Aviva has raised concerns over the number of adults who are “sleepwallking into retirement”, with almost a third of employees unaware of how many pensions they have.
The latest Working Lives report, released by Aviva today (June 26), paints a concerning picture for Britain’s future retirees, with most workers saying they want better support from their employers on pension planning.
According to the report, almost four in five (79 per cent) employees would like more support from their employer about planning for retirement, while a significant number are worried they will not have enough income in retirement to live comfortably.
Of those who said they would like more support, more than two in five (41 per cent) wanted more information on how to build up a pension pot, and 45 per cent would like more information on how to make a pension last throughout retirement.
It is desperately concerning that many savers are overwhelmed by the choices they face at retirementEmma Douglas, AvivaJust one in five (20 per cent) said their employer provided enough support.
On the employer side, two in five (20 per cent) said they only provided the minimum retirement planning information required.
Tracking down existing pensions was an issue many employees struggled with, according to Aviva.
On average, people have 11 jobs during their working life according to government statistics.
But almost a third of employees (30 per cent) did not know how many pensions they had.
The issue impacts women more, with 34 per cent of women saying they were not aware of how many pensions they had compared to 26 per cent of men.
It was also a prevalent issue among younger workers, with half of 16-24-year-olds saying they did not know how many pensions they had.
On the employer side, almost a third (31 per cent) did not provide employees with any information about tracking down their pensions.
Emma Douglas, Aviva’s director of workplace savings and retirement, said consolidating pensions should be done earlier throughout people’s working lives rather than leaving it to near retirement.
“Consolidating pensions when you start a new job is a great way of making sure you keep track of them, will help to maximise those savings for longer, and contributes to better retirement planning,” she said.
Douglas also said more needed to be done to support workers with retirement planning more generally.
“Pension freedom legislation has given people more flexibility and choice when it comes to choosing how to use their savings at retirement.
“However, it is desperately concerning that many savers are overwhelmed by the choices they face at retirement but are reluctant to pay for independent financial advice and are sleepwalking into retirement.
The pensions industry and government must work together to support today’s retirees in making the right choices for what might be long and, hopefully, financially comfortable retirements,” Douglas said.
jane.matthews@ft.com
