This year’s Pensions Awareness Day took place on 15 September, with an aim of highlighting the importance of saving for retirement.
Research carried out by HR and payroll services provider MHR, to tie in with the day, however, found that as many as one in four employees have no pension at all despite automatic enrolment being a legal requirement. In addition, 58% of respondents admitted they find it hard to understand how their schemes operate and how to contribute to a pension plan.
Worryingly, according to the study, 58% of workers are choosing to risk their financial security because of this lack of pension scheme understanding, prompting MHR’s CFO, Mark Jenkins, to believe the statistics “show the stark reality of how unprepared today’s workforces are for their future”.
Other pensions-related research out this week revealed a big gender divide in terms of attitudes to saving, with two-thirds of men feeling confident they will retire at the age they intend to, compared to around half of women.
The survey by Canada Life also discovered that, among those who had received professional financial advice, fewer women than men did not feel they would have any financial worries in retirement, at 45% and 58% respectively. This suggests that targeted pensions communications maybe needed to address this gender imbalance.
In terms of personal finance education, data from Nudge Global showed that only 32% of employees receive it as a workplace benefit. The figures further revealed that high earners are 51% more likely to receive it than those on lower salaries.
Such findings lead me to believe that, although auto-enrolment has been great in terms of ensuring more people are saving for retirement, it hasn’t necessarily increased engagement with, or understanding of, pensions among employees. Studies are constantly reaching the same conclusion, highlighting that raising pensions awareness is still most definitely a work in progress.