Take action to shape your retirement

Alistair McQueen, Head of Savings and Retirement at Aviva, reflects on the success of auto-enrolment in the UK and how more of us can take action to shape our own retirement.

Without question, auto-enrolment in workplace pensions has been a success. Government statistics published in June last year revealed that 18.9 million eligible employees are regularly saving for their retirement through a workplace pension.

This is a marked contrast to the eight million eligible employees who were participating in workplace pensions in 2012, the year auto-enrolment began. Today, the number saving is closer to 20 million.

More help is needed

Despite this very positive news, concern remains that most people are still not saving enough for their retirement; and that too many people are missing opportunities to manage their pension to their best advantage.

6%

Research by the Financial Conduct Authority (FCA)1 revealed only 6 in 100 adults took financial advice last year.

Change is certainly needed to make sure more people have the opportunity to access guidance. However, there are steps everyone can take now to get relevant help at key stages of life. Providers, like Aviva, are also taking further steps to increase people’s engagement.

Serving UK consumers better

The FCA has described how the financial market can serve UK consumers better, through:

  • Good availability of affordable advice at all stages of life.
  • Innovation in the interests of consumers.
  • A range of channels giving people access to advice and guidance.
  • Wider engagement amongst consumers in their financial affairs, so they seek out help.

The advice term is specific. In financial services it indicates a bespoke service that is paid for. Unfortunately, it is the fear of unknown costs that often puts people off seeking help.

Free to access services

Fortunately, there are UK government services that provide free and impartial guidance, including The Pensions Advisory Service and Pension Wise. These are great starting points for everyone who wants more information on their options for long-term financial planning.

Online services such as the Money Advice Service, established by the UK government, are good sources of guidance for finding a financial adviser. They provide tips on deciding what kind of adviser you need and how advisers charge. Useful if you decide you want more individualised guidance after accessing the free pension services.

The role of employers

If in a workplace pension, you should feel able to ask your employer for updates on the performance of your pension and the flexibilities it offers. 

Elderly couple relaxing outdoors
Employers can help their people to be more informed about their workplace pension.

Employers can work with the pension provider to make sure this happens.

Some employers create regular opportunities for employees to meet with the workplace pension provider. At these sessions, employees can ask questions about any aspect of their pension and gain general pension information.

At Aviva, we offer our UK employees aged 45 and over a Mid-Life MOT. This annual check-up helps people consider their wealth, work and wellbeing. The three big things that will have a significant impact on your retirement.

Meet Laura

We continuously review how we help our customers. Whether through digital innovation, integration of the help and guidance we give, or by using our savings and retirement knowledge to influence positive regulatory change.

We want all our customers to make informed decisions about how much, how long and where to save and invest.

We helped 33-year-old Laura, who wanted to understand how to achieve her goal of retiring early and still living as comfortably as she does now.

It was really great to have someone who was sitting there explaining things to me in a way that makes sense because I’m not particularly financially savvy.

Watch Laura’s story

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More encouragement

With lots of free pension information available, the millions saving for retirement needn’t miss out on much-needed help. But more should be done to promote the guidance that’s available and to encourage people to engage more in their retirement savings, before it’s too late.

[1] Source, FCA, page 10 - https://www.fca.org.uk/publication/research/famr-baseline-report.pdf

Related reading

Aviva’s Investment, Savings and Retirement division
Dedicated to helping people save for retirement with sufficient income.

Mid-life MOTs
Help with financial planning for people in the middle of their lives

MyAviva
One place to view and manage your Aviva insurance, savings and investments policies

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