UK pensions: Only three per cent of employers have helped staff understand changes to the lifetime and annual allowance for pension contributions, which are due to come in this April
Some big changes are on the horizon for pensions, but just a handful of businesses are taking action to help their employees understand them, according to a new survey.
Research released today by Close Brothers Asset Management has discovered that only three per cent of employers are offering specific support to staff members who are likely to be impacted by incoming changes to lifetime and annual allowances, despite roughly 300,000 savers potentially being affected by the new rules.
"The pension reforms themselves have heightened the need for financial education as with greater choice comes greater complexity and individuals need to be aware of the impact on their finances and need more guidance to make good decisions," said Jeanette Makings, head of financial education services at Close Brothers Asset Management.
The changes, which are due to come in this April, will see annual allowance reduced on a sliding scale for those with a total taxable income of £150,000 or over from £40,000 to as little as £10,000.
Read more: Millennials should be saving £800 a month for retirement
At the same time, lifetime allowance will be slashed from £1.25m to £1m.
Makings continued:
"Employers are in a unique position to play a central role in helping their employees to understand and make the right choices. Addressing new reforms as they come along can easily be built into existing financial education programmes. Once introduced, it can lead to a workforce which is confident, knowledgeable and far more productive throughout their career and greater brand ambassadors on leaving."
However, research released last December by professional services firm PwC showed that some employers had already started planning, with 26 per cent reviewing the role pensions play as part of their reward package for all of their staff in light of the new limits.