Two in five (43%) UK workers do not know how much they are contributing to their workplace pension, according to Scottish Widow’s Retirement Report.
In addition, just over half (54%) do not know how much their employer contributes.
Scottish Widow’s report also found that more than a third (36%) of workers admit they do not feel confident in their ability to manage their retirement savings.
Despite this, take-up of financial advice remains low, with just 20% seeking help from an adviser for guidance on managing their finances, while fewer than one in 10 (8%) have approached their employer for support.
The research echoes the latest findings from the Pensions Policy Institute, which revealed that 70% of defined contribution savers fully withdraw their savings without any sort of financial advice.
Pete Glancy, head of pensions policy at Scottish Widows, said: “With so many workers in the dark on their workplace pensions, it’s little surprise that confidence is low. There is a clear need for better support for workers, from the start of their savings journey, engagement during their working career right through to the point at which they access their retirement pot.
“Since the introduction of Pension Freedoms in 2015, more people have taken advantage of the option to withdraw their pension as cash. Whilst this flexibility can be beneficial, rushing into withdrawals risks depleting retirement savings too soon, if not done cautiously.”
Glancy added: “For those who have the means, seeking financial advice is invaluable, offering structure, reassurance, and a plan tailored to peoples’ needs. At the same time, the onus is also squarely with providers who must do more to engage savers early, and make pension information more accessible, ensuring future generations are better equipped to make informed decisions.”
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