One in five people (21 per cent) in the UK have already invested in cryptocurrencies, while more than one in four (27 per cent) would consider this as an investment option for their retirement plans according to research by Aviva.
If these numbers are accurate this means around 11.6m people in the UK to have already invested in cryptocurrencies, with 14 per cent of the population saying they currently hold some form of digital assets.
Aviva’s research found that around 18 per cent of those aged 25 to 34 have already invested in cryptocurrencies and digital assets.
Among those using their pension funds to invest in crypto, most (43 per cent) are motivated by the higher potential returns; more than a third (36 per cent) said they were excited by innovation and new technologies while 32 per cent said they wished to diversify their portfolio.
However, this interest is also tempered by significant concerns around security risks (41 per cent), such as hacking or phishing; the lack of regulation and protection around crypto (37 per cent) and the volatility in crypto trends (30 per cent).
Three in 10 (30 per cent) respondents are interested in crypto, but don’t understand the benefits they may be giving up by cashing in their pensions to invest in this asset. Meanwhile a surprisingly high number — 27 per cent — said didn’t realise there were risks involved in investing in these assets
The survey found that while there was growing awareness of cryptocurrencies there was still a widespread lack of understanding about pensions, despite these being a cornerstone of most people retirement finances.
Although six in 10 of those surveyed said they would be concerned about losing pension benefits if they opted out to invest in crypto, more than one in five (22 per cent) aware unaware of the tax relief and employer contributions available and, one in 10 (12 per cent) surveyed said they were unaware that their employer contributes to their pension.
Aviva managing director of wealth & advice Michele Golunska: “There are lots of different investment opportunities out there, and it’s easy to see why cryptocurrency has become so popular in recent years.
“But we mustn’t forget the value of pensions. It comes with some powerful benefits, like employer contributions and tax relief, that can make a real difference to people’s long-term financial wellbeing.”
