Avoid relying on property to fund retirement, says FCA Chief Executive
The Chief Executive of the Financial Conduct Authority has cautioned workers against relying on property investments to fund their retirements.
Andrew Bailey said the risks of concentrating investments in property were too great and advocated a more diverse portfolio of investments. He said it was important for public officials to present more clearly the relative risks of property and pension investments.
His comments come in the wake of increasing interest in property investment as an alternative to the current low returns from pension schemes.
He said: “Retirement saving and pensions is one of the largest issues we face. It needs to be considered broadly.
“There are some very big issues at stake here: the balance of who takes the risk, between the state, employers and individuals, with the balance shifting to individuals; the potential for large inter-generational shifts in income and wealth; and the impact of heightened economic uncertainty on the ability to write long-term financial contracts which embed assumptions on future returns.”