23 April 2002

Regional Stakeholder - West Midlands

  ONE YEAR ON AND 34% OF PEOPLE IN THE WEST MIDLANDS ARE STILL OBLIVIOUS TO STAKEHOLDER PENSIONS

A full year since the Government unveiled its grand plan to set the nation saving for retirement, over a third of UK adults living in the West Midlands,  (1.78 million) have still never heard of its central pillar, the stakeholder pension, according to new research from IFA Promotion, the organisation promoting the benefits of independent financial advice.  Worse still, ignorance is at its peak amongst the less prosperous social groups, an important part of the governments target market with over half 55% of so-called ‘DEs’ unaware of this low-cost pension option. 

The research, conducted by NOP Omnibus*, also reveals that only one in five of those aware of stakeholder found out about the schemes through their employer - this despite the ABI’s announcement last week that over 90% of target businesses are making stakeholders available to their staff**.  Furthermore 57% of adults find pensions confusing, up from 42% one year ago, indicating the Government’s high-profile awareness campaign is falling short of its objectives.

David Elms, Chief Executive of IFA Promotion, said, “As its adverts suggest, the government is keen to teach an old dog new tricks, simply by giving out free factsheets.   But many people just don’t understand pensions and won’t devote the time to gen up for themselves.  As a result, low cost or not, pensions will continue to be sold, not bought; and without allowing headroom for advice these products will fail to find the audiences for which they were intended.”


Of interest amongst the survey’s other findings was that:

·          Just 8% of people have taken out a stakeholder pension, whilst over 46.9 million (30%) people have still made no pension provision 

·          2.25 million (8%) people intend taking out a stakeholder pension

·          Less than half (49%) respondents believe that stakeholder pensions will encourage people to save for their retirement,

·          40% of employees without a stakeholder would speak to their employer when choosing a stakeholder, whilst more than two thirds of adults would prefer to consult an IFA before taking the pensions plunge, this desire particularly prominent amongst the all-important 18-24 age bracket

Elms concluded, “Once again our research highlights a huge demand for independent financial advice when making the most important investment decision in most people’s lives.  We are calling on the government to acknowledge the need for advice and factor this into the design of stakeholder pensions to ensure their future success.”  

To speak to an IFA about stakeholder or pensions in general, people should call the IFA Promotion freephone hotline on 0800 085 3250 or visit www.unbiased.co.uk where details of local IFAs will be provided.  Callers can also request a copy of IFA Promotion’s free guide to pension planning.

- ends -

For further information please contact:

David Elms, CEO   or          Pippa Russell/ Richard Winder

IFA Promotion             Lansons Communications

020 7833 3131             020 7490 8828

*  NOP Omnibus conducted Research during March 2002. 973 adults aged 18+ were interviewed using their Telebus survey. For more detailed questions regarding the research, call: Rachael Peace, NOP World, 020 7890 9365

** ABI press release 27/3/02


Notes to Editors

1.  Independent Financial Adviser Promotion

Independent Financial Adviser Promotion Ltd. was established in 1989 to promote the value and accessibility of independent financial advice to the public.  It represents over 10,000 firms of independent financial advisers across the UK and is sponsored by 28 leading financial institutions.

IFA Promotion’s central belief is:

“Consumers have a right to financial advice that is independent of the providers of financial products - i.e. independent financial advice.”

Furthermore independent financial advice should be:

·         Affordable.  The option to take independent financial advice should be available, by right, to all - not just the wealthiest in society.

·         Convenient.  IFAs should be available in the location of the consumer’s choice, wherever they live in the UK.

·         Transparent.  It must be clearly transparent to consumers who is able to offer independent financial advice and who is not.

2.       Independent Financial Adviser Promotion’s sponsors

AXA Sun Life

Prudential

Barclays Global Investors Funds

Scottish Equitable Plc

BUPA

Scottish Life

Canada Life

Scottish Mutual Assurance Plc

Clerical Medical Investment Group

Scottish Provident Institution

Eagle Star

Scottish Widows Plc

Friends Provident

Selestia

INVESCO Fund Managers Ltd

Standard Life Assurance Company

Legal & General

Swiss Life (UK) Plc

GE Life

The Skandia Group of Companies

National Savings

Tunbridge Wells Equitable Friendly Society

Norwich Union Life

Winterthur Life UK Ltd

NPI

Zurich Life Assurance Company

 

 

 

 

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