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聯絡: Mags Andersen
電話: +44 20 7178 3513

			以電子郵件傳送網頁				列印本頁

UK
London, 5 July 2010

With surging annuity prices and the lack of market confidence in European economies, many employees may have to work longer than planned in order to retire on a reasonable income, according to calculations from Mercer. Mercer’s “DC Barometer”* shows how changes in annuity and investment markets, as well as contribution levels, can influence the expected retirement age and income of defined contribution (DC) pension scheme members.

Comparing stock market conditions and annuity price movements at the end of December 2009 with the end of May 2010, Mercer’s barometer shows that a sample scheme member planning for retirement may need to work around 15 months more in order to retire on the same income they expected based on conditions 5 months previously.

Steve Charlton, a Senior DC Consultant at Mercer, commented: “Employees who purchase their annuities now will get a poorer deal than those who retired only a few months ago. This is because of significant increases in annuity prices due, in part, to the turbulent markets following the debt crisis in some European countries.

“The considerable impact that swings in markets and annuity prices can have on people’s retirement income highlights just how hard it is to control the outcomes of DC pension investments - particularly when faced with uncertainty in some of the world’s major economies.”

Mr Charlton continued: “It’s important for employers to help their scheme members understand the risks involved with DC schemes so they can take appropriate action to protect themselves, in the interests of securing the maximum income in retirement.

“If the Coalition Government’s plans to increase the state pension age comes to fruition then the additional 15 months our sample member has to work would more or less coincide with the new state retirement age,” Mr Charlton added.

Notes for Editors
The DC Barometer looks at the impact of the movement in annuity rates, investment markets and contribution rates and is a measure of the pressure being exerted on DC savings as well as members’ ability to afford to retire when they plan to. The information is used to illustrate how a member’s plans for retirement might improve or worsen over time. The example used in this release is a member in his/her 50’s, with combined annual employee and employer contributions of 12 percent of salary (Mercer’s 2009 DC survey showed the average combined contribution level to be 11.9 percent) and an existing pension pot of £200k at December 2008.

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聯絡: Mags Andersen
電話: +44 20 7178 3513