Individuals currently saving for their personal pension plan have been urged not to wait until the government implements its pension reforms.
After the Labour government yesterday submitted the Pensions White Paper, financial advice providers Fidelity have said that a typical UK household still faces a 50 per cent drop in income upon the earners reaching retirement.
Fidelity's retirement index indicates that households which rely on their pension currently suffer a 60 per cent reduction in income.
Simon Fraser, head of international business at Fidelity, commented: "People should not be lulled into a false sense of security by these reforms … it will not have the impact on their standard of living in retirement that people are expecting.
"It is important to note that the link to earnings will not even be implemented until 2012 … on current trends, people are still facing a 50 per cent drop in income unless they start saving more now."
The White Paper contains the government's plans for reforming the pension system, including a restoration of a link to earnings in 2012 and raising the retirement age to 68 in the future.
Workers warned not to delay pension saving
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Workers warned not to delay pension saving
Fri, 26 May 2006
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