Ros Alt­mann of­fers ad­vice to younger peo­ple as the pen­sions cri­sis deep­ens

The Jewish Chronicle - - PEOPLE -

AS EM­PLOY­ERS con­tinue to cut back on private pen­sion schemes, for­mer Down­ing Street ad­viser Ros Alt­mann is warn­ing that younger peo­ple are par­tic­u­larly at risk of fac­ing an im­pov­er­ished re­tire­ment.

The num­ber of firms that are ei­ther shut­ting or re­duc­ing their con­tri­bu­tion to schemes — which pay a per­cent­age of a worker’s earn­ings on re­tire­ment — has soared to its high­est since records be­gan, due to in­creas­ing costs.

Com­pa­nies are re­plac­ing their tra­di­tional schemes with de­fined con­tri­bu­tion schemes which do not prom­ise any spe­cific amount. “The pen­sion we were re­ly­ing on from our em­ployer is dis­ap­pear­ing,” Dr Alt­mann, 52, tells Peo­ple. She ad­vises: “For young peo­ple with debts, it may be that they are bet­ter off pay­ing them back or sav­ing to buy a house, rather than au­to­mat­i­cally putting money into a pen­sion. They could save in an ISA in­stead as this money can be re­trieved. With pen­sions, once the money is in there, it is locked away and you can’t do any­thing to get it back.”

Dr Alt­mann, who was vic­to­ri­ous last year in cam­paign­ing for the gov­ern­ment to com­pen­sate mem­bers of col­lapsed pen­sion schemes, was re­cently named Pen­sion Pro­fes­sional mag­a­zine’s Pen­sions Per­son­al­ity of the Year for the sec­ond year run­ning. But she is not get­ting com­pla­cent. She is cur­rently cam­paign­ing to get the gov­ern­ment to change its pro­posed per­son­alpen­sion ac­count pol­icy — which will ap­ply na­tion­ally — to be in­tro­duced in 2012, re­quir­ing em­ploy­ers to pay just a min­i­mum of 3 per cent into pen­sion schemes.

“Th­ese ac­counts are ter­ri­bly dan­ger­ous. Em­ploy­ers are cur­rently putting in more than this but will be tempted to cut back to the min­i­mum. Peo­ple will be au­to­mat­i­cally en­rolled into th­ese per­sonal ac­counts but may be best ad­vised to opt out.”

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