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New report shows that saving makes sense now the Government should act on automatic enrolment

New research published today by the Government,[1] showing that saving makes sense as it substantially improves retirement income, is a positive step towards encouraging saving, according to the ABI. Maggie Craig, the ABI's Director of Life and Savings, said:

"The ABI has always said that saving makes sense. This report endorses the message that for most people, their workplace pension is the right choice. Joining your workplace scheme makes sense because you get free money from your employer and the Government that you would otherwise not receive, and most importantly because it will bring you a higher standard of living in retirement. The Government should build on this work by ensuring that the public is aware of the benefits of saving and able to make informed decisions about it.

"The ABI's own research has shown that almost half of the working population, some 13 million people, are not saving enough for retirement[2], and that almost 75% of people believe that the benefits of saving have fallen in the last year[3]. The Government's new study should help to improve confidence in long-term saving by illustrating clearly that it makes financial sense.

"In 2012, saving will be revolutionised by the new system of automatic enrolment into workplace pensions. But right now, almost five million people could be benefiting from free money from their employer and the Government, yet they haven't joined their workplace pension. The Government has a great opportunity to make sure that these people, and others who start working between now and 2012, can gain the benefits of pension saving, by allowing willing employers to use automatic enrolment as soon as possible. This report shows that saving pays - we urge the Government to make it easier for people to reap the benefits of saving now."

[1] Saving for Retirement: Implications of Pensions Reforms on Financial Incentives to Save for Retirement, Department for Work and Pensions, February 2009

[2] The State of the Nation's Savings 2007-08, ABI, November 2008

[3] ABI's Quarter 4 Savings and Protection Survey, January 2009

Last updated 01/07/2016