I HAVE been out and about discussing money a lot over the past few weeks, promoting my new book on women’s attitudes to cash, and time and again the conversation has returned to how everyone believes their property is their pension.

“You say everyone must have a pension,” one radio host told me during a commercial break, “but it isn’t really true, is it?” Her case was simple: if you buy into a pension scheme of any kind you’ll be ripped off. So the best – indeed, to her mind, the only – answer to living comfortably in your seventies, eighties and nineties is to buy the biggest house you can and rely on the property bubble to finance your retirement.

I have a great deal of sympathy with this way of thinking. For starters, in the days before stakeholder pensions (which are regulated to prevent annual charges rising above 1.5% in the first 10 years and 1% thereafter) it was the case that if you bought into a pension scheme you were usually ripped off.

Charges would have included an annual management fee of 1%-2%; the bid-offer spread on any units in the funds you bought (the difference between the price of units bought and sold, generally 5% or so); a “policy fee” of about £1.50 a month; a switching fee if you wanted to change the fund mix; an annual fee of 3% or so on “initial units” (special units bought in the first few years then held until maturity); and a transfer fee if you wanted to move to another provider.

All this is shockingly complicated, but worse, according to adviser Craig Davidson, it “often resulted in significant loss to the fund value”. And that’s before you even start taking into account the general incompetence of the average pension fund manager and his ability to pick only the worst of funds.

Compare this dismal state of affairs with the extraordinary gains people have made on the property market over the past decade, and the fact that it is much easier to be engaged by owning a Cotswold cottage than lots of units in a UK income fund, and you can see why we all want houses instead of pension funds.

A survey by Accenture in 2005 showed 30% of people intended to use equity from their homes as one of the main ways to finance their retirement. Given the performance of the residential property market since then, I imagine that number has now risen substantially.

However, I’m not convinced. First, there is no guarantee your house will be worth enough when you retire. The past decade has been kind to home-owners, but there have been long periods in history when house prices have either stayed flat or even fallen.

I’ve thought the property market has been set for a crash for some time and so far I’ve been wrong, but I still think it is unrealistic to rely on a rising or even a stable market for much longer.

And even if there is no crash, even if prices keep rising for ever, you are still going to need somewhere to live when you retire. So if you are relying on your house for income, you will have to have to sell up and move on. This isn’t cheap.

You’ll be paying 2% to your estate agent and up to 4% in stamp duty. Then there’ll be moving expenses and so on. All this eats into nest eggs fast. You may also find that you don’t want to trade down – you may need the space for grandchildren or find you don’t want to leave a garden you have nurtured for 20 years to someone else.

I’ve never really understood why people want a lovely big house when they are out all day working, but then when it is time to retire – and stay at home all day – they think they can make do with a home that’s not quite so nice. Surely it should be the other way round?

And as for getting into the buy-to-let game, either at home or abroad, to finance your pension, it might work but then again it might not.

With prices at record highs and yields at record lows, few new investors are making any money on a monthly basis. They are therefore entirely dependent on making capital gains if their investment is ever to make financial sense.

Maybe they will make those gains, but right now all logic suggests they will not. The property market will not behave in the same way over the next decade as it has over the past 10 years.

However, there is good news too. The pension market has changed – it is no longer the frightening place it must have been when my radio host was last involved in it. There is no need to have an old-fashioned pension or to pay the kind of charges I listed above.

Instead you can get a self-invested personal pension (Sipp) and arrange everything yourself. Sipps are in effect just tax wrappers – you buy the wrapper from a provider and then you just pop into it the funds or shares you want to own. Buy the wrapper from the likes of Hargreaves Lansdown or Killik & Co and you can run your fund for very little: they charge you only basic trading fees for shares and heavily discounted initial and annual fees on funds.

A Sipp is cheap, it gives you access to every asset class you can think of (you can even buy property funds if you really must) and it has got to be both easier and less risky than running a group of buy-to-let flats filled with fussy tenants.

Merryn Somerset Webb’s new book, Love is not Enough: A Smart Woman’s Guide to Making (and Keeping) Money, is now out from Harper Collins

Merryn Somerset Webb is a former stockbroker and now editor of Money Week. Her views are personal and investors should always seek professional advice

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