Course Highlights Huge Concern about Pensions in UK - Martin Upton

2 March 2015

Managing My Money, the free online course produced by The Open University’s True Potential PUFin Centre, is currently completing its second eight-week presentation on FutureLearn.

The course has, once again, attracted thousands of learners. It covers the spectrum of personal finances and provides guidance on how to bring order to household financial management.

During the presentation I was joined by my colleague and True Potential PUFin Centre member Jonquil Lowe in two filmed social events where we answered questions on personal finance issues posted by the learners on Managing My Money.

The learners’ questions give us a great insight into the personal finance issues that people in the UK are worried about. Well over 80 per cent of the questions were about pensions. Moreover the questions revealed widespread examples of poor – or no – pension planning.

Amongst the issues exposed were:

• A lack of awareness about how to take advantage of the greater freedom to access pension pots from this April and about the nature of the new regime for pensions – including the rights to pass on pension benefits to beneficiaries after death
• Poor knowledge about the rights to switch from one pension scheme to another and the costs involved
• Problems about how to evaluate different pension products
• Uncertainty about how to ensure your pension plans are on track to provide the desired pension income
• Issues about how to access information on schemes which learners had ceased to contribute to some years ago
• Uncertainty about where to go to find a financial adviser.

The unfolding changes to state provision – including the new 'flat-rate' state pension due to start in 2016 and the gradual raising of the state pension age (SPA) – seem to be adding to the confusion.

Amongst the issues where there appears to be a lack of clarity were:

• How does my national insurance contributions (NIC) record affect my entitlement to state pension?
• What is the impact of membership of a ‘contracted-out’ occupational pension scheme on my rights to state pension?
• What happens to the existing state pension arrangements when the ‘flat-rate’ scheme starts in 2016?
• Can I, and should I, defer my state pension?

The extent of the issues highlights the challenges to the pensions industry and the government in the coming months as the dual transformation of arrangements for private and state pensions unfolds.

At the OU’s True Potential PUFin Centre we continue to develop our free online education on personal finance.

A new free online course, Managing My Investments, provided with the support of True Potential LLP, will commence on FutureLearn on 11 May. Find out more and sign-up.

Before then the Economics department also launch their new free online course, Inequalities in Personal Finance: The Baby Boom Legacy on 23 March.

For those who missed the most recent presentation of Managing My Money the course is available free on the OU’s social learning site OpenLearn. Read more and register.

So why don’t you access these free courses and learn more about current and topical personal financial issues?

Martin Upton is Senior Lecturer in Finance and Director of the OU Business School’s True Potential Centre for the Public Understanding of Finance (PUFin), a pioneering Centre of Excellence for research in the development of personal financial capabilities. This post first appeared on the PUFin blog, and we are grateful for their permission to reproduce it.