Almost half of employees don't know how to plan their retirement

Nearly half (47 per cent) of people in work do not know how to plan for their retirement, according to Aviva, leading the company to call on employers to do more to help their employees.

The research found that less than one in three people (28 per cent) felt secure in their knowledge of how to manage their pension as they get closer to retiring, while 27 per cent were confident they knew what a ‘good’ amount is to have in their pension for someone their age.

Women were almost twice as likely as men to feel completely ‘on the back foot’ about preparing and saving for retirement, with 21 per cent citing concern compared to 12 per cent of men, while 34 per cent of women felt in the dark about how to manage their pension as they neared retirement, compared to 14 per cent of men.

Over two-fifths (41 per cent) of respondents said they were worried about being able to retire when they wanted to, significantly higher than the 31 per cent who were concerned about how much they currently get paid.

Aviva urged employers to help workers with their transition into retirement, noting that nearly three in five (59 per cent) employees would be open to receiving pension planning support at work to help them identify how much they need to pay into their pension to live well once they retire.

Additionally, almost a quarter (23 per cent) of adults would like to be offered support on how to manage their pension as they approach retirement, while one in five (20 per cent) said they would like more support on what type of pensions there are.

More than half (51 per cent) also believed they will need support from their employer to create an easier transition into retirement, such as flexible or part-time working.

Aviva head of workplace savings and retirement, Laura Stewart-Smith, commented: “Our findings show there is a major vacuum in retirement preparedness which businesses can help to fill. We’ve seen the lines between home and work become blurred beyond recognition for many people during the pandemic.

“As we look ahead to the future, employers will play a key role in helping people to manage their workplace pension to their best advantage. We are calling for a Living Pension accreditation to help give people confidence that they work for an employer who will help provide for their future wellbeing, as well as their immediate needs.

“When it comes to saving, you need to understand where you’re starting from, where you want to get to and the actions you need to take to get there. A more personal approach to financial education at work can give more people the opportunity and support they need to take positive steps to improve their financial wellbeing.”

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