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Pension worries a global concern.

Byline: By Matt Williams

More than half of working-age adults in developed and developing countries are ill prepared for the financial strains of retirement, it was claimed today. A survey of pre-retirees in 23 countries found that 60% worry that they have insufficient money set aside for old age, while 48% of pension age citizens said they regretted not saving more.

Insurer Aviva published the findings of its Consumer Attitudes to Savings survey to coincide with the launch of - a retirement planning website supported by Government and consumer groups.

Figures for the UK showed that 43% of adults were concerned over the current level of their retirement fund with just under a third not planning to use their savings for old age.

The surge in house prices in the past half decade has seen an increasing number of people look towards the property market to supplement their retirement income.

Just under 60% of UK workers view their home as an 'investment for the future', the survey found.

Aviva said the statistic prompts fears that if property prices should take a tumble, people could lose a vital source of retirement income.

This concern is also present in Ireland and the US, with citizens in both countries becoming more reliant on property prices.

Half of pre-retirees taking part in the survey said they expected to work beyond retirement age. Richard Harvey, group chief executive at Aviva, said, 'Our research shows that the pensions black hole is not just a UK-specific issue but an area of global concern.

'Broadly, the world's pre-retired population seems to have resigned itself to the fact that the term 'retirement age' may not apply to a specific age and will become increasingly ambiguous.'

To help people plan for retirement - an impartial website offering pension advice - has been launched by Aviva.

Ed Balls, Economic Secretary to the Treasury, said, 'We want everyone in society to have access to, and use, financial services with confidence.

'Financial decisions can be difficult, financial products are complicated and there can be too much jargon.

'This puts people off, or they can end up buying something that is not right for them. Sometimes people just want to discuss their financial options and not buy anything. 'We believe there is a gap in the provision of this last type of advice - generic advice - and we are pleased to see playing a role in this area.': Stakeholder rule stays:Plans to scrap a rule forcing pension advisers to tell clients about low cost stakeholder schemes will not now go ahead, the City regulator said yesterday. The Financial Services Authority (FSA) said the requirement, known as RU64, will be kept despite earlier indications that it had been ready to drop the rule.

The decision was welcomed by consumer groups but condemned by the pensions industry.

RU64 was incorporated into the FSA handbook in 2001, compelling advisers to explain to a customer in writing why the personal pension they were recommending was at least as suitable as a stakeholder scheme. It is aimed at preventing clients from being put on high-charging private pensions.
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Publication:Western Mail (Cardiff, Wales)
Date:Feb 28, 2007
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