Almost three-quarters (68%) of employees believe they must take more personal responsibility for their pensions as the recession put significant dents in retirement plans. However, less than 30% say they feel comfortable managing this responsibility.
According to Towers Watson’s Global Workforce Study, which surveyed employee attitudes and workplace trends covering 20,000 employees from private sector organisations across 22 countries, 21% of private sector employees believe recent economic events mean they will have to work longer before they can afford to retire.
A further 10% expect to retire when planned but will have to scale back on their spending.
While 68% of UK employees believe they are personally responsible for providing for their own retirement income needs, 18% say the responsibility lies with their employer and 15% saying it rests with the government.
In addition, two-thirds said they would value more regular communications from their employers about reward and benefit programmes, while 65% would like greater simplification in how benefit and reward programmes are designed and administered.
Paul Macro, a senior consultant at Towers Watson, said: “Most employees today are aware responsibility for managing their career and finances lies with themselves and they also recognise that, especially for pension planning, the shift towards personal responsibility is ongoing.
“However, many employees do not feel comfortable managing the provision of their retirement income needs. While 37% say they are comfortable with the responsibility, 28% say they are not and 34% are uncertain. Many employees lack the understanding, education or tools to make the right decisions.
“Employers will have to build effective workforce management plans so mployees are not prolonging their working lives beyond the point where the relationship is mutually beneficial. With the decline of defined benefit pensions, and political support for extending working careers, employers are likely to face a demand for more flexible working practices at older ages.”
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