Welcome to the 2018 issue of Insight. Increasingly, more and more pensioners are keeping much of their pension invested after they retire. This means they’re faced with two very different risks when deciding what to do with their savings in retirement in a world of ‘pension freedoms’. Since April 2015, people who reach retirement have had much greater flexibility over how they use their pension funds to pay for their later years. A recent report identified that many savers in retirement are either taking ‘too little’ risk (the ‘risk averse’ retiree) or taking ‘the wrong sort’ of risk (the ‘reckless’ retiree). On page 06, we look at how each of these approaches increases the danger of a saver either running out of money during their retirement or having to face a reduced standard of living.
Over three million working couples are classed as ‘double income, no option’ (DINOs), which means they are potentially financially vulnerable if one of the two loses their earnings.