One third of companies worry that their employees won’t make the right decision following pension freedom.
New research from Mercer and the Confederation of British Industry has shown that, following the Freedom and Choice in Pensions reforms, one third of businesses (36%) are concerned that their employees won’t make the right decision on how they use their pension pot when they reach 55.
The research from the CBI/Mercer 2015 Pensions Survey solicited views from 166 UK organisations and was undertaken partly to assess the impact of the Government’s Freedom and Choice in Pensions legislation, which gives people more choice and responsibility on how they use their retirement funds.
The report found that, as a result of their concerns, 66% of companies were looking at additional propositions such as providing more guidance to members. To meet this demand, Mercer is launching the Mercer Harmonise Retirement Income Service specifically aimed at helping retiring defined contribution (DC) members make the best use of their retirement savings.
Roger Breeden, Partner at Mercer, said:
“The Mercer HarmoniseTM Retirement Income Service is designed to support those retirees in DC schemes determine how best to use their pension savings leading up to, and into, their retirement. With people still underestimating their life expectancy, the risk of running out of money in later life remains a reality for many people. It’s essential that retirees have enough support, advice and information to make and execute the right choices on how to best invest their hard earned savings.”
The service also helps employers demonstrate the value of the benefits that they provide to their workforce in a cost effective manner. It can be accessed through an easy to use platform, providing retirees with a range of educational and planning tools as well as access to advice and a range of retirement income plans from market leading providers.
The service can be completely integrated with Mercer’s new Health and Wellbeing platform Mercer Harmonise™. Launched in September 2015, it centres on a digital platform aimed at helping employees take control of their wealth and health.
Niall O’Callaghan, Partner at Mercer said, “Mercer Harmonise is designed to help people take greater control of managing their health and wealth, irrespective of age. A key component to this is enabling people as they approach retirement to make the right decisions for their future. Mercer HarmoniseTM Retirement Income Service helps with these critical retirement decisions but also provides ongoing support to retirees throughout their retirement.”