On the go: Nearly 9m mid-career employees are flying blind into retirement, clueless on how much they need to save for their retirement, Aviva research has found.
Its study of 1,036 UK employers and 2,020 employees, which looked into mid-life employees’ financial readiness for later life, showed that 64 per cent of workers aged 45 or more – equivalent to 8.9m people – do not know how much they will need to save to afford a comfortable retirement.
A staggering 5m mid-life employees (37 per cent) do not even know how much is already saved in their pension. Worryingly for reward managers, 36 per cent did not know how much their employer contributes to their pension.
Question marks also hang over the state pension, with two in five (43 per cent) respondents unaware of how much support they will receive from government. A further 26 per cent do not know at what age they will be eligible for the state pension.
With the full, new state pension currently valued at £168.80 per week, this adds up to a retirement income of £8,777.60 a year if eligible for the maximum payout.
Lindsey Rix, managing director of savings and retirement at Aviva, said: “Our findings show many UK employees are approaching retirement with their eyes closed – with no realistic idea of how near or far they are from their destination.”
Most employees see their employer as a crucial source of financial help in navigating the pension minefields, with two-thirds (65 per cent) saying their employer should support them.
With this in mind, Ms Rix said: “We’ve launched a mid-life MOT for our people aged 45 and over to offer them guidance on their wealth, along with their work and wellbeing needs. Mid-life employees are the fastest growing employee population in the UK by age, and we urge other employers up and down the country to consider introducing similar schemes to ensure they feel fully supported.”
