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One of the UK’s largest asset managers has called on the government to allow savers to access their pension early if the money is used for a deposit on a home. 

Schroders and the Pensions Management Institute, an industry group, have proposed a “national lifetime savings plan”, enabling early access to retirement savings for first-time buyers as part of an overhaul of the way people build and use their wealth. 

The move comes as the new Labour government launched a review into pensions adequacy, with plans to explore ways to improve retirement outcomes. 

“Even when you take pensions freedoms into account, the UK’s long-term savings system is unusually inflexible,” said Schroders in a report published on Tuesday. The report pointed to Singapore, the US and Australia as examples of countries which allowed early access to pensions for housing and financial hardship.

In the US, 40 per cent of members of 401(k)s, the popular workplace pension plans, typically take out a loan against their pensions at some point, according to Schroders’ research. Meanwhile, in Australia, members can take up to $15,000 out of the First Home Super Saver scheme each year up to a lifetime limit of $50,000.

Currently, savers with defined contribution pension pots must wait until age 55 to access their savings, with this threshold rising to 57 from April 2028. Pension cash taken before the normal access age faces punitive tax charges.

The UK offers a Lifetime Isa to help savers aged between 18 and 40 with home deposits. But Lisa contributions are limited to £4,000 per year. The government applies a 25 per cent bonus instead of tax relief and the funds must be used for a property worth up to £450,000 or a 25 per cent withdrawal charge applies.

Schroders’ report argues that while long-term savings should be encouraged, allowing people to access some of their pension early if it goes towards a house deposit or pays off bad debt can make them better off in the longer term.

“The number of people renting in retirement will triple over the next 20 years . . . the financial impact is enormous,” said James Barham, executive chair at Schroders Solutions.  

For a renter to achieve the same standard of living in retirement as a homeowner, the Pensions Management Institute estimates that they would need to save an extra 9 per cent per year into their pensions over their working life.

“If you have all your savings in a pension but don’t buy a house, you have no hope of a good retirement,” said Sir Steve Webb, a former pensions minister who is now a partner at actuarial adviser Lane, Clark & Peacock. 

Schroders’ proposal for early pensions access for housing and to pay off bad debt comes as part of a wider plan for savings, which includes calling on employers to provide a facility for employees to contribute to a “rainy day” savings product, perhaps within an individual savings account, if the employee agrees.

Experts said that if people knew they could access their pensions for money to pay for a home deposit, they might be more comfortable increasing their pension contributions.

“This proposal accelerates and evolves the use of the UK’s automatic enrolment [pension] framework to meet the needs of modern society whilst also addressing the lifetime savings challenge,” said Ruston Smith, chair of the Pensions Management Institute.

Schroders’ intervention comes as the UK continues to face a pension saving crisis.

According to research from Phoenix Group, a pension provider, 17mn adults in the UK aren’t saving enough for the retirement they expect.

Against this backdrop, some experts believe allowing pensions to be accessed early for home deposits could muddy the waters. “Pensions are designed to provide a retirement fund first and foremost and there are other schemes designed to help you buy a house,” said Jason Hollands, managing director at wealth manager Evelyn Partners.

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Chinese stocks hit their highest level in more than two years on Tuesday as Beijing pledged more support for the economy and investor expectations for further stimulus remained high.

The mainland blue-chip CSI 300 index opened up 10.8 per cent after being closed since last Tuesday for a weeklong holiday. It fell back to trade 7 per cent higher in late morning as Beijing stopped short of unveiling significant new fiscal stimulus.

Expectations had built among investors that Chinese officials would outline further support for the economy to complement a monetary stimulus launched at the end of September, which sent Chinese equities soaring to their best week since 2008.

Hong Kong’s Hang Seng index, which was open for most of last week, fell as much as 9 per cent in the morning session after rising 11 per cent over the previous 5 days.

“Now [that] the mainland is open, people are selling Hong Kong to fund buying the real deal [mainland Chinese shares],” said one Asian trader who did not want to be identified.

China’s policy rally has restored a measure of optimism into the country’s stock markets. Global financial institutions including Goldman Sachs, Citi and HSBC have grown more bullish and raised their targets for Chinese equity performance.

