The pensions minefield

The world of pensions seems to get ever more complex and the Chancellor's recent budget has just added another layer of difficult decisions for the saver and retiree.  Stuart Jeffries in the Guardian has written an entertaining guide to help you understand what's going on.  The tone is somewhat cynical:

"David Retikin, director of operations at international investment specialist Pryce Warner International Group, was asked to comment on Osborne's budget ruling that pension holders need no longer buy annuities, he said: 'The budget now has most savers and investors assessing the best course of action by carefully reviewing their existing investment strategy.'

Superb optimism, Mr Retikin. ... He went on: 'Casual savers are optimistic, perhaps even overjoyed to learn that they'll benefit from the changes he's introduced.' Let's look at three words in that sentence – 'optimistic, perhaps overjoyed' – and replace them with 'dubious, probably baffled'. "

Low interest rates, poor annuity returns and the string of financial industry scandals may well be thought to justify the cynicism.  Jeffries ends on a point that may be troubling a lot of people:

"Why do we have to have private pensions at all when they involve so much of our contributions being gambled away on the stock market or funnelled into bonuses for fund managers, while the value of our pensions pots have been eroded? Wouldn't it have been better if all the money I've paid into pensions over the decades had gone to a not-for-profit organisation I could trust that invested those monies in things like hospitals, schools, railways and the rest of Britain's infrastructure? A rhetorical question, to be sure, and a crazy, financially naive dream, no doubt. But I freely admit, I'm not a pensions expert."

It would be interesting to hear any responses from true pensions experts.