PensionsSep 2 2014

Women don’t value financial advice: MGM

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Women are likely to be hit hardest by the retirement reforms announced in this year’s Budget, as they are not only less likely than men to seek or value financial advice, but are also less aware of what is available to them.

MGM Advantage has warned that despite the new freedoms, its research suggests women may fail to make the best decisions about financing their retirements.

An online poll by Research Plus among 2,060 UK adults aged more than 55 and 2,028 UK adults aged 18 plus showed 40 per cent of non-retired women aged over 55 would value expert financial advice when retiring, compared with 52 per cent of similarly aged men.

This is despite women being more worried than men about not having enough money to make ends meet in retirement, with 49 per cent of UK women saying this is a concern, compared with 39 per cent of UK men.

However, almost half of women aged 55 plus said they were unaware of the products and services available to them to generate retirement income, compared with just a third of men who were the same age.

This age group of women were particularly in the dark when it came to additional pension income that could be available, with 19 per cent aware that annuity providers offer additional income for certain medical conditions.

In addition, women approaching retirement underestimate their life expectancy by an average of 10 years, considerably higher than men’s underestimation of five years.

Andrew Tully, pensions technical director at MGM Advantage, said: “It is worrying that women don’t seem to value expert advice to help them plan for their retirement as much as men do and are likely to make decisions about financing their retirement by themselves, with some spending less than 24 hours making these life-defining decisions.

“The recent reforms have given retirees more freedom and increased their choices, but this means decisions are more complex, so understanding the options available is more important than ever.

“There is a real risk that without expert advice, people approaching retirement, especially women, may receive a poorer outcome than before the reforms.”