The government and employers must take steps to turn “inertia into action” for defined contribution (DC) pension savers, Broadstone has said.

The call came in response to the Financial Conduct Authority (FCA) Financial Lives survey, which showed more than a third (37 per cent) of DC savers did not know how much was being contributed to their pension, while two in five (40 per cent) savers did not feel confident their retirement income would be as much as they hoped.

The results of FCA’s Financial Lives survey, published in July, showed that 37 per cent of savers were unaware of how much they and their employers were paying into their pension pots.

What’s more, as many as three-quarters (74 per cent) had not increased the percentage of salary they were contributing to their retirement savings.

This lack of action comes in spite of the fact that 40 per cent of people said they did not feel confident that their pensions would give them the income they hoped for in retirement, while just a third (34 per cent) said they felt confident.

Broadstone said that the figures suggested that while auto-enrolment had led to millions of new savers creating pension pots for the future, this had not translated into people taking the active steps needed to ensure an adequate standard of living when they retire.

Broadstone’s head of DC workplace savings, Damon Hopkins, said: “Despite lacking confidence about achieving their desired income in retirement, the FCA data shows that savers are still unaware how much they are contributing and how much income that will generate, let alone whether they’ll have enough in retirement.”

He added: “It is abundantly clear that the next phase of auto-enrolment needs to see a transition from inertia to action – from the government and employers. Having relied on inertia to get millions more people paying into workplace pension schemes, we need to rely on the same inertia to increase contribution rates if savers are to achieve the standard of living they desire in retirement.”

Share Story: