Hargreaves Lansdown has called for sweeping changes to the structure of the pension system ahead of next month's Autumn Statement, proposing the government scraps pension tax relief and replaces it with a bonus system to help motivate young savers.
With a view to dropping the current system, the firm has proposed a ‘100 minus age' system where the government provides a percentage bonus on top of pension contributions equal to 100 minus the age of the contributor. As an example, a 25-year-old would receive a 75% top-up on their contributions while a 50-year-old would receive a 50% bonus. "We particularly like the fact there's a motivational dimension to it," Hargreaves Lansdown head of retirement policy Tom McPhail said. "There's a very clear motivational message to get on and do it now. It will still be a good deal next year, but ...
To continue reading this article...
Join Professional Adviser for free
- Unlimited access to real-time news, industry insights and market intelligence
- Stay ahead of the curve with spotlights on emerging trends and technologies
- Receive breaking news stories straight to your inbox in the daily newsletters
- Make smart business decisions with the latest developments in regulation, investing retirement and protection
- Members-only access to the editor’s weekly Friday commentary
- Be the first to hear about our events and awards programmes