A pension will boost your attractiveness

These are the kind of slogans the government needs to employ if we are to get Britons to save for their retirement.

Of course, reforms in abolishing compulsory annuity purchase and plans to offer free guidance are good news and should serve to make pensions more attractive. Yet it is still the case that many people are not saving for their retirement, and these changes, however revolutionary, may make little difference.

I accept these may not be the kind of people the average financial adviser comes across. But I have plenty of acquaintances who have woeful, if any, pensions. These include middle-aged mothers who last had ‘proper’ jobs way back before they started reproducing. Also, living in the country, as I do, there are many men and women who have several low-paid, sometimes seasonal, part-time jobs at the same time. Then there are others who are freelance and have no-one to encourage — or impel — them to save for their retirement.

What they have in common is that none has sufficient pension provision. They might have small entitlements built up from years ago. Or they might even put a little into a pension off their own bat or thanks to one of their employers. Whatever they have, even added up it is unlikely to offer any chance of a good retirement income.

So what are these people doing? Frankly, some are waiting for others to die, seeing inheriting their elderly parents’ home as the answer to their financial shortfall in old age.

Others are planning to sell their houses and downsize, maybe into a park home or a wigwam, when they are old. Some plan to carry on working until they drop, pointing out that the average age of the Saturday ‘girls’ at the local supermarket is pushing 70.

They are high-risk strategies. Relying on an inheritance is ignoring the possibility of your parent(s) spending all their money. Or they could leave it all to a donkey sanctuary. House prices can fall and health can decline, making work in later life impossible.

And there is always love, or its loss, ready to scupper any plans. Divorce or relationship breakdown has left several women I know in financially precarious positions.

Some are waiting for others to die, seeing inheriting their elderly parents’ home as the answer to their financial shortfall in old age.

I asked one, a lone mother in her 50s, with a full-time job but only a couple of years of contributing to a workplace pension, what she would do when she retired. She was defensive; she would sort it out, everything would be OK. It is the adult equivalent of putting your fingers in your ears and going la lala.

So how do you reach the unreachable and make them want to save into a pension? Compulsion helps, but it will not reach everyone.

But I think if the real advantages of pensions were explained, then putting money aside once a month might appeal to these refusniks. Few people, however badly off or disorganised, would not insure their home. Selling pensions as a way of ensuring your future is what is needed. Otherwise, there may be elderly people who need to watch out for butter on their staircases.

RDR choice simply adds confusion

The Retail Distribution Review was meant to simplify things. And perhaps it has in some ways: getting rid of the worry of commission bias can only be a good thing. But speaking as an amateur, to me it seems as if the RDR has added more layers of complication to buying funds.

Different share classes of funds have been multiplying like cells in a mad scientist’s Petri dish. One adviser points me towards the entry for M&G Optimal Income on the Morningstar website: it lists 15 separate share classes. That may be the most extreme example but it is hardly the only fund with multiple classes.

A surfeit of choice does not make things easier for go-it-alone investors, and I bet few IFAs are keen on the extra work deciphering all these share classes entails. It is hard not to think that, in this instance, the RDR is an example of Hutber’s law: that is, that improvement means deterioration.

Superyacht sales are on the up

Isn’t it nice to know that sales of superyachts are soaring? They were up a third in the first half of 2014, compared with 2013, with 221 superyachts (typical price, $150m (£89m) plus) sold, according to Boat International Media.

The rise is thanks to an increase in super-rich American buyers, joining the oligarchs mooring their floating palaces in the most blingtastic marinas. For those more in the pedalo class, treat it as a sign of improved global economic health, or whatever financial indicator floats your boat.

Charlotte Beugge is a freelance journalist