Could setting realistic targets be key to keeping pensions New Year’s resolutions?
08 January 2018
- Only five days left to respond to the PLSA’s Hitting The Target consultation.
As the New Year gets under way, the Pensions and Lifetime Savings Association (PLSA) is reminding all stakeholders that the deadline for responding to its Hitting The Target consultation is 12 January 2018.
With 78% of people aged 18 to 64 years old saying they were not sure or did not know where to look to tell if they were on track with their retirement savings, the PLSA’s Hitting The Target consultation, which launched in October 2017, is designed to help people define and meet their retirement goals1.
One of the proposals is to develop a set of National Retirement Income Targets. PLSA research carried out ahead of the New Year found that setting a realistic target was the most common method (31%) chosen by people to help them achieve their New Year’s resolutions. This was followed by having a clear set of goals (21%), taking the time to focus on what needs to be achieved (15%) and having a clear set by set plan to follow (13%)2.
Nigel Peaple, Deputy Director, PLSA, said:
“Automatic enrolment has seen over 9 million more people enrolled into a pension scheme over the last few years3. Whilst this welcome success has achieved a great deal in starting more people saving towards retirement, we hope that income targets will address one of the key challenges facing savers today – that there is currently no generally understood target for retirement income. Our research has shown that 77% of people do not know how much they need in later life4. It is therefore great to see that so many people find targets and budgets helpful with financial resolutions – it suggests there is a strong basis for income targets working in practice.
“With our research revealing that 40% of respondents are planning to make financial New Year resolutions, we hope that people are considering their pension options5. This is a great opportunity to prepare not only for the year ahead, but for a better income in retirement.”
National Retirement Income Targets – which are currently used in Australia – provide savers with tangible income goals which take into account what they need to save in order to achieve different standards of living in retirement (minimum, modest and comfortable).
As part of the PLSA’s initial research, savers were asked for their views on what levels should be used for the income targets. Those between 55 and 64 years old suggested that for a single person they might be minimum - £10,000 to £15,000, modest - £15,000 to £25,000 and comfortable - more than £25,0006.
NOTES TO EDITORS:
1. Pensions and Lifetime Savings Association - PLSA launches consultation to improve UK’s retirement
2. Pensions and Lifetime Savings Association – New Year’s resolution research, 28 December 2016 – 2 January 2018
3. The Pensions Regulator - Automatic enrolment, Declaration of compliance report, July 2012 – end November 2017
4. Pensions and Lifetime Savings Association - PLSA launches consultation to improve UK’s retirement
5. Pensions and Lifetime Savings Association – New Year’s resolution research, 28 December 2016 – 2 January 2018
6. Pensions and Lifetime Savings Association - PLSA launches consultation to improve UK’s retirement
Lee Blackwell, Head of Media and PR, Pensions and Lifetime Savings Association
T: 020 7601 1726, M: 07713 073023, E: [email protected]
Kathryn Mortimer, Press Officer, Pensions and Lifetime Savings Association
T: 020 7601 1748, M: 07901 007713, E: [email protected]
Eleanor Carric, PR Manager, Pensions and Lifetime Savings Association
T: 020 7601 1718, M: 07825 171 446, E: [email protected]
New Year’s resolution research
The PLSA commissioned Opinium Research to conduct a consumer poll of 18+year olds in the UK about their thoughts on New Year’s Resolutions. Opinium Research interviewed 2004 British adults between 28th December and 2nd January 2018. Data were weighted by region to be representative of all British adults.
Hitting The Target
The PLSA commissioned Populus Data Solutions to undertake an omnibus poll of approximately 1,600 individuals aged 18 to State Pension Age (SPA) in the UK to examine attitudes towards saving for retirement. The poll was conducted between 4 and 5 September 2017. Data has been weighted to be representative of the UK population.
ABOUT THE PENSIONS AND LIFETIME SAVINGS ASSOCIATION:
We’re the Pensions and Lifetime Savings Association; the national association with a ninety year history of helping pension professionals run better pension schemes. Our members include over 1,300 pension schemes with 20 million members and £1 trillion in assets, and over 400 businesses. They make us the voice for pensions and lifetime savings in Westminster, Whitehall and Brussels.
Our purpose is simple: to help everyone to achieve a better income in retirement. We work to get more money into retirement savings, to get more value out of those savings and to build the confidence and understanding of savers.