- A third (32%) of Brits rank pension admin last on their to-do list – and are more likely to prioritise managing hair and beauty appointments and planning holidays
- More than a fifth (22%) of pension savers admit they don’t check their pension annually because they don’t know what they should be doing
- One in seven don’t know where to access their pension information (16%)
- This Pension Engagement Season, Standard Life provides tips for reviewing pensions and staying on top of admin
Pension Engagement Season is in full swing, however, pensions rank bottom of Brits’ ‘life admin’ to-do lists, according to new research from Standard Life, part of Phoenix Group, with a third (32%) saying it’s their lowest priority admin task, despite the impact it has on people’s futures.
Pension paperwork falls behind managing personal appointments with hairdressers or beauticians, with 25% putting this in last place, while 18% say planning holidays is last on their to-do list.
Brits life admin priorities
|% Bottom of the list
|Managing household utilities
|Managing and planning healthcare matters
|Planning meals and making shopping lists
|Managing personal/ household finances
|Managing and planning social life
|Planning holidays and making reservations
|Managing and planning personal appointments
|Managing/ checking pension
Pensions left unreviewed because people don’t know what they should be doing
Even when consumers get around to pension admin, Standard Life’s research found that more than a quarter (27%) only check their pension once a year or even less frequently, while 14% admit they’ve never even looked at theirs.
Among those who don’t check their account at least every year, a fifth (22%) say this is because they don’t know what they should be doing. Worryingly, this rises to a third (34%) of 35 – 54 year olds, compared to 26% of 18 – 34 year olds and 11% of over 55s.
Meanwhile, 16% of those who check the pension less than once a year say it’s because they don’t know where to access the information, while 15% simply say they don’t know how to check it. In addition, 13% don’t believe they have enough savings to engage with their pension and 12% don’t review theirs because it’s overwhelming.
Dean Butler, Managing Director for Retail Direct at Standard Life, part of Phoenix Group said: “Checking and managing your pension might not always seem like a priority, however like any life admin task there’s a sense of satisfaction when it’s done and with pensions playing such a big role in peoples’ financial futures, it’s important to try and stay on top of it. When life is busy it’s easy to let pension admin fall to the bottom of the to-do list, but if you can find time at least once a year, it can make a big difference later in life. It doesn’t have to be complicated – simple steps like reviewing what’s in your pot, what that could give you in retirement, reviewing your contributions and seeing if you’re happy with how much you’re putting it, are good places to start. It’s worth keeping an eye on your pension even early on in your career, to make sure you’re making the most of the potential for your savings to benefit from compound investment growth – which is growth on earlier growth.”
Dean Butler shares top tips to help you review your pension:
- Find out where you are right now - "Many of us aren't entirely sure how much we already have saved up in our current pension plan, but it's important to know how much you've got so far because it can highlight if there's a shortfall between what you'll have and what you'll need. For help with knowing what you might need, the Retirement Living Standards tool from the Pensions and Lifetime Savings Association is a great place to start, clearly showing what life in retirement looks like and the income needed at three different levels - Minimum, Moderate and Comfortable. As well as everyday costs, the tool factors in what's needed for extras - gifts, holidays and large purchases etc., as well as having an emergency fund for unexpected costs.. When reviewing your current situation, it's important not to forget to include any pensions you might have with previous employers or that you've set up yourself. If you think you might have 'lost' some pensions along the way, the Government's pension tracker website can help. There are calculators available that you can then feed this information into which will give you an idea of how much could be available to fund life after work, and help you make plans and decisions for the future."
- Take advantage of a workplace pension and top up contributions if you can - "In the current climate, of course you might need to prioritise short term spending needs, however when offered the opportunity to join a workplace pension scheme, it's nearly always a good idea to do so. For most people, your employer must automatically enrol you in a workplace pension scheme, and you may still be offered a pension plan even if you don't meet the eligibility criteria for auto-enrolment. Workplace pension schemes are made up of your own payments (5% or more of earnings) which are deducted from your salary, often before you pay tax, making it easier to save, and your employer's contribution, which at the very least, must be equivalent to 3% of your earnings. Many employers offer more than this or match any extra payments you make so it's worth checking if you're getting the most out of this valuable benefit.
For those in a position to do so, it's worth considering increasing your pension payments - putting in a small amount each month could go a long way, especially if you start young, as you benefit from compounding (the effect of potential growth on growth). If your circumstances allow, think about making one-off payments into your pension too, for example if you receive a work bonus or an inheritance".
- Adjust for any changes - "If it's been a while since you last gave careful thought to your pension plan, your plans or circumstances could have changed. For example, the date when you think you'll retire might have changed. It's worth knowing that you don't usually have to wait to state pension age (currently 66) to take money out of your workplace or private pensions. Usually, you can start taking your pension money at age 55 (although this is due to rise to 57 from 2028). However, bear in mind that if you do access your pension benefits, it could limit what you could save into a pension in the future and will leave you with less money to provide a retirement income at a later date.
"It's also possible that the investment choices you made years ago when you set up your plan aren't as suitable for you now as they were then. So, it's important that you regularly review your pension investments to make sure they're still right for you and your goals."
- Think long-term and diversify - "As your pension savings are invested, they can go up and down regularly in value. However, you'll usually be saving into your plan for many years, and generally over longer periods investments can provide better returns than, for example, putting money in a savings account. Try not to worry when you see these ups and downs - remember to focus on the long term. You can reduce the risk of large fluctuations in value by having a mix of different types of investments - also known as diversifying. Most workplace default investment options will already do this for you, while many personal pensions also have options that package together different types of investments if you don't have the time or experience to build your own portfolio. It's always a good idea to use a financial adviser when making decisions about your investments- while this does usually have a cost attached. Remember, you can also contact your pensions provider.
- Consider bringing all your pension plans together - "It can be hard to keep up with pension admin. If like many people you've collected several pension plans over the years from different jobs, it could make sense to combine them and minimise the paperwork. It's not right for everyone, but it can be a good way to get a better picture of your overall pension value, make it easier to check if pension investments are on track and could cut down on the charges you pay too. However, it's important to be aware there's no guarantee of a better pension plan by transferring into one plan and you could be giving up valuable benefits or guarantees held with other plans, so you may want to seek advice before doing this."
Notes to editors:
Research conducted amongst 2,000 UK adults on behalf of Standard Life by Opinium from 29th August – 1st September 2023.
About Standard Life
- Standard Life is a brand that has been trusted to look after peoples' life savings for nearly 200 years
- Today it proudly serves millions of customers who come to Standard Life directly, through advisers and through their employers' pension scheme.
- Standard Life is part of Phoenix Group, the largest long-term savings and retirement business in the UK. We're proud to be building on nearly 200 years of Standard Life heritage together
- Our products include a variety of Pensions, Bonds and Retirement options to suit people's needs, helping our customers to invest and save for their future. We're proud to offer a leading range of sustainable and responsible investment options.
- We support our customers on their journey to and through retirement with comprehensive, easy-to-understand guidance so they can invest in the right way for their needs, and plan a future they feel confident about
- The value of investments can go down as well as up and may be worth less than originally invested.