One in four employees fails to review their pension

Workers view their long-term savings goals as unachievable, and lack the confidence to choose the right financial products to change the situation, according to the large-scale research carried out earlier this year by Close Brothers of more than 5,000 employees.

Twenty-four per cent of employees with a pension never review it. Around a third feel unprepared for retirement, and only 43 per cent are confident that they will be able to retire at the age they want. Twenty-four per cent also expect to work in retirement.

The figures also reveal that while 60 per cent of employers are confident that their employees have a financial plan in place to help them achieve their future financial goals, this is the case for just 45 per cent of employees. Employers also woefully underestimate the impact of money worries on employees at work. Just 30 per cent think this is a major issue, when in reality it affects 77 per cent of employees.

The gender pay gap

As Equal Pay Day looms on November 14, the report also highlights the plight of female workers. Women are twice as likely to worry about meeting their day-to-day living costs than their male counterparts, according to the research.

The gender pay gap currently stands at 8.9 per cent for full-time workers, according to the Office for National Statistics, and this is reflected in the fact that 26 per cent of women are worried about making their money last until payday, while only 13 per cent of their male co-workers do so.

 Almost half (48 per cent) of women say they feel unprepared for retirement compared with 25 per cent of men.

A third of women say they are not confident that they will be able to achieve their long-term savings goals, nearly twice that of their male co-workers at 19 per cent. Women are similarly less confident choosing the most suitable financial products for their long-term savings goals.

Commenting on the findings, Jeanette Makings, head of financial education at Close Brothers, said: “Progress is being made, but the stark gender imbalance in financial wellbeing is a reminder of the scale of the challenge that still faces female employees and their employers. With more women in lower-paid roles, women are being paid less and therefore saving less, to the detriment of their financial wellbeing.” 

Professor Sir Cary Cooper, a leading expert in workplace wellbeing at Alliance Manchester Business School, University of Manchester, said: “It is quite right that the campaign for pay equality continues its march onward, but similar priority should be given to the financial wellbeing imbalance. Female employees must be given access to the necessary tools and guidance to bring their financial wellbeing levels up.”