Nearly nine million employees aged 45 and over are “sleepwalking” into retirement, unaware of how much they need to save, according to research from Aviva.
The report – which questioned more than 2,000 employees and scaled the results up to the UK population – revealed 64% did not know how much is needed to retire comfortably while 37% did not know how much they had already saved into their pension.
Additionally, two fifths of those surveyed were unaware of how much money they will receive from the government as their state pension, while a quarter did not know when they would actually qualify for the state pension.
The report, which looked at preparation levels of mid-life employees, also found 37% of respondents did not know whether they had a defined benefit or a defined contribution scheme.
Aviva’s analysis did reveal, however, that an employee aged 45 with no savings could build a pot worth £56,100 by the time they reach 65, based on an average salary of £28,000 and current auto-enrolment minimum contribution levels.
Most respondents (65%) agreed they should be calling on their employer for more support.
Managing director of savings and retirement Lindsey Rix said: “Millions of mid-life employees are flying blind, and fast, towards their retirement. At the same time these employees are calling upon their employers for help.”
Aviva has launched a mid-life MOT offering guidance on savings and Rix urged other employers to consider similar schemes.
Banking group Close Brothers head of financial education Jeanette Makings added: “To support individuals in feeling able to retire when they want, organisations can engage all staff with planning for retirement throughout their career, and not just in the final countdown years.
“Pensions are no longer the only solution to save for a secure retirement, but they are still the bedrock and most significant option for most employees.
“Regular monitoring, education, and engagement helps develop the necessary tools to take control, as well as helping guide them to make informed choices to suit their savings needs.”