Impending pension closures 'underline need for savings flexibility'
By myfinances.co.uk staff
A recent report indicating that 94% of employers are planning to reduce or scrap their defined benefit pension provision has underlined the need for greater flexibility in long-term savings, according to a former Downing Street adviser.
Dr Ros Altmann argued that the PricewaterhouseCoopers study shows the need for new forms of retirement provision.
She argued that many people are already put off contributing to a pension because they are putting money into a "locked box" that they cannot access for decades.
Instead, introducing some form of "lifetime savings account" that gave investors access to at least some of their assets prior to retirement would be a good way of encouraging more Britons to set money aside for the long term.
Dr Altmann added that some companies are already considering using ISAs as an alternative to traditional pension schemes in order to providing this flexibility to their workers.
The former Treasury consultant and adviser to the Number 10 policy unit recently backed a report from thinktank the Centre for Policy Studies that proposed retrospective tax relief for assets held in ISAs that are re-classified as pension savings after retirement.
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