66% are saving adequately for retirement


Two-thirds (66%) of respondents employed by large organisations are now saving adequately for retirement, compared to 53% in 2013, according to research by Scottish Widows.

Its Workplace pensions report, based on responses from 5,191 UK adults, also found that more than half (54%) of those enrolled in a defined contribution (DC) pension scheme said employer contributions are vital for boosting pension savings.

The report also found:

  • 60% of respondents working for large organisations plan to rely on their workplace pension to provide them with a reasonable standard of living in retirement. This falls to 40% of respondents in medium-sized firms and 32% in small organisations.
  • 39% of those in large firms view workplace pensions as a major incentive for remaining with an employer, compared to 20% in medium-sized firms and 10% in small organisations.
  • Auto-enrolment is seen as a good idea by 80% of respondents in large organisations, 72% in medium-sized firms and 65% in small firms.
  • 62%, 58% and 39% of respondents at large, medium and small organisations, respectively, say that employer contributions are the main reason behind their decision to save through a workplace pension scheme.
  • 40% of respondents cite auto-enrolment as the principal reason why they started paying into a pension.
  • 23% of those working for large organisations think that employers should pay for full, independent financial advice. One in four (41%) say employers should provide information on how to budget for retirement, while 15% believe they should offer guidance on managing everyday budgets.
  • 52% of respondents in medium-sized firms are saving adequately for retirement, compared to 46% in 2013 and 37% in 2012.

Lynn Graves (pictured), corporate pensions expert at Scottish Widows, said: “Three years since the introduction of auto-enrolment, employees are really starting to reap the benefits of workplace pension savings.

“As workers begin to understand the positive impact of auto-enrolment, businesses need to ask themselves whether they are providing enough ongoing support to encourage staff to be more engaged with longer-term savings.

“Our research is showing that providing a workplace pension alone is becoming insufficient and employees are increasingly looking to employers to provide additional support and financial education to ensure that their staff are not only aware of the mechanics of auto-enrolment, but also making the most of workplace saving to secure a more comfortable retirement.”