British workers are blissfully unaware of a number of key government initiatives on saving for retirement after wide-ranging report revealed the extent of the country's understanding on workplace pensions.
With two-thirds of eligible UK workers now enrolled into a workplace scheme, according to a report prepared by Scottish Widows 68 per cent of people do not realise that their pension contributions will automatically ratchet up from 2018 and again in 2019.
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The current minimum contribution, for those that have not opted out of auto-enrolment, is two per cent of earnings. But this will increase to five per cent in April 2018 and to eight per cent in April 2019. As the increases are automatic this will effectively reduce employees' monthly take-home cash and the research indicates that less than a third of people are expecting this.
The Pensions Regulator said that in March, 6.6m people had been auto-enrolled and yet today's research of over 5,000 adults indicates that 24 per cent of people are still completely unaware of auto-enrolment.
There was more positive news in the survey, as it found that younger people were starting to get the message and were eager to know more. Those aged between 22 and 29 were twice as likely compared to the national average to save into a workplace pension if they were furnished with more information from their employer.
"The industry and employers alike need to continue encouraging all workers by providing them with ongoing support on the benefits of being more engaged with longer term savings.
"We should also be mindful of using advances in digital technology when it comes to plugging knowledge and engagement gaps, especially when it comes to younger workers. The longer these workers can save, the better their position will be when it comes to securing a financially stable income for later life,” said David Holton, a director of pension propositions at Scottish Widows.