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Majority of Brits support compulsory pension saving, says LCP research
Majority of Brits support compulsory pension saving
Lane Clark & Peacock (LCP) and YouGov
3 Dec 2018 United Kingdom Automatic Enrolment, Savings
Key Details:

  • 66% of British adults support compulsory pension saving
  • 78% of British adults aged 55+ support compulsory saving, potentially indicating pensioner regret at missed opportunities to save earlier in life
  • Findings come ahead of the April 2019 increase in auto-enrolment minimum contributions
  • Greater compulsion would mirror Australian model
  • Two thirds (66%) of British adults are in favour of mandatory pension contributions, according to new research from pensions consultants LCP and research analysts YouGov. For those aged 55 and above (those in the age group typically approaching, or already in, retirement), this figure rises to more than three quarters (78%).
  • A generational shift in attitude is evident as only half (50%) of those aged 18-24 believe pension saving should be compulsory. The jump to 78% supporting compulsory saving for adults aged 55 and over suggests regret at missed opportunities to save earlier in life and that, for Brits, the reality of retirement is biting late.
  • Views varied regarding the level of savings considered adequate, but again there was a gulf between younger and older generations, highlighting the potential perception gap that exists between what people think is sufficient for a comfortable retirement, versus what may actually be necessary.
  • When looking at combined contributions (from themselves and their employer) 21% of workers felt that the total amount that should be saved was at least 11% of their monthly salary. However, 11% of 18-24 year old workers thought that just 1-2% of their total monthly salary was enough to give financial security in retirement.  The proportion who felt 1-2% of their monthly salary was adequate fell to just 2% for those workers aged 45 and over.
  • Across all ages, a quarter (25%) of workers said they did not know what they thought the minimum combined contribution should be.
  • If the UK were to fully embrace compulsion it could mirror the Australian model, a system of compulsory contributions from both employers and employees. Australian savers are also encouraged to supplement their compulsory contributions with further, voluntary contributions. Greater compulsion, possibly with a limited flexibility to opt down and not just opt out, would bring significant benefits and mean higher default saving levels for the UKs future pensioners.
source: LCP Press Release