Pension performance disappoints one in five employees

Pension performance disappoints one in five employees

More than one in five people in company pension schemes, the equivalent of 2.3m workers, are disappointed with the performance of their retirement savings, according to research from employee benefits consultancy Portus.

The study showed 21 per cent of employees are concerned about how their company pension scheme has performed over the past two years, with worries about how well their funds are doing deterring workers from retirement saving.

 Around one in 20 employees have not joined schemes due to worries about how their money is invested, according to the research which was from a sample of 1,043 UK employees by Consumer Intelligence in August.

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Data from the government shows membership of workplace pension schemes is at a record high with more than 33.5m now signed up including 11.1m active members.

Portus, which offers the employer-paid RetirePort guidance service for employees through their workplace, believes employees would benefit from increased support and guidance on their retirement savings options to support further expansion of workplace pension schemes.

A total of 26 per cent of employees receive guidance or advice on retirement planning at work, while 11 per cent of employees have regular one-to-one meetings with advisers and 15 per cent have access to online support through their employer.

A total of 27 per cent of workers have said they would welcome guidance from their employer on retirement planning while a third - 33 per cent - say they would be willing to source and pay for independent financial advice.

Portus Consulting commercial director Steve Watson said: “Action to tackle the UK’s problem with retirement saving including workplace auto-enrolment is definitely working with pension scheme membership at an all-time high.

“But the missing link is that employees are being left to their own devices and significant numbers are disappointed with pension savings while others are being deterred from even starting to save.

“Employers can play a role in helping to provide guidance on long-term retirement planning but clearly need support in delivering it as the costs can deter employees as well as employers.”