Simon Read: Prepare for more pension tinkering

It will be the lasting legacy of the Chancellor that he introduced new pension freedoms

The Chancellor is making his Autumn Statement today. It’s become an essential part of the financial calendar, but even more so this year given that it’s the last one of this Parliament.

So George Osborne will have been told to ensure that there are some pleasing, vote-winning announcements today. I have no idea what they may be save for some more tinkering with the pension system. One rumour suggests, for instance, that he will cut taxes for widows and widowers who inherit their partners’ annuity pensions.

It will be the lasting legacy of the current Chancellor that he oversaw the dismantling of the pension system that had served for decades, by introducing new freedoms for retirement savers.

In truth they were long overdue, but the pace of change he demanded, presumably so that the new freedoms could be effective before next May’s general election, has left the pension industry reeling. The fears are that in his rush to please the electorate, Mr Osborne has simply created a mess that could cause unforseen financial problems for many.

With seemingly new rules and wrinkles being announced weekly by ministers and pension companies, it’s been hard to keep up. The changes have led to a whole new world of confusing buzzwords that have made it harder to know what to do for the best.

In recent weeks, for instance, we’ve had firms offering pension credit cards, while there have been warnings about pension liberation. Meanwhile, many of the bigger companies are working to launch pension passports.

I went to a pension expert, Fidelity’s Alan Higham, to find out what these terms mean – and what we need to do about them. You can see a video of my interview at ind.pn/1zLQn8c.

If you’re approaching 55, the age at which the new pension freedoms come into effect, then it’s essential to find out what you need to do now.

s.read@independent.co.uk

Twitter: @simonnread