The state backed pension scheme, the National Employment Savings Trust (Nest) has launched an investigation to ensure that the pension scheme is as flexible as possible for users and accommodates how people save.
Adapting to the way People Save
The investigation looks to adapt to changes announced in the Budget, with the scheme launched by Nest using pre-Budget figures
The analysis looks to adapt due to the fact that many members are no longer saving with the main aim of buying an annuity at a fixed date but are rather choosing to delay buying an annuity and remain invested in the scheme.
The investigation will look to see if Nest should have numerous default funds, whether deferred annuities should be offered through the scheme, or if risk sharing should be offered between members
Must React Quickly
According to the Nest chair of trustees the report must react quickly for those who may be in the scheme and retiring in ten years. Lawrence Churchill says: “Nest has put forward some compelling evidence in this consultation document. But we don’t have all the answers.
"We need help and we need to work collaboratively to develop solutions that put savers first”
Nest chief investment officer, Mark Fawcett, said the Budget meant savers no longer had straight choice between annuities and drawdown.
He said: "The old binary debate between annuities and drawdown is no longer relevant.
He added: "Instead we have an opportunity to look at how elements of each might be used to create more flexible solutions, fit for the majority of savers."