Savers concerned government will scrap pension benefits

Some consumers are concerned that the government could make tax changes that will affect their pension savings, new data from AJ Bell has revealed.

Its study found that 15.5 per cent of savers were worried that the removal of pension death benefits would impact their savings.

Furthermore, when asked if they were worried about any tax changes that might affect their savings products, a further 15 per cent cited a removal of higher rate tax relief on pensions as their primary concern.

Despite this, 50 per cent of those surveyed said that they had no concerns about tax changes that might affect their savings.

Around 16 per cent believed that a simplification of the pension rules would encourage them to save more, while 10.8 per cent said that understanding pension rules was what they found most complicated about managing their investments.

Commenting on the survey, AJ Bell senior analyst, Tom Selby said: “The fact almost a third of savers are worried the government will cut pension tax relief and 24 per cent fear a reduction in the ISA allowance perhaps suggests expectations of hand-outs are in short supply.

“Despite this there are some simple steps both policymakers and the industry can take to help struggling savers.

“There is clearly plenty of demand for simplicity, both in the products consumers receive and the rules that govern them, and regulators and ministers should take note of the fact 29 per cent of customers say fewer changes to the rules would encourage them to save more.”

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