There is absolutely no doubt that pension savings have grown after six years of Automatic Enrolment, but more progress is required to provide most people with better information about what they actually have, how it is invested and how exactly to provide themselves with adequate funds for retirement.
Automatic enrolment has clearly sharply reversed the downward trend in Workplace Pensions membership, which hit a low of 55% in 2012. Membership was at 84% in 2017 according to the Department for Work and Pensions.
In April 2018 the overall minimum contribution rate – normally made up of employer and employee contributions – rose from 2% to 5% of band earnings (£6,032 – £46,350 in 2018/19), with another increase to 8% due in April 2019.
The impact of automatic enrolment is welcome, but it is no guarantee of adequate retirement provision. For some, the state pension (up to £164.35 a week in 2018/19) and their auto-enrolled workplace pensions may be enough once work stops. But for many others, such as those with patchy employment records or who are already close to retirement, it won’t.
If you are worried about your retirement, ask us to project what your current pension arrangements may produce.
For Pension guidance – whether that is help in accumulating funds toward retirement or help in the vital decisions at retirement or managing your pension fund in your retirement years – please get in touch.
Please Note: Occupational pension schemes are regulated by The Pensions Regulator. The value of your investments, and the income from them, can go down as well as up and you may not get back the full amount you invested.