Almost half of UK workers have never reviewed their pension plans, despite increasing concerns from the industry that contributions are not adequate for a comfortable retirement, warns Baring Asset Management (Barings).

While 16.8 million have never looked at their pensions, 1.03 million last did so over ten years ago; of these, 37 per cent do not know where their pension is actually invested. A further 6.67 million people (36 per cent) out of the total who have reviewed pension arrangements simply opted for the default option, taking the fund investment decision out of their hands. Eighteen per cent of these people said the option had been poorly explained or not explained at all.

"Many people give very little thought to their pension despite the huge importance it has in deciding of life in later years," commented Marino Valensise, chief investment officer at Barings. "A pension pot is often your second largest investment after a home, yet in many cases not a moment's thought is given to where the money is invested. It's like buying an expensive car without taking any advice on the make or model.

"Consumer behaviour will only change if the industry changes too and that means improving the way in which pension advice is given. Advisers need to help people view their pension as part of a wider retirement savings plan and think more clearly about levels of risk and return. Pension holders should get into the habit of reviewing their schemes on an annual basis and I would urge them to take independent financial advice."

Only 12 per cent of working people who have reviewed their pensions took note of recommendations made by their financial adviser on where to invest their pension pot, and a further 15 per cent selected the funds themselves.

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