You understand the importance of getting ahead of the game and that saving for your pension is one of the most important ways to prepare for the future.
We all want to be able to spend our retirement doing the things we love – spending time with grandkids, going on holiday and finally getting to enjoy those hobbies we had to put off for years.
That is why saving for retirement is so important; it gives you the freedom to spend your time how you want. A workplace pension is one of the best ways to achieve this. If you earn more than £10,000 and are employed, then you will be enrolled into a workplace pension.
It is a great way to save – when you pay in your boss pays in too; any savings into the scheme will also grow as they are added to by compound interest and could benefit from tax relief. That is why when you work, your workplace pension will too.
It is clear that Yorkshire and the Humber has well and truly embraced automatic enrolment. Over 660,000 people are boosting their pension pot, turning around a decade of declining savings before automatic enrolment was introduced in 2012.
Employers in the region are also leading the way with over 70,000 enrolling their staff into a workplace pension, doing their bit to help more than 9.4 million employees across the country set themselves up for later life. This would not have been possible without their hard work and continued support.
Small businesses are the driving force behind the economy and, once again, they have risen to the challenge and helped millions across the UK into a workplace pension. Automatic enrolment has seen a large number of savers under the age of 30 enrolled, with almost seven in 10 eligible 22 to 29-year-olds working in the private sector now participating in a workplace pension.
As a result of this policy, more women are saving into a pension than ever before and future generations of women will enjoy the same retirement provision as men and will have the opportunity to reap the benefits in retirement.
Most importantly, recent research suggests that we are developing a new British savings culture, with 83 per cent of employees now seeing saving through a workplace pension as routine; 80 per cent positive about the benefits of being enrolled onto a workplace pension; and 79 per cent stating they would welcome increasing their savings alongside employer contributions.
If we cast our minds back to 10 years ago, one of the biggest issues facing pension policy was how do policymakers like myself encourage more people to save for retirement.
Well it is now unquestionable that automatic enrolment has gone an enormous way to solving this issue. We are transforming retirement savings for millions, who will be able to enjoy a more financially secure retirement with a private workplace pension built up over decades.
With contribution rates recently increasing from two to five per cent, we can all start to look ahead with some more confidence about retirement. Although most people are paying more already, if you can save little and often, your money will go further. The workplace pension is changing the retirement outlook for millions – and many will reach retirement with a private pension as a result. But there is still more to do to ensure that everyone is building up good private pension savings.
I am determined to continue the expansion of pension saving and ensure that hard-working people can work towards a larger pension pot in retirement. A private pension should not be a privilege. Instead it should be something that the majority of people can save into and use it to add to the State Pension they can expect.
Foremost in my mind is how to make sure that as many people as possible are able to take advantage of the private workplace pension. We are all living longer and healthier lives and the people of Yorkshire and the Humber can be comforted by the knowledge that they are saving into their workplace pension.
Guy Opperman is Minister for Pensions and Financial Inclusion.