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Are You An Idle Saver?

Idle Savers, people who stay in default pension funds, are losing 4.75 per cent in returns every year, according to research from Hargreaves Lansdown.

 

Data from a survey of 58,000 workplace pension members show 47 per cent of people with a pension above £25,000 choose their investments. Comparatively, just 5 per cent of people with a pension pot under £5,000 are actively choosing funds.

Hargreaves Lansdown senior pension analyst Nathan Long says because default pensions funds are mostly conservatively managed, returns will lag. He says: “Many people don’t think of themselves as investors but as soon as you are put into a workplace pension, that is exactly what you become.”

Nearly a quarter (22 per cent) of scheme members choose their own investments, with people in their 40s most likely to do this.

Long says: “People tend to choose their investments after their pot has built up a little or they have been a scheme member for a number of years but you don’t have to wait. After all, it’s your money and the choices you make can massively boost your retirement prospects.”

The platform giant says £60,000 can be added to a pension pot by retirement by increasing investment returns by 1 per cent each year.

Redwood Financial is one of the souths leading Pension Planning, Wills, Trusts & Estate Planning providers and we are dedicated to helping families to grow, protect and enjoy their wealth. With our unrivalled knowledge of financial wealth planning, we can advise on any situation. Call us on 01489877 547 or Email info@redwoodfinancial.co.uk to book a FREE Initial Meeting with us to review your financial planning needs.

Read Hope William-Smith’s full article here Money Marketing