The Pensions Regulator's (TPR) new guidance for members shopping around for retirement products is ‘still not enough', according to Tom McPhail, head of pensions research at Hargreaves Lansdown.
The new guidance, Making Your Retirement Choices, aims to improve member knowledge about the retirement market, and help them understand their right to shop around for annuities and other retirement vehicles.
Currently, only 23% of members shopped around for their retirement products.
McPhail says: "This guidance is a step in the right direction as TPR is trying to encourage better use of pension pots. It is good, but it is still not enough.
"There is no fundamental shift towards shopping around for retirement options being the default, and until we get that, we will not change the rate of OMO uptake."
Bill Galvin, TPR acting chief executive, says: "Our research shows that standards of information are mixed. Retirement literature should grab members' attention, and motivate them to take action, rather than putting people off with jargon or legalese.
"Whilst the legislative requirements provide an important safeguard, we want to see trustees and providers delivering simple, readable information that helps members to maximise their retirement income."
Pensions minister Steve Webb added: "I want to see trustees and providers really encourage members to make good choices."
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