Why nation's workers are split on whether they will have a comfortable retirement
Just over half (52 per cent) of people with a defined contribution (DC) pension pot feel they will be comfortable financially in their later years – with 48 per cent of people feeling otherwise, a new survey has found.
DC pensions are commonly used as workplace pensions and the retirement income you may eventually end up with will depend on factors such as how much you pay in, how well your investments perform and how you decide to use the money in retirement.
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Hide AdThe research, carried out for consultancy Barnett Waddingham also found that it is often older workers who feel less confident about their retirement prospects.


Worryingly, nearly a third (32 per cent) of people set to retire within two years are not confident their later years will be comfortable.
More positively, seven in 10 (71 per cent) adults aged 24 and under are confident about their retirement prospects, as are six in 10 (61 per cent) 25 to 30-year-olds.
Automatic enrolment into workplace pensions started in 2012, meaning that employees save into a pension scheme unless they decide to opt out. They also receive a pension boost from employer contributions and tax relief.
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Hide AdIn contrast to the younger generations, only around two-fifths (42 per cent) of 51 to 55-year-olds feel confident about their retirement.
Confidence was found to jump up slightly for people aged 55-plus, with half feeling confident.
Older workers who do feel confident about their retirement prospects are also particularly likely to have a defined benefit (DB) pension pot as well as their DC pension savings, the research found.
DB pensions promise to pay pension savers a certain income when they retire, based on their salary, such as final salary pensions.
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Hide AdBut Barnett Waddingham warns that only saving the minimum amount into a pension could leave people with a shortfall in their retirement – if they plan to rely on their pension alone.
A quarter of people who aren’t confident about retirement simply don’t know what a comfortable retirement would look like or how to get there.
Mark Futcher, a partner and head of DC pensions at Barnett Waddingham says: “In a rare glimmer of good news, people are currently more confident about retirement the closer they are to it, meaning something is going right.
“But there are two key areas for concern. Firstly, a third of people planning to retire in a couple of years are going into that period of their life without confidence that they’ll be able to live comfortably.
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Hide Ad“And most people who are confident are such because of other wealth, property, or private and DB pensions.”
The research was carried out by Censuswide for Barnett Waddingham among more than 2,000 UK employees with a DC pension, in March.
Futcher also has some tips to help people become more “pension confident”.
While not everyone is in a financial position to increase their pension contributions, paying in more may help to boost pension confidence.
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Hide AdIn general, the earlier someone pays money in, the longer that money has to grow in the pot. Bear in mind the value of investments can go down as well as up.
Futcher says: “Check that you receive the maximum contribution from your employer, particularly if they use a tiered contribution structure.
“Additionally, using pay rises as a prompt to increase contributions can enhance your confidence in securing a comfortable retirement. If you increase your contribution at every pay rise, you won’t notice the impact on the amount you take home each month.”
Also, remember that knowledge is power. Knowing how much you have in your pension (and any other pots with previous employers) can help you to understand if you’re on track with your retirement savings.
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Hide AdIf you’re struggling to understand pensions, you could try the Government-backed MoneyHelper website, or ask your employer to point you to where you can find out further information about your workplace pension.
Over-50s can also use the free Pension Wise guidance service.
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