As we head towards the first autumn Budget on 23 November, speculation is rife about Chancellor Philip Hammond’s possible changes to pensions. This is hardly surprising given the vast pace of change experienced in the pensions industry over the past few years. In many cases, employers have found it necessary to digest the latest changes, and review and adapt their workplace pension arrangements accordingly, often at very short notice. In these cases, ensuring employee are fully aware of, and understand, the impact of the changes is a key task on employers’ agendas.
Following the introduction of the pension freedoms in 2015, which give employees greater freedom in how they take their pension pot at retirement, many employers have seen an increased need for guidance around pension decisions at retirement among their workforce.
Two-fifths (40%) of respondents to this year’s Employee Benefits/Nest Pensions research say that uncertainty about how to make the best decisions when accessing pension benefits is now an area of concern for their workforce. Coupled with the fact that 43% believe that concerns about a lack of money in retirement exist within their workforce, while 41% say that staff are concerned about their financial security in retirement, and the need for education and guidance becomes clear. Making the correct decision at this stage is crucial if pension scheme members are to achieve the retirement they desire.
Looking to the future, the provision of guidance and education around workplace pensions could become even more important. Among respondents that believe the UK’s exit from the European Union will impact pensions, more than a third (34%) say that it will increase employee engagement in retirement planning, while just over a quarter believe it will prompt staff to increase their pension contributions.
As this, and other changes in the pensions arena play out, supporting staff at all stages of their financial journey will become even more vital.
Debbie Lovewell-TuckEditorTweet: @DebbieLovewell
