Pickering advises against personal pensions
EUROPE – The chairman of the European Federation for Retirement Provision, Alan Pickering, says he would not advise a young person in the UK to put money into a personal pension.
Pickering, who is also a partner a consultancy firm Watson Wyatt, said in an interview on BBC radio yesterday that he would advise a person in their 20s and 30s to take up the option of a company pension fund, whether it was a final salary scheme or defined contribution.
But he would advise investing in unit trusts instead of a personal pension, to provide more flexibility. He added he would advise the person to clear their debts, excluding a mortgage, and put some money into a bank or building society.
Pickering is a former chairman of the National Association of Pension Funds and the author of a government-backed review of private pensions in 2002. He is a frequently in the media.
Pickering told IPE that he stood by his comments. He said the remarks were a “natural reaction to the nonsensical infrastructure” of pensions provision in the UK, adding that the state pension is “totally inadequate”. He said he was speaking in a personal capacity.
A Watson Wyatt spokesman said Pickering frequently provides comment, usually on a personal capacity, to the media on a range of pension-related issues. EFRP secretary general Chris Verhaegen was not contactable for comment.
Pickering’s comments come as a survey by KPMG found that 44% of working adults in the UK have no pension plan.