Pension advice given to millions ‘is incorrect’
Numerous individuals might be planning their retirement according to incorrect advice thanks to “bungling” MPs have warned.
The Commons Work and Pensions Committee said details sent out about when people can get state pensions and just how much they’re value were “insufficient” and “confounding”.
It warns this especially applies to women, whose pension age is changing in the near future.
The DWP said it was working hard to help the population comprehend the problems.
One lady told the MPs she’d received a letter from the Pension Service in 2005 that failed to mention her retirement age.
In 2012, two years before she believed she was entitled to her pension (her 60th birthday); she received another letter saying she was not entitled to draw that until she reached 66.
“This miscommunication raises the opportunities that individuals misunderstand the worth of the state pension or the age that they are going to receive it. In turn, this raises the possibility that they’ll not have an ideal retirement plan.”
The committee said statements needs to be fitted on to one page, with key messages highlighted in clear view so there’s no potential for misunderstanding.
They need to list the present value of the state pension built up alongside the age at which individuals will be able to claim for the income, as well as the way they are able to build up retirement funds.
Frank Field, the committee’s chairman, said: “Consecutive governments have bungled the essential obligation to inform women of the important changes to when they are able to anticipate their state pension.”
“Retirement expectancies are crushed as many women have just been told a few years prior to the date they expected to retire that no such retirement pension has become accessible.”
“We’re dedicated to ensuring the public recognizes the positive changes being made to the state pension. We have already made huge steps – including TV, radio and print advertisements – and this action will continue over the forthcoming months and years.”