One-sixth (16%) of employees reduced their pension contribution levels, while 7% stopped their contributions altogether as a result of the Covid-19 (Coronavirus) pandemic, according to research by Employee Benefits.
The Employee Benefits Pensions research 2020, which surveyed 94 pension strategy decision-makers, also found that a further 15% chose to come out of their workplace pension scheme. However, nearly a quarter (22%) sought access to financial advice in order to gain a better understanding of their pension during this time, and 6% increased their contributions.
The pandemic has also affected employees’ retirement plans: 4% have delayed their retirement date due to the impact that Covid-19 has had on the value of their pot, but conversely 4% have taken early retirement. Some employees (3%) had to access cash from their pension pot early.
Many employers (47%) took no action with regards to their pension scheme in response to Covid-19, however, others introduced support for employees in the way of education and advice. A quarter (26%) introduced additional pensions communications and 11% introduced pensions education sessions for all staff. A further 11% introduced support for those employees nearing retirement. Some respondents (4%) funded access to financial advice for all employees, and 4% funded it for those specifically near their retirement date.
How Covid-19 has impacted employees’ behaviour around pensions
The action respondents’ organisations have taken around pensions in light of the Covid-19 pandemic
Click to download the Employee Benefits Pensions research 2020.