There is no acrid smell of smoke, no choking kerosene, no grim scene of forsaken battlefields and no ghastly flashbacks.
You cannot touch or a feel a pension, but you certainly know when it has gone.
Yet more people have been directly affected by pensions crises in the past four decades than those who lost their lives in the Afghanistan and Iraq wars.
Penury in old age kills with the ruthlessness of the most desperate terrorist.
I calculate at least 5m people have had a shadow cast over their pension rights since 1989, the start of my career as a pensions journalist.
Disasters include Maxwell’s theft of his workers’ pension, 3m people sold the pup of personal pensions when most of them had much safer final salary pensions, not to mention the ongoing pension transfer debacle and the blue-chip Equitable Life closed for new business leaving 1m policy holders’ retirement in tatters.
Uncertain future
That is the past but that must not be our future. According to Aviva, a record 9mn people will reach pension age in the coming decade, many of them relying for the first time on defined contribution pensions. Too many are floundering.
Financial Conduct Authority statistics show that 43 per cent people are making withdrawals form their pension pots at an annual rate of more than 8 per cent of the pot. That spells trouble.
Advisers are more crucial than ever before in cash flow modelling, asset allocation. But regulated advisers alone will never be able to service the needs of 9mn retirees.
Indeed, only 8 per cent of UK adults (4.1mn) have received regulated financial advice in the past 12 months, while 28 per cent (14.7mn) have used information or guidance.
According to LCP, poor pension choices at retirement under the pension freedoms cost savers £2bn. Around 550,000 people between April 2015 and March 2020 withdrew their pension savings, moving them to a bank account, losing out on both investment growth and inflation protection.
Retirees left to their own devices may face huge, unforeseen but often avoidable tax bills.
Perhaps one point of light in all this gloom is the rise and rise of tech, with more automated income strategies, which replaces people having to decide their own investment allocation and income options.
Another possibility is to expand the corporate advice sector. Many experienced company pension managers and trustees at FTSE 100 companies are scared to give any guidance at all for fear of straying into regulated advice territory, and the consumer is all the worst for it.
Perhaps employers of more than 100 staff should be legally obliged to give financial education for their staff or pay for regulated advice for their staff on reaching 50. This would be a huge opportunity for advisers who could scale up their offerings.
Insurance companies and retail platform providers could also do more here but are hemmed in by unnecessarily restrictive legislation on what they are allowed to say, with the unintended consequence that consumers are too often pushed into the hands of scammers who rip them off.
