Seven million people take pension action during lockdown

The insurer revealed 37% of pension savers - equivalent to seven million people - have taken action relating to their pension including checking the value of their pots, withdrawing money, changing where a pension is invested, and increasing or decreasing pension contributions.

With the lockdown creating additional time for people to think about finances, Aviva's research - which questioned 2,020 UK adults - found almost a third (29%) of UK adults are reviewing their spending habits more closely than they had previously done. Additionally, 16% agreed lockdown has prompted them to think about their pension more.

Despite the millions of job losses and the increased uptake of universal credit, just 11% of adults with pension savings have decreased or stopped their contributions, according to the research, while 8% have looked where their pension is invested and 5% have increased their contributions.

A further 6% of people surveyed noted they had decreased their pension contributions, but were continuing to save money in another way.

Aviva revealed men were more likely to have checked their pension value and investments than women, at 27% and 18% respectively, but were 5% more likely than women to have decreased or stopped their contributions altogether.

The financial impact of Covid-19 has caused one in ten (10%) workers aged 45-55 to delay their retirement plans, while almost half of the same age group revealed they are lacking confidence in their current financial situation, compared with 38% across all adults. However, a small proportion (6%) noted the impact of Coronavirus will make them consider retiring sooner than planned.

Aviva head of savings and retirement Alistair McQueen said people paying closer attention to their pension performance and savings habits "is very promising to see" and "vital that this behaviour becomes the ‘new normal' post lockdown".

"But while it's good practice to pay close attention to their finances, this shouldn't necessarily mean they need to take action. While it may be concerning to see COVID-19 rattle the market, long-term investors - like pension savers - should be careful not to over-react. Volatility in the stock market is normal and markets often rebound quickly, and decisions made in haste and under stress are rarely good ones.

"People need to base their considerations on their own situation and not on the headlines. They may be able to look at their pension or ISA online and view their investments that way, and with this information they may want to consider rebalancing their investments, to ensure their risk is spread.

"But if people are unsure about what to do, their best investment could be to seek some professional financial advice. An adviser's expertise should help to navigate situations like the one we're in and, while there may be a charge involved, the peace of mind this brings carries value in itself," he added.

McQueen continued: "The ongoing COVID-19 pandemic has caused financial difficulties for many, and for thousands of middle-aged people retirement plans are likely to be put on hold. Employees today are already working longer than generations before them, but as savings plans are likely to take a hit due to sweeping changes to circumstances, many are now facing the possibility of having to work for longer to enable their finances to catch up."

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• Topics
• Industry
• pension withdrawals
• Alistair McQueen
• Aviva
• Covid-19