Almost a third of UK adults, bury their heads in the sand rather than engaging with pensions planning due to a lack of understanding, according to a YouGov poll. Twice as many (60 per cent) admit to being confused by pensions.

The survey by the Money Advice Service, the independent body set up by the government, showed widespread ignorance, apathy and despondency regarding pensions planning.

It found that four out of 10 UK adults are resigned to working for as long as they can, with 8 per cent of those over 55 who are yet to retire doubting they ever will.

According to the survey, only 45 per cent of UK adults understand the tax benefits of having a pension and a third do not know how much they contribute to their pensions each month. Fifty-five per cent of workers with a pension do not understand how contributions are invested and 28 per cent do not know the name of their pension provider.

Also, more than a third (36 per cent) do not know what an annuity is, and 59 per cent do not understand the relationship between an annuity and a pensions pot. Seventeen per cent of those with a pension who are not retired admitted they have no idea how to work out their projected retirement income.

Money Advice Service retirement and pension expert Jackie Spencer said that while auto enrolment would help, the findings were still concerning: "Retirement is inevitable, so how you plan to fund it is just too important to ignore. It's really concerning that more than one in 10 over 55s who aren't retired have not thought about how they will fund their retirement.”

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