Are you saving to retire?
58% of employers expect to help their employees make more informed choices about their finances in preparation for leaving the workplace, according to new research. But interestingly, almost half admitted that they only contributed the statutory minimum of 1% to pension pots.
More than 35% of respondents said they felt it was the government’s responsibility to provide the necessary financial education to employees, and just under half were concerned that workers were not making adequate provision for their retirement.
Employers are becoming more aware that they could end up with a sizeable number of older staff who simply cannot afford to retire. It has been suggested that the pensions’ industry and the government should consider whether pensions are the only way to retire, and whether today’s young workers would prefer a savings product that’s more flexible.
Approximately two million older workers in the UK may not be able to afford to retire because somebody else is financially dependent on them. The main reasons given by over-50s for remaining in work were the financial needs of their children or parents. However, 40% said they were motivated to stay in work because of job satisfaction and fulfillment. This figure rose to 53% among 65 to 69-year-olds and two thirds) of over-70s.
Four in 10 workers believe they will never be able to retire, further reflecting the importance of saving for retirement through a workplace savings scheme.