Companies are being advised to hold a pensions clinic for their staff as HR managers estimate three quarters of staff are confused when it comes to securing their financial future.
A survey, conducted in the final quarter of 2019, showed uncertainty about how to make the best decisions when accessing pension benefits tops the list of concerns affecting the workforce in the run up to, or during, retirement. The uncertainty has risen from 54% in 2018, to 74% now, with the recent General Election and Brexit believed to be adding to staff uncertainty when reviewing their finances.
But further research shows that at least four out of 10 companies don’t communicate thoroughly with their staff over pensions.
Emily Small, a Director of North Staffordshire based experts, Richard Jacobs Pensions and Trustee Services, said all companies should strive to give staff peace of mind when it comes to securing their future into retirement.
“We advise our clients to hold a pension review clinic and we’d like to see that happen across all companies,” said Emily. “Many older workers, who began saving before auto-enrolment was introduced, may not have saved consistently throughout their working life and may not know how healthy their pension pot looks, and there’s understandable uncertainty about money matters due to the complicated political position in recent times.
“We would like to see everyone given the chance to attend a pension clinic to gain a full understanding of where they stand when it comes to how much money they will receive to live on following retirement.”
A study called the Employee Benefits/Wealth at Work Pensions research 2019 showed: 74% were most concerned about how to make the best decisions when accessing pension benefits, 59% didn’t think they had a financial plan, 58% were concerned about running out of money in retirement, 43% were concerned about their lack of awareness of tax implications on their pension funds.
Emily added: “The good news is that if you’ve fully paid up your National Insurance contributions you are guaranteed a state pension of £168.60 a week, but most people will want more than this if they are to enjoy a comfortable retirement. Clearly, everyone is different, but most people will be looking to build up a minimum pension pot of between £250,000 and £500,000. Companies can give their staff peace of mind by offering pension reviews to all. This survey makes clear that uncertainty levels are high, yet many companies don’t communicate the full facts on pensions to their staff.”
Richard Jacobs Pensions and Trustee Services advises many companies in Staffordshire and Cheshire and any company looking to hold a pensions clinic can contact Emily Small via email at firstname.lastname@example.org.