Over a third (37%) of savers contributing to at least one defined contribution (DC) pension are unaware of how much is being paid into their pot, personally and by their employer, Broadstone has found.

Analysing the Financial Conduct Authority’s (FCA’s) Financial Lives Survey, the independent consultancy stated that an alarming number of savers are unaware of their contributions, despite a lack of confidence over their financial security in retirement.

Just 34% of those surveyed said that they were confident about their later life income, with two in five (40%) disagreeing that their pension would give them the income they hoped for in retirement.

Furthermore, nearly a half (49%) have little to no idea of the annual income they can expect their DC pension in retirement.

Whilst inertia has been a driving force in creating millions of new pension savers, Broadstone has said that it could be acting as a drag on increasing the contributions necessary for savers to achieve an adequate standard of living in retirement.

This is highlighted by the fact that nearly three-quarters (74%) of savers with at least one DC pension have not increased the percentage of their salary they are contributing to their pot.

Head of DC workplace savings at Broadstone, Damon Hopkins, said: “It is abundantly clear that the next phase of auto-enrolment needs to see a transition from inertia to action – from the Government and employers.

“Having relied on inertia to get millions more people paying into workplace pension schemes, we need to rely on the same inertia to increase contribution rates if savers are to achieve the standard of living they desire in retirement.

“Despite lacking confidence about achieving their desired income in retirement, the FCA data shows that savers are still unaware how much they are contributing and how much income that will generate, let alone whether they’ll have enough in retirement.”

Hopkins added: “We still need employers and providers to play an important role in nudging savers and improving their understanding of their pension and retirement needs, while also ensuring DC schemes deliver robust risk adjusted returns and value for money.”

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