Research by WEALTH at work found that 83% of employees are concerned that the cost of-living crisis will mean they will have to work longer before retiring and 33% think they won’t ever be able to afford to retire at all.
Making regular contributions into a pension pot is also becoming more of a challenge, with salaries struggling to keep pace with rising costs. WEALTH at work’s research showed that 13% of employees have reduced or stopped their pensions because of rising costs. Yet 29% say they may consider stopping payments in the future, while 30% may consider reducing future payments.
As part of ‘Pensions at Work 100’, the PLSA and ITN Business have today released a news-style programme to reflect on the advances made by the pensions industry to support good retirement outcomes over the last century and to showcase its ideas on how to address today’s challenges and opportunities. Watch the film above which features Kerry Shiels, Pension & Benefits Director, BT Group and Jonathan Watts-Lay, Director, WEALTH at work. You can also see their comments below.
Jonathan Watts-Lay, Director, WEALTH at work comments; “It’s important that people understand how their pension schemes work, what they should be contributing, what funds they should be selecting, but ultimately, what size of pot they need or want when they get to the point of retirement.”
He adds; “Then once at-retirement, people need to understand the options available to them for creating retirement income from pensions they have accumulated, as well as other savings such as ISAs or other investments. Understanding what their state pension will be and when they will receive it is also crucial. For some, decisions that are made at retirement may be the biggest financial decision they make in their lives.”
WEALTH at works research also showed that 56% of employees either spoke to family and friends, or no one at all when getting support with their pension. This highlights the need to ensure employees are guided by reliable sources.
Watts-Lay comments; “I think it’s really important that employers ensure their employees are making the right decisions. It’s all part of what’s increasingly becoming a financial wellbeing strategy in many organisations now.”
Many leading employers, such as BT Group, are now providing quality financial education to their employees to help them build financial resilience as they move towards retirement.
BT Group puts its employees through a retirement programme to help them understand their options which includes financial education and guidance.
Kerry Shiels, Pension & Benefits Director, BT Group, comments; “We’ve worked with WEALTH at work for a number of years. They’re very familiar with our retirement arrangements and they are valued by our colleagues to help educate them. So, they run a lot of retirement education programmes.”
Shiels comments; “The nature of how you save for retirement is changing. I think the need for financial education is actually wider than just retirement savings so that people can look right across their whole financial position, which is increasingly important. The important thing WEALTH at work offers our colleagues is an independent programme of retirement guidance and financial wellbeing education which enables them to move through to retirement in a much better-informed way.”
The knowledge gained from the financial education seminars at BT helped a retired employee, Rob Booth, to retire and realise his dream of restoring an old building. He comments; “WEALTH at work came to BT and I attended their seminars, the curtains went back on what was possible and how you could actually use your retirement and your actual pension, it was quite an eye-opener. I couldn’t possibly have done it without the help that WEALTH at work gave me to actually invest in such a good way that I did.”