You can do better in a share builder account. (Personal Pension Schemes in general)

Member Name: stokx

Product:	Personal Pension Schemes in general
Date:	16/02/09 (88 review reads)
Rating:

Advantages: Tax benefits.

Disadvantages: You are at the mercy of goverment and you have to take a view on annuity markets in future decades.

There is a vast and unjustified hype over pensions with every professional recommending the same product to everybody despite falling annuity rates.
Of course rates fluctuate and there will be excellent times to redeem pensions in the future but it is impossible to predict this 60 years in advance and there is little flexibility in terms of when it is practical for most people to buy, I will not be betting my retirement on it.
It is often claimed that pensions get tax relief; this is true on a technicality but the annuity is taxed so all you get is the performance on the deferred tax pounds (unless you are a high rate tax payer before retirement and a standard rate payer afterwards).
The performance of the pension is largely irrelevant as you can neither withdraw more than 25% of the money nor secure debt against it (normally).
A big risk is government policy which is hugely restrictive and can easily change. Means tested pension credit makes investing for income potentially counter productive.
My plan is to build an unwrapped equities portfolio and to change weightings towards zero dividend preference shares and some dividend free ordinary value shares which I will sell in chunks.

Summary: Too much political risk to bet your retirement.