Thursday, 06 September 2012 09:20
Employees failing to keep track of company pension schemes
Over 75 per cent of workers have no idea how much their company pensions are worth, according to Prudential.
The firm, a sponsor of the Institute of Financial Planning, surveyed over 2,000 people and found keeping track of company pensions was a difficult task for employees.
Some 81 per cent failed to actively transfer their company pension funds across to a new employer while 15 per cent relied on their new employers to do so. One in six said they had lost track of their pension when moving jobs.
Those who did know the value of their pension estimated it to be worth £110,207 on average. However, this differed between gender with men saving £154,094 and women only saving £50,512.
Stan Russell, retirement expert at Prudential, said: "Keeping track of pension savings at every age is important but it is even more crucial for younger workers, who are more likely to switch jobs more often, to actively manage the process.
"It's also important to consider the benefits of transferring previous pension savings into a new employer's scheme, although seeking advice before making such a big decision is a must."
The Government is introducing auto-enrolment for the largest firms next month with the aim of simplifying the company pension process.
Employees will be automatically enrolled into a workplace pension scheme, unless they voluntarily opt out, and this pension will move with them when they change jobs.
The firm, a sponsor of the Institute of Financial Planning, surveyed over 2,000 people and found keeping track of company pensions was a difficult task for employees.
Some 81 per cent failed to actively transfer their company pension funds across to a new employer while 15 per cent relied on their new employers to do so. One in six said they had lost track of their pension when moving jobs.
Those who did know the value of their pension estimated it to be worth £110,207 on average. However, this differed between gender with men saving £154,094 and women only saving £50,512.
Stan Russell, retirement expert at Prudential, said: "Keeping track of pension savings at every age is important but it is even more crucial for younger workers, who are more likely to switch jobs more often, to actively manage the process.
"It's also important to consider the benefits of transferring previous pension savings into a new employer's scheme, although seeking advice before making such a big decision is a must."
The Government is introducing auto-enrolment for the largest firms next month with the aim of simplifying the company pension process.
Employees will be automatically enrolled into a workplace pension scheme, unless they voluntarily opt out, and this pension will move with them when they change jobs.
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