The Money and Pensions Service (MaPS) should introduce “pensions dashboard health checks” to help savers understand their financial positions and make informed decisions about contributions, according to a new report.
The Social Market Foundation (SMF) and M&G this week published research showing that 40% of full-time workers with pensions are unaware of how much their employer contributes to their pension funds.
The survey, which polled 3,000 people, also found that 43% of full-time workers with pensions have never changed their own contribution levels.
Almost three quarters (73%) of respondents said they had checked their pension pot in the past year, but only 9% were saving enough for a comfortable retirement.
“We are facing a retirement and savings crisis, fuelled by low levels of engagement and underpinned by low financial confidence. Collective action is now necessary.”
Anusha Mittal, M&G
Richard Hyde, senior researcher at SMF, said: “Millions of people are still under-saving for retirement, and many barely engage with their pensions at all. Without follow-up support, there’s a real risk people see worrying figures and don’t know what to do next.”
Anusha Mittal, managing director of individual life and savings at M&G, said: “The data and research are clear – we are facing a retirement and savings crisis, fuelled by low levels of engagement and underpinned by low financial confidence. Collective action is now necessary.
“Pension dashboards will have a significant role to play, but they need to be supercharged by regular pension health checks, which provide practical and accessible guidance. The good news is that with the right help, a health check could turn passive awareness into confident future‑proof decisions.”
To help address this, the SMF and M&G have called for the creation of a “pension dashboard health check”, to be overseen by MaPS, which is developing the pensions dashboards system.
This “health check” would turn dashboard data into practical guidance for savers to help them understand their current position, set realistic retirement goals, and make informed saving decisions. The report argues that such a development is vital to addressing the growing problem of retirement under-saving.
The SMF and M&G report proposes that a health check should be integrated directly into the dashboard journey by MoneyHelper, which will deliver the first dashboard to the public.
