The Financial Services Compensation Scheme (FSCS) has warned that 40 per cent of those saving into a pension have not checked to see whether it is protected in the event the provider goes bust.
Research from the lifeboat scheme, published last week (January 26), found the main reason savers had not checked whether their pot is FSCS protected was because they “didn’t have the time” or “didn’t know how to”.
It also found that one in seven of the 2,000 people surveyed (12 per cent) were unaware of when they last checked the balance of their pension, with a further 20 per cent admitting to having never checked.
The FSCS is making savers aware that they can use its pension protection checker tool to find out how much protection it may offer on their pensions.
Caroline Rainbird, chief executive of the FSCS, said: “While we don’t need to be checking our pension pots as often as our day-to-day accounts, it is important for people to know how much is in them, so they are aware whether they are on track to be able to afford their retirement dreams.
“When they are checking their current pension savings or thinking about making a change to their investments, it is also important to know their money is protected if something went wrong, for reassurance and peace of mind. That is why we’ve developed our pension protection checker – to make it quick and easy for people to check.”
Advisers have seen their FSCS bill rocket in recent years due to firm failures and rising claims in the pensions and investments market.
The lifeboat scheme has forecast a levy of £900mn for 2022-23, and advisers will yet again contribute the maximum £240m.
But it cut its levy for the current year (2021-22) to £717mn, lower than the £833mn levy announced at the last forecast in May.
This was because the £116mn contribution from the retail pool was no longer needed.
amy.austin@ft.com
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