Helping employees plan for life after work

More than a quarter of employees (28%) told us they're not confident planning a financially comfortable retirement when we surveyed them about their retirement planning for our 2024 Working Lives report *.

75% of employees we spoke with told us they want more support and guidance from their employer with planning their retirement.

Pension providers have expertise and resources to support scheme members with their retirement planning, and employers should lean on them for support for their workforce. But there are some basic things employers can do to help employees:

1. Time

Encourage employees to start saving for retirement as early as possible – ideally at least 40 years before planning to retire.

2. Amount

If affordable, employees should aim to save at least 12.5% of their salary towards their pension every month. They don't have to do this on their own because employers make contributions on their behalf, and they get tax relief on the money they put in.

3. Final pot size

Employees should aim to build a pension pot of at least 10 times their annual salary by retirement.

4. Tax relief

Encourage employees to take advantage of the tax relief offered by the government to boost savings. When saving into a pension, of every ￡10 saved, tax relief reduces the cost by at least ￡2.

5. Investing wisely

Helping educate employees on the basics of investment could help them take more control of their ‘later in life’ planning. Employees should understand that their money is invested to help it grow over the long term, however, the value of their pension can go down as well as up and they may get back less than the amount invested.

6. Keep checking

Encourage employees to ‘check back in’ with their pensions. Annual pension statements can be used to track retirement targets and help employees build a clearer picture of their progress.

7. Online tools

Point employees towards free online retirement calculators which can help them keep feel more in control of their retirement planning. Aviva Retirement Tools and Calculators .

8. Reframe expectations

Reminding employees that life expectancy in retirement could be 20 years or more, which may help them reframe their retirement picture and save more appropriately. The Pension and Lifetime Savings Association’s Retirement Living Standards is a useful guide on how much money is needed for a Minimum, Moderate or Comfortable standard of living in retirement.

9. Lost pensions

Employees who've had multiple jobs are likely to have pensions associated with those previous roles. Encouraging employees to keep track of their pensions now can help them with retirement later.

For more help and support solving your pension puzzles, check out our website to learn more about the retirement solutions we can offer businesses of all sizes.

*1,001 full or part time employees aged 16+ in the private or charity sector were interviewed by Censuswide between 02-09 April 2024 to produce the data for this report. All stats presented here have been taken from the 2024 Working Lives report.