More than a quarter of savers never review the state of their retirement savings, according to a survey by Aviva.
The figure for women was even higher, with 32 per cent neglecting their retirement savings completely.
The survey of close to 1,000 people also found that a fifth of those with a pension only checked its progress once every five years.
“The lack of engagement with pensions is frightening,” Clive Bolton, Aviva UK Life’s managing director of retirement solutions, said.
“Ask most people what they earn now and they’ll have a pretty good idea, sometimes down to the penny, but most people have no idea what their pension is worth. A pension is your salary when you’re no longer working. Surely it deserves more than a glance at a statement once a year.”
A pension is your salary when you’re no longer working. Surely it deserves more than a glance at a statement once a year. Clive BoltonAuto-enrolment specialist schemes told a similar story.
Now: Pensions reported there has been hardly any engagement with its website, with the majority of interest coming from members who wanted to opt-out.
“It’s a sad fact that the second most popular search term on our website is ‘opt-out’,” the scheme’s director of communications Amy Mankelow told FTAdviser.
“Although our overall opt-out rates remain fairly low at around 9 per cent, it’s clear that the main reason members pay a visit to our website is to find out how to leave.”
She said member engagement was an “uphill battle”.
“Only 1 per cent of our members have accessed their member account online and when we issued annual benefit statements we receive a number of calls from people who were completely unaware that they’d been enrolled despite having received all the statutory communications.”
While Ms Mankelow said she hoped engagement would improve as balances grow, others in the industry expect the opposite to happen.
Salvus Mastertrust managing director Graham Peacock told FTAdviser he expects opt-outs to increase in line with the contribution rate.
“Right now, the engagement that I have got is, how do I opt-out? We’re not seeing any mass opt-out because we’re only on 1 per cent. But at 5 per cent we’ll see opt-out rates much closer to 30 per cent. That’s negative engagement,” he said
Peter Walker, chief operating officer of Smart Pensions, was more optimistic.
He said responses to member statements and other member engagement had met with “very little” response, but added: “It’s going to take time. At the moment nobody’s auto-enrolment pot is very large, so it doesn’t figure very large in their thinking. But over the years it will grow, and so I would look for more engagement over time.”
Nest chief investment officer Mark Fawcett was also optimistic.
He said he was “pretty unconvinced” that more people would opt out when contributions rise.
“People know they have to save for a pension. And we’ve got some quotes around the walls [of the Nest office] of member research we’ve done that says, ‘Thank goodness I’m finally doing something about it,’ and, ‘I could never get myself organised to invest in a pension, and now it’s being done for me, and it’s another thing to stop worrying about.’
“Yes, opt-outs may increase a little bit [when contribution rates rise], but I’d be amazed if it was a major increase,” he said.
james.fernyhough@ft.com