Zheng Shanjie, chair of the National Development and Reform Commission, China’s state economic planner, told reporters in Beijing on Tuesday that he had “full confidence” the country would reach its official full-year growth target of around 5 per cent.

He pledged to prioritise consumption and expand domestic demand, as well as giving deeper support for China’s poor and students.

Zheng also said the Chinese government would keep issuing ultra long-dated sovereign bonds in 2025 — an indication of more support for the economy.

He said the government would front-load about Rmb200bn ($28bn) from next year’s budget for spending and investment projects. He also signalled a faster pace of bond issuance to support growth.

But Alicia García-Herrero, Natixis chief Asia-Pacific economist, said the market would be disappointed by the lack of “new” fiscal spending.

“This is what happens when you feed the monster,” she said. “Every day you need to increase the amount of food or it turns against you.”

China’s prospects of hitting its full-year GDP target, which is the lowest in decades, have been called in to doubt this year as President Xi Jinping’s administration struggled to reignite confidence among consumers and businesses in the world’s second-biggest economy.

Earlier on Tuesday, the World Bank said it was maintaining its 4.8 per cent growth projection for China for 2024. The multilateral lender projects China’s GDP growth to slow next year to 4.3 per cent.

Aaditya Mattoo, World Bank chief economist for east Asia and the Pacific, said that the stimulus measures of recent weeks were “not a substitute for the deeper structural reforms needed to boost longer-term growth”.

“Given the lead time for fiscal policy implementation, most of the measures [and] bond proceeds will carry over into next year,” he said. “And even then, consumers may be reluctant to splurge because a one-time transfer would not boost longer-term incomes or address concerns about ageing, illness and unemployment.”

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Samsung Electronics has issued a public apology and acknowledged the company is considered to be in “crisis”, following the release of worse than expected profit guidance on Tuesday.

The South Korean chip giant reported a preliminary operating profit of Won9.1tn ($6.8bn) for the third quarter, undershooting market expectations of a Won10.3tn profit, according to LSEG SmartEstimates.

While its expected operating profit has almost tripled compared with the same period a year ago, following a surge in memory chip prices, it is down almost 13 per cent on the second quarter of this year.

The company’s share price has fallen by almost 30 per cent over the past six months amid growing concern over its competitiveness in cutting-edge chips used in artificial intelligence systems.

“The leadership team at Samsung Electronics wishes to apologise for not meeting your expectations with our performance,” Young Hyun Jun, the head of Samsung’s chip division, wrote in a letter to customers, investors and employees on Tuesday.

“We have caused concerns about our technical competitiveness, with some talking about the crisis facing Samsung. As leaders of the business, we take full responsibility for this,” said Jun, who took over the division in a management shake-up in May.

The worse than expected guidance on Tuesday underlines investor concern about deteriorating memory market conditions and the possibility of slowing AI investment by big tech groups, though some concerns were relieved by Micron Technology’s recent upbeat forecast for the current quarter.

“Concerns are growing as legacy memory demand is slowing and smartphone demand is weaker than expected while its entry into the [advanced high-bandwidth memory] HBM market gets delayed compared with rivals,” said Kim Hyun-tae, an analyst at Shinhan Securities.

Concern about the industry outlook has intensified after Morgan Stanley forecast a looming memory downturn, citing falling demand for conventional Dram memory and possible HBM oversupply.

“Memory conditions are beginning to deteriorate,” said analysts Shawn Kim and Duan Liu in a recent report. “It will get tougher for revenue growth and margins from here as we move past late-cycle conditions.”

Macquarie analysts also warned of a potential supply glut in Dram amid slowing mobile and PC demand, predicting that Samsung might lose its market leadership.

Samsung shares fell last week to their lowest level in the past 18 months as the company has struggled to catch up with SK Hynix and Micron in supplying the most advanced HBM chips, a crucial component of AI systems.

SK Hynix, the main supplier of HBM chips to Nvidia, said last month that it began mass production of 12-layer HBM3E chips, its most advanced version, widening its technology gap with Samsung in the fast-growing, high-margin segment. Samsung’s HBM3E chips are reportedly yet to pass industry leader Nvidia’s qualification tests.

