More than three-quarters (79%) of employer respondents are supportive of the government’s pension reforms, according to research by JLT Employee Benefits.
Its research, which surveyed 250 employers and 2,000 UK employees, found that a quarter of employer respondents would amend their pension scheme’s rules to allow flexible retirement, while another quarter would not.
Around two-thirds (69%) of employer respondents believe that, to ensure impartiality is not compromised, providers should outsource the delivery of financial guidance, while 19% believe that individuals should pay for this additional support and advice.
Less than two-thirds (63%) of employer respondents think the cost of additional support and advice should be borne by employers, although 35% said this should be the case under the condition that the cost is subject to tax relief.
Among employee respondents, the research found:
- 55% of respondents underestimated their longevity and 40% said they would, if they took a lump sum on retirement, reinvest it in either a long-term or easy-to-access bank account.
- 16% of respondents did not know what an annuity was.
- 60% of respondents are indifferent to, or actively resist, financial advice.
- 72% of respondents plan to fall back on the state if their savings are inadequate.
Mark Wood (pictured), chief executive of JLT Employee Benefits, said: “There is clear evidence that individuals need more support and guidance around their retirement planning, and education has to play a key part in helping the industry tackle this challenging issue.
“Whether this is provided via the state, the pension provider, the employer or all three, remains to be decided.
“Our research shows there is an inherent reluctance to consult an adviser, which we believe is due to a fragmented British pensions market and the perception that paying for financial advice is only worthwhile if you are a high-net-worth individual.”
