Critical factors for successful retirement planning
Employee engagement and financial education have been described as two critical factors needed for successful retirement planning.
The latest Workplace Pensions Report from Scottish Widows has found that 42% of respondents with a defined contribution (DC) pension scheme did not know how much their employer actually contributed.
This is a worrying figure, particularly when the majority of employees are reliant on their company pension as their main source of retirement income.
The Scottish Widows report goes on to highlight the continued shift from defined benefit (final salary) to defined contribution pensions, with only 29% of those under the age of 30 in a defined benefit scheme.
We agree that employee engagement and financial education are two critical factors for successful retirement planning. We often speak to people who are unsure of the details when it comes to their company pension scheme.
Part of our role as Chartered Financial Planners is to help our clients to understand the benefits they will receive from their employment and how these tie in to their wider financial planning.