Over half (53%) of savers have said they see the move towards a pot for life as a positive change to the UK pension system, Barnett Waddingham has revealed.

Despite this, the firm stated that there is a crisis in confidence across the 2,000 UK workers paying into a defined contribution pension that were surveyed.

Half (54%) of those savers said they would be more engaged with their pension should the pension system move towards a pot for life method, with over a third (38%) believing it would make them more confident about retirement.

Barrett Waddingham said that the pot for life system has many benefits, which includes reduced the number of pots people may accumulate over a lifetime.

It went on to state that this is a "significant problem" in the UK, with 4.8 million pension pots considered lost in 2023.

However, half (49%) of respondents said that the pot for life system makes them nervous of making bad decisions. This rises to 53% for women and 58% for people aged between 51 and 55, which is the age where people are most likely to be planning for retirement.

Partner and head of defined contribution pensions at Barnet Waddingham, Mark Futcher, said: "Issues of apathy, low financial literacy, and chronically low pension saving won’t be fixed by a pot for life.

"A fresh coat of paint won’t hide the mould for long, and there are some very big pension problems the Government must fix before a pot for life will work. Increasing auto-enrolment levels, auto-escalating contributions at the point of pay rise, and lowering the contribution age threshold are just a few hopeful breadcrumbs.

"The Government must work with the industry, not against it, to create the best outcomes for pension savers. This means enacting reform to ensure the country has a financially engaged, and confident population that clearly understands their path to retirement - whatever that model may look like in 10 years’ time."

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