More than half of pension scheme savers aged over 50 are missing tell-tale signs of potential scams and risky investments, according to research by Zurich.
Its survey of 1,011 people in defined contribution (DC) pension schemes found that 38% of respondents would not be suspicious of an unsolicited letter, while 22% not being dubious of an email, and 13% would not be concerned if they were sent an investment opportunity by text message or via a knock at the door.
It also found that 54% of respondents would be likely to consider a series of investments for their retirement savings from a typical list of pension scams if approached by an individual or company.
But despite this, 17% of respondents over the age of 50 say they are not worried about falling victim to a scam.
In addition, more than a third (38%) of over 50s would be willing to consider a free review of their pension when asked to consider a series of ‘investments’ for their retirement.
Around 23% would also consider an investment scheme offering annual returns over 8%, while 14% of respondents would consider a legal loophole to pay less tax.
Only 36% said they would not consider any of the schemes.
Gary Shaughnessy, chief executive officer of Zurich UK Life, said: “Savers who miss the warning signs of a potential pension scam risk losing some or all of their hard-earned savings.
“Retirees should be on their guard against firms which contact them out of the blue offering a free review of their pension or an investment which sounds too good to be true.
“It pays to be cautious when making any decision on retirement savings. Our advice is to reject cold calls, check with the Financial Conduct Authority (FCA) or Pension Wise and always seek trusted financial advice.”
The findings raise concerns that some savers could be more vulnerable than they think following the introduction of the new pension freedoms which came into effect on 6 April.
According to expatriate financial services firm AES International, British expatriates are among the most vulnerable to pension scammers following the introduction of the pension flexibility rules.
James McLeod, head of pensions at AES International, said: “Retirees who are based overseas, or who are planning to retire in the sun, need to be very careful about what they do with their precious retirement savings.
“Unfortunately there are many unscrupulous salesmen who specifically target expats because they are not very well protected in many countries by local laws.
“We urge anyone considering making any decisions to check to make sure the firm they are dealing with is regulated and would say that if [they] are unsure do not do anything. It takes a lifetime to build a pension, but only minutes to sign it away.”
