+353-1-416-8900REST OF WORLD
+44-20-3973-8888REST OF WORLD
1-917-300-0470EAST COAST U.S
1-800-526-8630U.S. (TOLL FREE)

PRINTER FRIENDLY

Workplace Pensions Consumer Research Report 2020

  • ID: 5022535
  • Report
  • May 2020
  • Region: Global
  • 47 Pages
  • IRN Research
1 of 3

Enquire about COVID-19 updates for this product.

Enquire Now

55% of all consumers have a workplace pension

Over half of all consumers have a workplace pension and among consumers with workplace pensions, most (51%) have a defined contribution (DC) pension with just over four-in-ten owning a final/career average pension. 85% of adults with a workplace pension have a pension with their current employer, with 15% having legacy pensions from previous employers.

This report is a consumer research report looking at how individuals are using workplace pensions to save for their retirement. For this report, the author commissioned research from MIS Group’s UK panel. The research was structured so that 2,077 nationally representative consumers aged 18+ were asked about their pension ownership and savings. This generated 1,142 individuals who had a workplace pension and 975 individuals who had a workplace pension with their current employer.

Workplace pension ownership shows clear gender, age, social grade and income variations:

  • More mature female workers – more likely to have Occupational DC pensions
  • Older affluent males – more likely to have occupational DB pensions
  • Younger affluent males – more likely to have GPP pensions.
  • Older individuals are more likely to have occupational pensions compared with younger adults.

In some respects, occupational DC pensions are the female alternative to the male-dominated occupational DB pension, while GPP pensions are the young, male alternative to the mature, male-dominated occupational DB pension.

Almost six-in-ten workplace pension scheme members were automatically enrolled into their company’s scheme, i.e. they were told they were joining the scheme but not asked their permission, with four-in-ten workplace scheme members making a pro-active choice to join their company’s workplace pension. Those auto-enrolling tend to be younger and less affluent workplace pension holders. Auto enrolled scheme members appear to have lower engagement with and a weaker sense of personal ownership of their pensions compared with pro-active joiners, with the result that they seem to have less knowledge of their pensions compared with pro-active joiners and are more likely to join a scheme without getting professional pensions advice.

Pension understanding and the delivery of pension advice and guidance can be improved in two ways:

  • Mature, older workplace pension holders. A pension dashboard and/or a website offering pension advice appeals strongly to this group.
  • Younger workplace pension holder and new joiners. A fully automated online advice service appeals strongly to this group, to be used as a substitute for contacting a human advisor or as a complement to human advisory service.

The dashboard and the non-automated online advice service are more applicable for those nearing retirement, while an automated service is more applicable for those taking out a pension for the first time.

Note: Product cover images may vary from those shown
2 of 3

Executive Summary

  • Most workplace pension holders have DC pensions
  • And over eight-in-ten have a pension with their current employer
  • Most workplace pension holders make contributions
  • Most workplace pension holders were automatically enrolled
  • And around half join their company schemes without getting professional advice
  • Many pension holders lack understanding and knowledge
  • Which may explain the uncertainty about retirement income
  • Lack of knowledge can lead pension holders to make mistakes
  • Improving pension understanding and the delivery of advice
  • With online delivery an important element

Introduction

Workplace Pension Ownership

  • Over half of consumers own a workplace pension
  • Occupational workplace schemes the most popular forms of pension
  • Final salary/career average pensions, something for the mature affluent male
  • Seven-in-ten workplace pension holders make personal contributions

Joining a Workplace Scheme: An Informed Choice?

  • An active or passive decision?
  • Auto-enrolment reduces active choosing for the young
  • Is it a decision based on advice?
  • Auto-enrolment reduces informed choosing

Pension Understanding

  • Pension knowledge is generally poor
  • Less than one-in-four pension holders have good knowledge
  • Auto-enrolment results in diminished knowledge
  • Which may explain why many are uncertain about their retirement income
  • Lack of knowledge can lead pension holders to make mistakes

Ways to Improve Knowledge and Decision Making

  • Is it advice or guidance which is in demand?
  • GPP pension holders the most willing to pay for advice or guidance
  • Can online delivery improve the distribution of advice or guidance?
  • Pension holders “In the Light” often have a greater appreciation of online tools
  • Over half of workplace pension holders open to a commercial automated service


List of Figures

Figure 1 The breakdown of workplace pension ownership
Figure 2 The types of workplace pensions owned
Figure 3 The demographic profile of the main types of workplace pensions owned
Figure 4 The types of contributions made to workplace pensions
Figure 5 How individuals joined their workplace pensions
Figure 6 How individuals joined their workplace pensions by age, social grade and gender
Figure 7 Sources of advice used before taking out or enrolling in a pension
Figure 8 Sources of advice used before taking out or enrolling in a pension by method of joining
Figure 9 The features of their pensions that pension holders know well
Figure 10 The three knowledge groups by understanding of their workplace pension
Figure 11 The three knowledge groups by pensions owned, method of joining and age
Figure 12 Confidence about retirement income by pension knowledge and pension type
Figure 13 Indicators of potential mistakes workplace pension holders can make
Figure 14 The attitudes to advice and guidance and the willingness to pay
Figure 15 The attitudes to advice and guidance and the willingness to pay by pension owned.
Figure 16 Pension holder support for online pension selection and management tools
Figure 17 Pension holder openness to new online tools
Figure 18 The willingness to use a commercial automated online advice/guidance service

Note: Product cover images may vary from those shown
3 of 3

Loading
LOADING...

Adroll
adroll