Savers ‘remain unaware’ of AE advantages – TPP

Many workers across the UK were unaware of the advantages of saving into an automatic enrolment (AE) pension scheme, new research from The People's Pension (TPP) has revealed.

TPP’s survey found that 35 per cent of savers automatically enrolled in pension schemes were unaware that the government contributes tax relief to their pensions.

Furthermore, more than half (55 per cent) of workers saving into a pension did not know how much the government pays in tax relief towards their pension pot.

It also discovered that 48 per cent were oblivious as to how much their employer was paying into their scheme, and one in 10 did not know that their employer contributes into their workplace pension at all.

Despite this, 90 per cent of respondents said that they could see the benefits of an AE pension, even if they were unaware of the specifics, and 79 per cent believed that it was now easier to save for retirement.

Commenting on the study, TPP director of policy, Gregg McClymont said: “Auto-enrolment is a real success story with 10 million more people now saving into a pension. It’s encouraging that the vast majority of people see the positives of saving into an auto-enrolment pension, but as we head towards April’s increases, there’s work to do to ensure savers are getting the full picture.

“This year’s contribution increases should see people saving thousands more, allowing them to live more comfortably in retirement.

“There is always a risk that people may choose to stop contributing if they aren’t aware of the advantages that saving into an auto-enrolment pension brings. At a time when millions of people in the UK will be under-pensioned if they rely just on the state pension, getting this message across is crucial.”

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