In research for this year’s Talk Money Week (8 to 12 November) the firm said taking time to understand future finances was key to achieving a comfortable retirement.
Head of retirement policy Jon Greer said many pension savers had not got to grips with organising their finances effectively ahead of retirement.
“While AE has had a positive impact on the uptake of pensions and retirement savings, many people are still struggling,” he said. “The Financial Conduct Authority’s Financial Lives survey showed that 9.6 million UK adults were not saving towards a pension at all, and some did not know if they were or not.”
It is imperative pension savers know they cannot rely solely on the state pension, he added, the full rate of which is £179.60 per week for the 2021/22 tax year.
“That £179.60 is far below what most people consider enough to support their retirement,” Greer added. “To ensure savers are comfortable financially, it is important to save additional funds to supplement it.”
Pension savers who have opted out of AE also need to reverse the decision, he said.
“They are likely missing out on valuable retirement benefits – not only their own saving towards retirement, but employer contributions too.”
Greer warned it was “a huge mistake not to engage with your pension pot”.
“While it may seem like a daunting task it needn’t be, and your future self will thank you for it,” he said.
Talk Money Week is an annual Money and Pensions Service initiative aimed at encouraging pension savers to talk more openly about their finances and improve their physical, mental and financial wellbeing in the process.