Simon Read: 'Computer chaos confirms the importance of branches, but there's much unhappiness about pension planning'


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The Independent Online

The continuing troubles experienced by customers of NatWest and Royal Bank of Scotland (not forgetting Ulster Bank) this week rather pointedly demonstrated how important it is to have a decently-sized bank branch network.

With an estimated 12 million customers hit by the massive computer cock-up that left salaries and payments uncredited to accounts, many reported having their debit cards barred at tills.

To help customers, the bank kept 1,000 or so branches open to 7pm on Thursday and last night so they could get at some of their cash. It was the least they could do. But without the branches, they wouldn't have been able to offer even that basic help and would have left many people stranded with no access to cash at all.

After my article last week questioning whether we still need bank branches, NatWest's computer chaos serves as a strong argument for keeping them. And judging by my bulging postbag this week, a lot of you are in favour of keeping branches too.

However, if they are to be useful then their hours must be changed, as happened with the extended opening this week and weekend.

"Branches must be open when customers can get to them," wrote Robert Oliver of Grays in Essex. "Those of us who work out of town cannot get in at lunchtime and do not want to take a half-day just to visit the bank."

I suspect banks will listen to that and – in some places – introduce branches with longer opening hours.

Fabian Acker, meanwhile, emailed to complain about music being played at his bank branch.

"HSBC has introduced background music so it is impossible to carry out even the simplest transactions in branches without raising your voice," he reported, calling the music "the same background noise that you get in a third-rate supermarket".

HSBC has had the music for a couple of years and says most customers welcome it.

What do you think?

I also had a lot of feedback from readers about my column last week suggesting that people need to start their pension planning as soon as possible if they want to have any choice when they reach retirement age.

Paul Bunting of Worthing in West Sussex agrees with the principle – which the Government is promoting with its new, auto-enrolment scheme to be launched this autumn – that all workers should pay into a pension scheme.

He wrote: "I think pensions should be compulsory, with contributions starting with the first pay packet."

Mr Bunting concedes that many young people struggle to afford pension payments, but added: "Save they must, for delay can be extremely expensive and complete denial can mean terrible impoverishment in retirement."

I'm taken to task by Susan Wood of Sheffield because of my pension advice and another article I wrote last week about the pain still being experienced by Equitable savers.

"Taken together, these two articles are inconsistent," she wrote. "The Equitable savers did exactly what you are exhorting people to do. But we got shafted."

They're not the only ones, of course. There are plenty of fed-up pension savers who have seen their retirement pots shrink in recent times while they have been told they will have to wait much longer than anticipated for their state payouts.

"We used to believe in the importance of saving for pensions," Ms Wood said. "But our experience has shown that, when even the Government cannot be trusted to regulate, it's too risky.

"We are therefore telling our younger relatives that saving for pensions is a mug's game."

I can't agree with the last point. Yes, millions have been let down by the likes of Equitable, or by losing valuable retirement benefits when their company scheme has switched from final salary to money-purchase.

But that doesn't mean anyone can afford to ignore the inevitable. And it is inevitable that – if we live that long – we will need money to spend in retirement.

We're not going to get it from the state, so we will have only what we can provide ourselves.

Mr Bunting points out that some people who work for themselves may have an alternative solution.

"Many traders can sell their businesses to finance their retirements, so they have a way out."

The rest of us are unlikely to have an asset to sell to raise cash to do the things we want to when we retire. Which is why it's important to save. It doesn't have to be through a pension scheme – although the tax benefits make it attractive.

An important thing to remember about a pension is that it is just a savings scheme, but for a specific purpose. It's entirely possible instead to build up a nest-egg through ISAs or normal deposit accounts, or even using alternative investments, such as gold, wine, vinyl or whatever.

The key is to save. Anyone who fails to do so will suffer in later life.

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