United Kingdom 2020: Workplace Pensions Consumer Study - Most Workplace Pension Holders Were Automatically Enrolled

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May 12, 2020, 15:15 ET

DUBLIN, May 12, 2020 /PRNewswire/ -- The "Workplace Pensions Consumer Research Report 2020" report has been added to ResearchAndMarkets.com's offering.

55% of all consumers have a workplace pension

Over half of all consumers have a workplace pension and among consumers with workplace pensions, most (51%) have a defined contribution (DC) pension with just over four-in-ten owning a final/career average pension. 85% of adults with a workplace pension have a pension with their current employer, with 15% having legacy pensions from previous employers.

This report is a consumer research report looking at how individuals are using workplace pensions to save for their retirement. For this report, the author commissioned research from MIS Group's UK panel. The research was structured so that 2,077 nationally representative consumers aged 18+ were asked about their pension ownership and savings. This generated 1,142 individuals who had a workplace pension and 975 individuals who had a workplace pension with their current employer.

Workplace pension ownership shows clear gender, age, social grade and income variations:

More mature female workers - more likely to have Occupational DC pensions
Older affluent males - more likely to have occupational DB pensions
Younger affluent males - more likely to have GPP pensions.
Older individuals are more likely to have occupational pensions compared with younger adults.

In some respects, occupational DC pensions are the female alternative to the male-dominated occupational DB pension, while GPP pensions are the young, male alternative to the mature, male-dominated occupational DB pension.

Almost six-in-ten workplace pension scheme members were automatically enrolled into their company's scheme, i.e. they were told they were joining the scheme but not asked their permission, with four-in-ten workplace scheme members making a pro-active choice to join their company's workplace pension. Those auto-enrolling tend to be younger and less affluent workplace pension holders. Auto enrolled scheme members appear to have lower engagement with and a weaker sense of personal ownership of their pensions compared with pro-active joiners, with the result that they seem to have less knowledge of their pensions compared with pro-active joiners and are more likely to join a scheme without getting professional pensions advice.

Pension understanding and the delivery of pension advice and guidance can be improved in two ways:

Mature, older workplace pension holders. A pension dashboard and/or a website offering pension advice appeals strongly to this group.
Younger workplace pension holder and new joiners. A fully automated online advice service appeals strongly to this group, to be used as a substitute for contacting a human advisor or as a complement to human advisory service.

The dashboard and the non-automated online advice service are more applicable for those nearing retirement, while an automated service is more applicable for those taking out a pension for the first time.

Key Topics Covered

1. Executive Summary

Most workplace pension holders have DC pensions
And over eight-in-ten have a pension with their current employer
Most workplace pension holders make contributions
Most workplace pension holders were automatically enrolled
And around half join their company schemes without getting professional advice
Many pension holders lack understanding and knowledge
Which may explain the uncertainty about retirement income
Lack of knowledge can lead pension holders to make mistakes
Improving pension understanding and the delivery of advice
With online delivery an important element

2. Introduction

3. Workplace Pension Ownership

Over half of consumers own a workplace pension
Occupational workplace schemes the most popular forms of pension
Final salary/career average pensions, something for the mature affluent male
Seven-in-ten workplace pension holders make personal contributions

4. Joining a Workplace Scheme: An Informed Choice?

An active or passive decision?
Auto-enrolment reduces active choosing for the young
Is it a decision based on advice?
Auto-enrolment reduces informed choosing

5. Pension Understanding

Pension knowledge is generally poor
Less than one-in-four pension holders have good knowledge
Auto-enrolment results in diminished knowledge
Which may explain why many are uncertain about their retirement income
Lack of knowledge can lead pension holders to make mistakes

6. Ways to Improve Knowledge and Decision Making

Is it advice or guidance which is in demand?
GPP pension holders the most willing to pay for advice or guidance
Can online delivery improve the distribution of advice or guidance?
Pension holders In the Light often have a greater appreciation of online tools
Over half of workplace pension holders open to a commercial automated service

For more information about this report visit https://www.researchandmarkets.com/r/vc25xd

Research and Markets also offers Custom Research services providing focused, comprehensive and tailored research.

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Research and Markets
Laura Wood, Senior Manager
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SOURCE Research and Markets