Despite being introduced over two years ago, 29 per cent of baby boomers still do not understand the freedom and choice pension reforms, a report has revealed.

According to a report by Dunstan Thomas, titled, Engaging with baby boomers’ retirement journeys, when asked how soon before retirement they would consider reviewing their pension-held investment/assets to reflect Defined Contribution pension decumulation choices, almost a third (29 per cent) of baby boomers said they did not understand the new options.

Since the pension freedoms were introduced in April 2015, anyone over 55 with a DC pension pot has the option to take their pension in cash, enter into a form of drawdown or take an annuity, which was previously was compulsory.

Furthermore, One in 10 are leaving the asset selection decision making entirely to their provider with a view to buying an annuity from them; while 19 per cent are planning to look at adjusting their portfolio 12-months before decumulation, which may be too late. Just 7 per cent planned to review asset and risk exposure levels at least five years before beginning drawing their pension.

However, the report found some evidence that the pension freedoms are triggering greater interest in people taking advice or guidance. Despite this, 36 per cent of the sample could no differentiate between regulated advice and guidance and only 17 per cent claimed to fully understand the difference.

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