The Pensions Advisory Service has found most people who contact them are clueless about how their retirement income will be provided.
Analysis of 1,500 enquiries to Tpas from April 2015 to February 2016 found 73 per cent thought the state pension would enable them to live comfortably in retirement, while one in five cited the state pension as their main source of income.
Three out of 10 people who approached Tpas admitted they did not know how much state pension they would obtain, while 31 per cent said they would not know how to acquire an estimate for this.
Tpas also stated there had been a 71 per cent increase in people seeking guidance since the introduction of pension freedoms a year ago, and in the last year it has dealt with more than 180,000 enquiries.
The most likely trigger prompting people to make an enquiry was reaching the point of retirement or beginning to receive pension payments, according to analysis of Tpas data.
The average age of those making enquiries is 59, with two thirds made by those over 55, indicating many consumers are still waiting until very close to retirement before taking action.
Those aged less than 40 accounted for just 8 per cent of enquiries, while men accounted for more than 60 per cent of all enquiries received.
The statistics from Tpas come just days after the Financial Conduct Authority revealed HM Treasury is planning to slash funding for Pension Wise by 27 per cent.
The guidance service’s budget as it exists will shrink by just over £10m, from £39.1m to £28.7m.
The funding cuts follow a decision by the government to merge the functions of Pension Wise with The Pension Advisory Service, but also because it spent £7.3m less in 2015 to 2016 than was budgeted.
Scott Gallacher, director at Leicester-based Rowley Turton, said so many people think the state pension would enable them to live comfortably in retirement because they either have a high state pension, or modest income requirements.
He said: “As 30 per cent don’t know their state pension and 31 per cent don’t know how to acquire an estimate, it may just be that 71 per cent are over estimating the amount of their state pension.
“I would agree with the majority that pensions are complex. It’s our job as advisers to make them simple.”
ruth.gillbe@ft.com