As one millennial respondent put it: "Pensions are risky. You put so much in, but there are no guarantees you’re going to get it back. If the pension company goes bust, the money’s gone."
This has all served to reinforce the perception that cash and property are both "safer than a pension", which has, in turn, evolved into a one-way bet on the property market.
In its report, the PLSA called on the government and employers to establish retirement income targets to improve savers’ understanding of how to achieve their desired standard of living in retirement.
But is this addressing the root of the problem? Many respondents told The Wisdom Council they feel that it is their pension providers who should do more to help them understand their retirement options.
There are 10.6 million people in the UK aged between 50 and the state pension age (SPA) who will be entering retirement between now and 2030.
A combination of the demise of Defined Benefit (DB) pensions in favour of Defined Contribution (DC) schemes, and low levels of saving among the private sector workforce and self-employed, means that millions of people are approaching retirement with pension pots that will not meet their retirement income needs.
Employees in the public sector continue to benefit from near universal availability of DB pensions and active membership of such schemes has been around 85 per cent over the long term. This group represents about 20 per cent of the workforce and 1.7 million of the target age group who will go into retirement with the benefit of a generous pension scheme.
It is a very different story among workers in the private sector. DB schemes have progressively been closed both for new members and future accruals.
There are now only 1.1 million people in the target group that are still active members of a DB scheme. Only 1.2 million were active in a DC scheme prior to the introduction of auto-enrolment, which has boosted this number to 2.2 million in total, albeit for those who have just started saving, it will likely be a case of too little, too late.
The long-term trend over the last 40 years has been for only half the private sector employees to have actively participated in a workplace pension at any given point in time.
The self-employed, who make up around 15 per cent of the UK’s workforce, are a particular concern, with the lowest savings rates of the target age group. The schemes available to them are DC personal pensions and do not benefit from employer contributions.