Pensioners set to liberate an extra £1.5bn from pension pots in 2015

Monday 12 January 2015

• Over 50s hold 68.3% of all UK household wealth • £1.5 billion of pensions savings will be unlocked this year

Pensioners set to liberate an extra £1.5bn from pension pots in 2015

A Saga report shows that the nation’s over 50s hold a larger proportion of the UK’s assets than they did at the start of the financial crisis.  Also during 2015, thanks to the new pension freedoms, an extra £1.5 billion will be released for people to invest, spend or give away as they see fit.

Lance Batchelor, Saga’s chief executive said:

“It should come as no surprise that many people who have worked, saved and invested over a number of years have built significant wealth.  Saving and investing for the future benefits individuals, families and, through the increased spending power of older consumers, the wider economy.

“Greater pensions freedom is something that Saga has lobbied long and hard for on behalf of over 50s, so we were delighted when the Prime Minister first spoke about the proposed changes at a Saga event in March.  It is great that Government has recognised that people, who have saved hard, can be trusted to make decisions about how they make the most of their retirement savings. It is estimated that the new pension freedoms that come into effect in April 2015 will mean that an additional £1.5 billion of pension savings will be unlocked in that year alone.

“It will be important for people to make the best use of these pension freedoms. Getting the right unbiased advice or guidance about how much to spend, and how to invest for future needs, will be crucial for both the wealth and happiness of the over 50s”

The Saga study, commissioned from the independent Centre for Economic and Business Research (CEBR), found that the over 50s hold 68.3% of all UK household wealth (£7.8 trillion), 77.3% of all financial wealth (£1.2 trillion) and 66.2% of all property wealth (£2.5 trillion). This is a modest increase from Q3 2008 when the figures were 67.6%, 74.4% and 65.3% respectively. While this has been partly driven by increasing numbers of over 50s and rising property values, Saga’s research found that depressed bond yields and annuity returns have meant returns on savings have actually declined. Pensions wealth, meanwhile, also increased slightly since 2008 – from 70.3% to 70.8% (£3.4 trillion), but again, the new flexibility to access pensions savings is expected to soften this trend.

Ends

Notes to editors:

Report commissioned by Saga from the Independent Centre for Economic and Business Research (CEBR).

About Saga

Saga is a leading provider of products and services primarily tailored for customers over the age of 50 in the UK. The Saga brand has been carefully developed over the past 60 years to become one of the most recognised and trusted brands among UK consumers aged over 50. Saga is synonymous in the UK with the over 50s market and is recognised for its high quality products and services.  These include cruises and holidays, home and motor insurance, savings and share dealing and the UK’s award winning Saga Magazine.  Saga also provides domiciliary and primary healthcare services through Allied Healthcare.  In addition to more than 2.1 million active customers it has built a proprietary database of more than 10.4 million contactable names. 

About Saga Personal FinanceSaga Personal Finance offers a range of savings accounts, a share dealing service, a Saga-branded credit card, an equity release service for home owners over the age of 55, life insurance and annuity products, a long-term care funding product, and other financial products.  Saga has over £5 billion of customer deposits in its savings accounts. As of 31 January 2014, Saga customers held approximately 67,000 wealth products.

Saga Group also offers its customers legal services through Saga Legal Solutions, including wills and estate planning, probate services and conveyancing services.

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