Nearly half (47%) of employees believe their employer should play a role in helping them to prepare for retirement, according to research by Barclays Corporate and Employer Solutions (C&ES).
Its Steps towards a living pension report, which surveyed 2,000 employees who are paying into a defined contribution (DC) pension scheme, found that 93% of respondents believe financial planning for retirement is primarily their own responsibility, while 66% think this responsibility should be shared with the government.
Some 82% of respondents would welcome retirement guidance and support from their employer.
The research also found that the annual income required for a relatively modest but comfortable lifestyle in retirement is £17,500, which Barclays C&ES has termed the Living Pension.
This figure differs slightly across generations, ranging from £18,200 for Generation Y (ages 19 to 33), £17,200 for Generation X (ages 34 to 53) and £7,300 for Baby Boomers (ages 54 to 69).
The research also found:
- 70% of respondents would welcome personalised emails about pension saving that emphasise what they stand to lose by not contributing to a scheme.
- 67% of respondents want to authorise their employer to increase their savings at the time of their next pay rise.
- 78% of respondents expect to work until later in life than their parents.
- 54% of respondents expect to watch what they spend more closely in retirement.
Jonathan Parker (pictured), head of investment proposition at Barclays Corporate and Employer Solutions, said: “This report shows that, while people believe that it is their responsibility to make sure they have enough money to live on in their retirement, they can be anxious about making decisions around pensions and may not feel equipped to make a plan alone.
“There is a clear role here for the employer to offer this much sought-after support and guidance.
“However, we understand that this can equally be a tough task for employers and have developed a toolkit to aid them in this undertaking.
“Our toolkit shows that a simple way of supporting employees is by identifying their individual needs and establishing a Living Pension benchmark for them to work towards.
“Further to this, an employer can use some small defaults to its pension schemes so that it has good value charges and has periodic individual pension wellbeing check reminders.
“The research found that people’s expectations for their retirement are relatively modest and the report suggests that a gradual increase of the auto-enrolment minimum contribution rates from 8% to 12% over time, coupled with greater education and guidance in the workplace could steer DC members towards better outcomes.”