Britons positive on pension auto-enrolment
Britons are viewing government plans for auto-enrolment in workplace pension schemes as positive, according to the Aviva Family Finances Report.
Research for the study reveals that 72% of UK family heads interviewed do not currently contribute to a workplace pension scheme, although nearly three-quarters of this group would be happy to join if their contributions were matched by their employer.
The most popular amount for employee contributions stood at 5%, which on a typical UK salary of £25,879 could amount to a pension pot of £252,438 over a 44-year working life (taking into account matched employer contributions, inflation and investment growth).
The current average annuity pot is less than £30,000 and Aviva suggests that auto-enrolment will therefore be a significant step towards reducing the UK’s pension crisis.
The insurer’s head of pensions, Paul Goodwin, comments: “The UK is facing one of the largest pensions crises in Europe so it is vital that we consider what can be done now to help customers plan their retirements for the future.”
He adds: “Our research suggests that for many funds are available, but are often prioritised elsewhere … a lack of understanding around pensions is also seriously hampering take-up rates.”
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