Three quarters of savers opt for ‘pot for life’ pension

Almost three quarters (73%) of pension savers in the UK said they would consider opting for a ‘pot for life’ pension, PensionBee has found.

Research by the firm found that the majority would prefer this savings option, after the proposal was put forward by the Government in the Autumn Statement to improve the proliferation of lost pots in the UK.

When asked to share their preferences between a ‘pot for life’ or an alternative ‘stapling’ model, the former was more popular (73%) than ‘stapling’ (22%).

Stapling is an approach used in Australia, where employers pay workplace pension contributions into the employee’s first pension (typically the fault fund from their first job) unless they say otherwise.

These are stapled to the employee and the pot follows them from job to job.

PensionBee found that for those who are hesitant to choose a ‘pot for life’ pension, the most influential factor in potentially changing their option was a "clear provision of support from employers about what this is and how it works" (45%).

This is followed by a desire for the "provision of clear education from the Government" (42%) and a "comparison site or service to help choose a plan that’s right for their needs" (36%).

Director of public affairs at PensionBee, Becky O’Connor, said: "The reality is people change jobs, pensions get left behind, some are forgotten and retirements suffer.

"Having all of the pensions someone acquires in one place makes sense - the method for how this happens is the subject of debate.

"The verdict from the public so far appears to favour the ‘pot for life’ model, which allows people to choose their own provider and ask their employer to pay in.

"But the research also showed that provision of information from employers or Government would be key to uptake".

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