Gareth James: Should we be encouraging drawdown savers to take a Pension Wise booster shot?

Gareth James thinks more needs to be done to embed – but also develop – what people have learnt from their Pension Wise appointment

It’s seemed over the last few years that the higher the profile of a current event, the greater has been the polarity in opinions offered up to the general public.

Whether the topic has been Brexit, Black Lives Matter, or even the recent social care funding debate, it’s felt as though those offering moderate or nuanced views have struggled to make their voices heard, at least above those who’ve been unwilling to listen to alternative points of view.

Perhaps the most significant recent example of this phenomenon has been Covid-19, and in particular the topics of compulsory vaccination and vaccination passports.

It doesn’t feel like too much of a stretch to me to draw comparisons between the debates around vaccination compulsion and the arguments around compulsion for individuals to take Pension Wise appointments before taking benefits from their pension.

Coincidentally it was a month to the day after I received my second jab that I was able to attend an appointment with Pension Wise.  My immediate reaction was positive, and I’d encourage others to take the opportunity to attend.  However, does my own positive experience of Pension Wise mean I think that others should be compelled to attend? No – even though I’d encourage savers to attend, I don’t support compulsion.

Some individuals will feel sufficiently informed that they don’t need to attend – arguably a position I could have taken myself! Others may only be accessing what may be an insignificant part of their pension benefits and so prefer to wait. There are numerous other reasons why savers might make the personal choice not to attend.

One point that has occurred to me since attending the Pension Wise appointment is that I can’t remember much of the detail of what I was told – and we’re only talking three months since my appointment.  

That may be a reflection of the way in which my memory works, or rather fails to work!  However, I think more needs to be done to embed – but also develop – what people have learnt from their appointment. Just as the initial Covid vaccinations don’t appear enough and we are now contemplating an annual booster, maybe one Pension Wise appointment isn’t enough and we should encourage individuals to seek a booster guidance appointment.

My view on this isn’t based solely on my own failing memory, but also because the focus of the initial Pension Wise appointment is on options at point of access, with much less focus on managing investments and withdrawals once a choice had been made (assuming that choice involved entering drawdown).

Choices in drawdown don’t begin and end, as they do with annuities, at the point of purchase. For many their journey in drawdown will last decades, meaning action needs to be taken to provide support throughout that journey, not just at the start.

It feels as though we need to accept that we’ll be living with Covid for years, if not decades, with regular booster top-ups in protection – at least for those who choose to accept them. Millions of savers will be living in a drawdown world for decades as well, and the support framework should be designed to improve protection for the individuals who want it in the retirement arena as well.

Gareth James is head of policy at AJ Bell