[UK] Fewer save for pension despite the warnings of poverty

from The Scotsman

ALASTAIR JAMIESON CONSUMER AFFAIRS CORRESPONDENT

A DRAMATIC drop in the number of workers saving enough for their retirement has been uncovered, despite widespread publicity over the pension gap.

Less than half of workers are making adequate provision for the future - a drop of 10 per cent on last year, according to research by Scottish Widows.

There has also been a fall in the proportion of income being saved by people who are not members of a final salary pension scheme.

The study of more than 5,000 Britons found that employees who are not members of one of these schemes are setting aside an average of just 5.8 per cent of their pay, down from 7.9 per cent last year and less than half the amount Scottish Widows recommends they should be saving.

The problem is worst among women, with one third failing to set any money aside compared with a quarter of men.

The study also found the average value of investments had risen from £16,000 to £24,300 in the past year, suggesting that Britons are putting more faith in property or savings accounts than in pensions.

Ian Naismith, head of pensions market development at Scottish Widows, said: "The deterioration is very disappointing when you consider how high profile pensions have been in the last 12 months."

Stuart Glendinning, of the consumer website Moneysupermarket.com, said: "Few companies are actively promoting the government's stakeholder pensions because there is no incentive."