Brexit could turn public off pensions
There is a risk savers could be "dissuaded" from starting their pension or increasing contributions as a result of Brexit, warns Natixis Global Asset Management.
Following the publication the firm's fourth annual Global Retirement Index, deputy chief executive of international distribution Chris Jackson argued confidence in pensions could weaken.
Potential short- to medium-term consequences of Brexit include the depreciation of sterling, lower investment returns, erosion of retirees' income and general volatility.
Jackson (pictured above) said: "If you combine these effects, there is a risk individual savers are dissuaded from increasing their pension savings or starting their pension savings."
Pensions have been improved by automatic enrolment (AE), which introduced compulsion to save combined with flexibility to bypass the straightjacket of annuities, he added.
He believes these policies partially explain the findings of the retirement survey where the UK rose five notches in the world rankings of retirement security to 17th place from 22nd a year ago.
Some 74% of those surveyed in the UK realise they have to take more responsibility for their retirement.
It is important Brexit does not undermine these positive developments, he said. "Now is not the time to stop the momentum from a regulatory perspective and we should be encouraging people to save, give them financial education and help them achieve retirement goals. We should be creating portfolios which are diversified and allow people to ride out the market volatility," continued Jackson.
The Global Retirement Index also finds Western European nations dominate the top 10 positions with Norway in first place.
Remaining countries include Switzerland, Iceland, New Zealand, Sweden, Australia, Germany, Netherlands, Austria and Canada.
This year's survey is an analysis of 43 countries which considers 20 drivers of retiree welfare. It was compiled by Natixis with support from CoreData Research.
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