Three-fifths increase pension contributions if employer offers to match them


Around three-fifths (61%) of workplace pension scheme members opt to increase their pension contributions if their employer offers to match them, according to research by investment organisation Hargreaves Lansdown.

Its analysis of nearly 53,000 scheme members enrolled in the Hargreaves Lansdown workplace pension also found that 49% choose to increase their monthly pension contribution as a result of good communications.

Drilling down further, 49% of women and 48% of men decide to increase their monthly pension savings due to engaging communications, jumping to 58% and 64% respectively if employers provide a matching contributions structure.

A third (33%) of those under 30 are more likely to increase their pension contributions if offered matching contributions by their organisation; however, the same is only true for 18% of those aged over 50.

Seven in 10 (70%) of those with online access to their pension and available matching contributions from their employer are more inclined to up their monthly pension savings.

Nathan Long, senior analyst at Hargreaves Lansdown, said: “The optimum level of workplace pensions contributions are like Goldilocks’ search for the perfect porridge. With pensions, too little going in and people don’t have enough to live on in retirement, too much and they won’t have enough to live on now; they might even just opt out.

“While debate rages on what the level should be, the government should look to employers to incentivise higher contributions by offering to match additional contributions made by their employees. It’s an approach used by some employers already and is particularly effective at incentivising the under 30s to pay more in.”