PLSA report backs some key findings from ii's Great British Retirement Survey
12th October 2022 15:35
by Rebecca O'Connor from interactive investor
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The largest UK-wide survey of its kind backs up the PLSA’s findings and emphasises the need for better education on how pensions work.
Commenting on the latest PLSA report, Becky O’Connor, Head of Pensions and Savings, interactive investor, said: “Now that more people have pensions thanks to auto-enrolment, we need to make sure those pensions will do what they say on the tin and provide people with adequate retirement income.
“Merely having a pension through work is not enough. When it comes to hitting target incomes, most people are way wide of the bullseye, as the PLSA report illustrates. Unfortunately, many people think that just having a pension is enough to mean they don’t have to think any further about it.
“To prevent future generations retiring with inadequate incomes, it is important that people are better educated about how pensions work, how much you need to put in and what else the outcome depends on, such as investment growth.
“There is a delicate balancing act to be struck. Telling people their pension isn’t going to be enough at a time when budgets are stretched and faith in the pensions system is strained, could just make people feel even more hopeless. It is important to understand that a better retirement outcome is achievable without too much sacrifice in the short term.
“But it is possible to make a big difference to your own retirement outcome and the sooner pension investors make positive choices with their fund, such as increasing contributions or switching to a higher growth option for younger workers, the better.
“We just published our 2022 Great British Retirement Survey – the largest UK-wide survey of its kind, which backs up the PLSA’s findings and emphasises the need for better education on how pensions work.
“Our survey demonstrated that many savers’ retirement pots are being compromised by simply ‘not knowing’ enough about them. Nearly one in four people in our general population sample told us they do not know anything about pensions. This rose to 29% of women (as opposed to 18% of men) and nearly one in three (32%) of people with household income of less than £30,000.”
Read the full ii report, and ii’s policy recommendations, here.
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