More than a quarter (28%) of UK workers said they are more likely to start saving or save more into a pension scheme following the reforms announced in the Budget 2014, according to research by the National Association of Pension Funds (NAPF).
Its Spring workplace pensions survey 2014, which questioned 1,009 UK employees, found that 54% of respondents aged 18 to 24 were most likely to save into a pension following the Budget.
The proposed reforms will introduce greater flexibility around how pension scheme members can access their savings.
More than a third (42%) of lower-income workers, with a combined household income of less than £14,000 a year, also said they felt more attracted to pension saving.
Almost two-thirds (61%) of respondents felt capable of deciding what to do with their pension savings at retirement.
The research also found:
- 58% of respondents would prefer to receive a regular income for life rather than risk their money running out.
- 24% of respondents said they would take all of their pension savings as cash because they have other sources of income.
- 47% of respondents were worried their pension would run out.
- 19% of respondents said they would take their pension as a lump sum irrespective of whether or not they had other savings elsewhere.
Joanne Segars (pictured), chief executive of the NAPF, said: “It is encouraging that, following the Budget proposals, more than a quarter of people are more likely to save into a pension, with younger people and those from lower-income households especially motivated to start saving.
“Interestingly, more than half of those surveyed had a prudent attitude towards retirement income.
“However, we do need to make sure people are fully aware of the consequences of taking all their pension savings in one go if they do not have any alternative sources of income.
“Greater flexibility brings greater responsibilities and the decisions people will need to make when they reach retirement are undoubtedly complex.”