Research published today by the Department for Work and Pensions looks at private pension provision among people of working age in Great Britain; and people’s attitudes towards pensions and saving for retirement.

The survey reveals workers are worried about not having enough to live on in retirement but are largely ignorant about pensions.

Only 13% of interviewees claimed they had a good knowledge of pensions and 47%, admitted that they knew very little about pensions.

Most workers hoped to retire at 60 or 65, but had no idea how much they would have to save to enjoy a comfortable old age. Even among those within 5 – 10 years of retirement just under half reported a `good’ or `reasonable’ idea of what their income in retirement would be.

The main findings are as follows:

• Almost seven in ten people of working age have had a private pension at some point in their working lives although only half currently held one at the time of the survey (in March 2002).
• Ownership of private pensions varied across the population, with age, income and employment status being particularly important. Groups less likely to have a private pension included the self-employed (half of whom had a private pension compared with two thirds of employees) and part time workers (four in ten of whom had a private pension).
• The main reasons people gave for not currently having a private pension were affordability, not being in work or being too young to take out a pension.
• Few people of working age (13 per cent) thought that their knowledge of pensions issues was good. Almost half (46 per cent) reported that their knowledge was patchy or amounted to ‘little / nothing’.
• People with private pensions and higher incomes tended to be more knowledgeable about pension issues in general and about what their income in retirement was likely to be.
• Sixty one per cent of people had heard of Stakeholder pensions at the time of the survey in March 2002. This was a substantial increase on the 25 per cent who had heard of them in a similar survey two years earlier. However, of those who had heard of Stakeholder pensions, around half had heard of the name only.
• Most people who were more than 15 years away from the age at which they expected to retire were uncertain about what their income in retirement might be. Even among those within 5 – 10 years of retirement just under half reported a `good’ or `reasonable’ idea of what their income in retirement would be.
• Seven out of ten people reported having given ‘a lot’ or ‘some’ thought to their retirement arrangements. This varied by age and by how close people were to the age at which they expected to retire. People who had not thought about retirement tended to be younger, on low incomes and not to have any private pension provision.
• The median age at which people expected to retire was 60. Women were more likely than men to expect to retire at 60, even those women who will not receive their state pension until they reach 65.
• Most people expected a relatively long retirement of 20 years or more and while most had private pension, a third did not.
• Most people thought that putting money into a pension was the most secure way of providing for their retirement, although a sizeable minority (29 per cent) did not think this.
• When asked what source of retirement income they expected to rely on mainly, a third of people said occupational pensions, 14 per cent said personal pensions and 20 per cent said the basic state pension. Among those within 10 years of retirement only one per cent said they expected to rely on social security benefits as their main source of income.
• While only ten per cent of people expected their main source of income in retirement to be their partner’s pension, married women were more likely to mention this source, particularly married women who were not working at the time of the research, 54 per cent of whom gave it as the main source.
• Thirteen per cent of people expected non-pension sources to provide the majority of their income in retirement. People who did not view pensions as a secure way of saving for retirement more likely to say their main income would be from non-pension sources.
• When asked what an ‘adequate income’ would be to live on if they were retired today, just under half of respondents said a weekly income of up to £250. Just over half of respondents thought the weekly amount that would be adequate to live on if they were retired today was equal to, or more than, their current weekly income.
• It is questionable whether it will be possible for many people to achieve an income in retirement to meet their expectations, particularly the eight per cent of people who reported an adequate income that was more than their current income and had never had a private pension.
• People were evenly split on whether the individual (46 per cent) or the Government (44 per cent) should be mainly responsible for ensuring people have enough to live on in retirement. Only a minority (7 per cent) felt that this should be the responsibility of their employer.