"The introduction of pension freedoms presents a fundamental challenge to workplace pension schemes," says Tom Selby, senior analyst at AJ Bell.
"This is particularly so in relation to setting an appropriate investment strategy," he adds.
Research from Prudential has found that, three years since the introduction of pension freedoms, more people are saving more than ever before with a view to a better financial outcome in retirement.
Research from the life and pension provider found 11 per cent of people who are over 55 and working say they have started saving into a pension for the first time, they have encouraged their partner to save more, increased their pension contributions or restarted pension saving since the rules came into effect.
Additional findings include:
- Nearly two out of three (64 per cent) of over-55s say they are confused by the regulations.
- The overwhelming majority (82 per cent) want an end to any further government changes to pension rules.
- Over two fifths (42 per cent) are concerned about running out of money during retirement while 41 per cent worry about paying for long-term care.
Mr McSweeney believes pension freedoms are the "biggest change" to workplace pensions in a generation. He explains: "Pension freedoms mean extra risks, and we will, over time, see many winners and many losers.
"While the freedoms provide flexibility and opportunities through more choices, they also provide greater complexity."
For Mr McSweeney, this means more people will make the wrong decisions - particularly if they are unadvised or do not take up the free guidance services that are on offer - and this will affect their standard of living in retirement.
simoney.kyriakou@ft.com