“A delayed foray into Nvidia with HBM3E is costing a big market opportunity,” said Daniel Kim and Jayden Son, analysts at Macquarie, in a recent report. “Ramping up production yield is another challenge, even after product qualification.”

Samsung is also struggling to narrow the gap with Taiwan Semiconductor Manufacturing in contract chipmaking, where it is expected to suffer billions of dollars in losses this year. The Macquarie analysts warned of a possibility that Samsung’s $17bn foundry in the city of Taylor, Texas, could be a “big stranded asset” due to a lack of major clients.

Samsung has said the Taylor fab would begin production in 2026 for leading-edge chips at 4nm and below to meet growing customer demand for advanced nodes amid the AI boom.

Stiffer competition in the high-end smartphone market is another concern. Huawei launched a $2,800 tri-fold phone last month to take on Samsung, while Apple unveiled the new iPhone 16 last month, promising a steady rollout of new generative AI features.

The weak guidance comes as Samsung is cutting some of its 147,000 overseas staff and wrestling with growing worker discontent at home. The company said its overseas subsidiaries were “conducting routine workforce adjustments to improve operational efficiency”.

“Our primary focus will be on enhancing our fundamental technological competitiveness,” Jun wrote as he acknowledged the “testing times” facing the company. “We will review our organisational culture and processes, and take immediate action to rectify any aspects that require improvement.”

AFTER we add seaweed, pink peppercorns and manuka wood, my partner Steve and I decide 15 ingredients is probably enough and it’s time to get bubbling.

It might sound like we’re in a Hogwarts potions class – but we are, in fact, students at Piston Distillery’s Gin School.

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And we’re impressed with the resulting concoction, which we proudly name Curious Gin-cident – although this might be down to the four G&Ts we sampled earlier. Gin school costs £150 for two (Pistondistillery.com) 

(Nep)tune in

A taxi whisks us back to our base for the weekend – Neptune Apartments, a Grade-II -listed Georgian building on Cheltenham’s prestigious Promenade.

Each apartment is named after a Cotswold town or village, and ours, The Painswick, is a beautifully decorated one-bed with high ceilings, intricate cornices and very cool lighting, plus a fully equipped kitchen, breakfast bar, comfy sofa and two huge TVs.

We’d like to move in and never leave, but we’re lured outside by the promise of award-winning burgers.

You might have seen The Beefy Boys on TV with Tom Kerridge last year, as they built up to opening their third restaurant here in Cheltenham.

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The juicy PBJ Boy, £12.80, comes with two smashed patties (but you can add more if you like), cheese, bacon, bacon jam and chipotle peanut butter, and is totally moreish – as are the poutine fries, £9.50 (Thebeefyboys.com).

Picking up steam

The next morning, we stop off at The Find for a Full Monty breakfast bap, filled with local ingredients, £10.50 (Thefind.co.uk), then head to Sudeley Castle, 20 minutes’ drive away, to walk it off.

Henry VIII’s sixth (and last) wife Catherine Parr lies entombed in the chapel.

Plus, there are beautiful formal gardens, and quirky life-size animal sculptures to spot in the pop-up Animal Ark exhibition. Entry costs £22 per person (Sudeleycastle.co.uk).

At Cheltenham Race Course station, we jump on a steam train (part of the Gloucestershire Warwickshire Steam Railway) and choo-choo our way to Broadway, a chocolate-box-pretty village.

Here, Cotswold Trading has perfect gifts of locally made body lotion and pampas coasters (Cotswoldtrading.com), before we scoff Tisanes Tearooms’ scones with jam and cream, £3.60 (Tisanes-tearooms.com). Day rover tickets on the steam railway cost £26 per person (Gwsr.com).

Later, we venture to Mr Cambray’s Curiosity – a cafe/bar full of nooks and crannies – (Mrcambrays.co.uk), before sharing plates at Japanese restaurant Kibou, where highlights include chicken thighs with sriracha-mayo dip, £10.90, and an amazing soy honey tuna tartare poke bowl, £15.90 (Kibou.co.uk). 

Once home, we nibble on Cotswold brie from Cheltenham’s The Cheese Works (Thecheeseworks.co.uk), relax with a Curious Gin-cident and tonic, and toast a great weekend.