Pensions provider Axa has launched a service which will automatically increase members’ pension contributions by an agreed percentage at set time periods.
This is aimed to address issues of employee participation and engagement in pension schemes.
The service, Save More Tomorrow, which has been added to its group stakeholder and group personal pension products, will mean that employees will agree at the outset how much they would like to increase their contributions by and when. These will then be automatically increased without any further action or decision making.
Mark Rowlands, head of corporate partnerships at Axa Corporate Benefits, said: “We have carried out extensive research around behavioural finance and were not surprised to find a lack of action and high levels of inertia when it came to planning and investing into a pension.
“By automatically increasing contributions, we are helping people to increase their pension pot to deliver a better income in retirement. The real beauty of this enhancement is that the increases can be arranged to coincide with key dates, like pay rises, so that employees don’t feel the pinch of a decrease in income.”