Around 83 per cent of pension holders do not know what pension contributions they should be making to generate the retirement income they want to live on later in life, according to industry research.

The survey from NerdWallet found that more than three-quarters (78 per cent) of savers said their pension provider had not given them enough information to effectively manage their pension, while 64 per cent were unsure who their pension provider is.

In addition to this, less than a third (30 per cent) of pension holders thought their employer had clearly communicated how their workplace pension works.

Three-quarters (75 per cent) of savers said that they lack the confidence to manage their own pension without professional help or advice, with 25 per cent highlighting the terminology and language used by pension providers as a particular barrier to this.

Despite these concerns, 80 per cent of respondents said they had not sought advice on their pension from an independent financial adviser, while 89 per cent said said that they are less likely to seek out professional advice for their pension than they would for other products like a mortgage or car finance.

There were positive signs, however, as 25 per cent said that the pandemic has made them think more carefully about retirement, while nearly a third (32 per cent) suggested that an online banking-style dashboard would make pension planning feel more accessible to them.

Commenting on the findings, NerdWallet senior pensions expert, Richard Eagling, said: “One’s pension can be complex, confusing, and even daunting at times, but the sooner you are able to look into what’s in it, the closer you will be to clarity and peace of mind.

“It is true that managing a pension on your own can be confusing if you aren’t familiar with a lot of the terminology and language, which is why it can be a good idea to consult a professional who can give you advice on things such as determining how much retirement income you would need, and work from there to figure out what contributions you need to make.”

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