Harris said much of the mass market of retirees are bewildered by the number of options they have when figuring out how to make the most of their retirement savings – and the government’s retirement guidance service Pension Wise just isn’t up to scratch.
He said: “For me it doesn’t matter who is elected – there is huge scope to build on Pension Wise.
“The hard fact is that many people who are entering or moving through retirement have got some options, they’ve got some freedoms which were given to them in the Budget last year, but they need to speak to an adviser that can look at their pension pot and their home.
“The market is overly focused on what they are doing on their £30,000 and £40,000. Their house is worth on average £300,000. The mass market needs to look at those two asset pools side by side.”
Simon Chalk, technical manager – equity release at Age Partnership, agrees that pensions guidance only goes so far.
He said: “It gives people information, but it doesn’t give them a path on which they should follow.
“It’s the mass market that will be confused. In the past they were told they should buy an annuity.”
Chalk also said pensions savings and property wealth need to be placed side by side, especially as retirees drawing down on their pensions will be charged income tax at their marginal rate on any money they draw down on the first year after they exceed their 25% tax-free allowance.
He added: “Equity release is commonly seen as a last resort, but if you put it side by side with housing wealth maybe it will become the second to last resort and the pensions fund will be the last resort.”
