With just three weeks to the start of auto-enrolment into work pension schemes, a survey finds that 52% of British workers have no idea about what is going on.
Brits have 'no idea' about vital pension changes
With just three weeks to the start of auto-enrolment into work pension schemes, a survey finds that 52% of British workers have no idea about what is going on.
Auto-enrolment into workplace pension schemes starts in three weeks' time, but the government's solution to the pensions crisis looks like it may have failed to have reached the ears of those it is most likely to benefit.
The idea of auto-enrolment is to make more people save for their retirement so they don't end up impoverished in old age.
Auto-enrolment is being brought in gradually over the next five years, but from October, Britain's largest employers will have to automatically put their workers into pension schemes unless they make a conscious decision to opt out.
Half-hearted
However, research from Scottish Widows found that 52% of workers (9.9 million) are "completely unaware" of what is happening. Awareness was found to be "particularly poor" among lower paid employees, with just a third of those earning less than £20,000 aware of what is happening.
This is the group that auto-enrolment is particularly aimed at as these are the Brits most likely to face an impoverished retirement unless they save into a pension.
Of those who were aware of auto-enrolment, just 16% had been told by their employers, with 61% saying they found out through newspapers and television.
Lynn Graves, head of business development, corporate pensions at Scottish Widows, says: "With just three weeks to go until auto-enrolment comes into force, it is shocking that there remains such a huge gap in awareness, and that the media has had to step in to play a pivotal role in educating people about these changes."
Good idea
However, those who did know about auto-enrolment said they were in favour of it and just 11% said they planned to opt out. Of those planning to opt out, 32% said it would be because they couldn't afford to make contributions.
However, earlier this year it was revealed that at RBS, which started auto-enrolling early, the opt-out rate was nearer to 40%.
But the Scottish Widows survey found that workers would be willing to put £76.95 a month into their pension, more than double the figure when surveyed last year. However, 33% said even putting this much in won't give them a decent retirement income.
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Quick tips
- You can opt out of being auto-enrolled into your work pension - and you can opt back in at any time
- Opting out of a pension means missing out on tax relief as well as contributions from your employer
- Not everyone will be auto-enrolled - you have to be at least 22 and below state pension age and earn more than £8,105 a year
Few people expect to rely on the state for their retirement income