundary is a real barrier. 

“Now’s the time to share examples and help shape future rules.”

The podcast highlighted the importance of using data like age, pot size and when a person plans to retire to send the right communications and help members find suitable income options. 

Coyne added that trustees should give examples of the support they want to offer, especially ready-made suggestions for in-scheme benefits, to see if they could deliver it themselves or with an authorised partner.

The FCA’s targeted support proposals and the pensions schemes bill plans for guided retirement solutions were discussed as working together to help members. 

Trustees were encouraged to take part in the consultation and share their views.

Nike Trost, head of department – asset management and pensions policy at the FCA, said: “I think there being more support available for consumers both in their savings journey and importantly, at the point of retirement, has to be the success we aim for. 

“It’s about consumers being offered really good product choices to choose from in a really simple way.”