Just 3% help staff understand the changes to lifetime and annual allowance limits

JMakings 430

Just 3% of employer respondents are helping their employees to understand the changes to lifetime and annual allowance limits that come into effect in April 2016, according to research by Close Brothers Asset Management.

The Close Brothers business barometer, which surveyed 917 employers, also found that 14% of respondents offer retirement seminars to help staff to navigate the pension reforms introduced in April 2015.

The research also found:

  • Around a third (30%) of respondents have introduced broader pension engagement to support employees, compared to 25% in October 2015.
  • 17% offer specific support for staff at retirement.
  • 36% of respondents offer employees access to advice.

Jeanette Makings (pictured), head of financial education services at Close Brothers Asset Management, said: “The pension reforms themselves have heightened the need for financial education as with greater choice comes greater complexity and individuals need to be aware of the impact on their finances and need more guidance to make good decisions.

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“With even more policy changes ahead, such as the reduction in the annual and lifetime allowances, it’s vital that employees are aware of how they could be affected, and importantly how to plan around it.

“Employers are in a unique position to play a central role in helping their employees to understand and make the right choices. Addressing new reforms as they come along can easily be built into existing financial education programmes.”