Confidence in pensions at an all-time low
Public confidence in pensions has hit a record low amid the ongoing economic uncertainty, according to the National Association of Pension Funds (NAPF).
48% of working adults are not confident in pensions, according to the research. This compares to 42% saying they are confident in the vehicles, resulting in a pensions confidence index of -6%. This represents the first dip into negative territory in the index's four-year history.
NAPF also cites low consumer confidence and recent sharp stockmarket falls as drivers behind the negative confidence in pensions.
The research also showed that almost 60% are not confident their pension will provide for them through retirement.
Joanne Segars, chief executive of NAPF, says: "It's worrying that from next year millions of people will be auto-enrolled into a savings vehicle they have so little faith in. Politicians have to boost confidence in pensions, or people will simply opt out. We need a pension framework that the public can believe in and rely on," she comments.
She highlights that the recent economic downturn has 'eroded faith' in the savings vehicles, with the recent stockmarket falls putting many people off contributing to one.
She adds: "Household incomes are very tightly squeezed and, with bills to pay, pension outlays can seem like the weakest link. There's also a perception that the goalposts are constantly being moved, so the government must stress the importance of saving."
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This article was written for our sister website Money Observer