On the go: Three-quarters of savers lack the confidence to manage their own pensions and need professional advice, according to a survey from NerdWallet.
The study, covering 1,612 UK adults with a workplace pension, revealed that 83 per cent of savers do not know what level of contributions they should be making to secure their desired lifestyle in retirement, while 64 per cent admitted they do not know who their pension provider is.
Only 30 per cent of respondents said their employer had clearly communicated workplace pension costs.
Despite this, and a lack of knowledge and confidence in financial planning, 80 per cent of respondents said they had not sought advice on their pension from an independent financial adviser, with 89 per cent saying they would be less likely to do so with their pension than they would with other products such as mortgages and car finance.
However, a quarter of respondents said the financial impact of the Covid-19 pandemic had made them think more carefully about retirement.
The study also found that a quarter of those surveyed felt the language and terminology used when discussing pensions made it more difficult to plan for retirement, while 78 per cent said their pension provider had not provided them with enough information to manage their pension pot.
However, 32 per cent said that an online banking-style dashboard would make things easier.
Richard Eagling, senior pensions expert at NerdWallet, commented: “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.
“I would encourage those who have a workplace pension to get in touch with their employer to discuss how it works, and what their contributions are. If you know your provider and have the relevant information, you can usually check on their website and see the value of your fund and the plan they have chosen for you.”
He continued: “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.”
