"If people are to achieve the retirement they expect, they need to start saving earlier and save more. However, this will not happen on its own."
- Peter Bedford MP - Future of Financial Services APPG
A cross-party group of MPs and Peers has called for the creation of a National Insurance Day to boost public understanding of pensions, encouraging earlier retirement saving and the importance of preparing properly for later life.
The recommendation is one of seven to follow the inquiry of the All-Party Parliamentary Group (APPG) into Income in Retirement, which identified low levels of engagement with pensions as a major barrier to achieving financial security in retirement.
The report also calls for pensions education to be included in the national curriculum, a pensions dashboard for workers receiving their national insurance number and a royal commission on dignity in retirement.
The APPG also recommended reforms to strengthen auto-enrolment, clearer pathways to adequate retirement income in defined contribution schemes, and a government-backed drive to increase the take-up of pension credit.
"The stark reality is that too many people are not saving enough for retirement. The evidence we heard was a wake-up call," Peter Bedford MP, co-chair of the Future of Financial Services APPG, said.
"Few people even approaching pensions age adequately engage with their pensions. Alongside my work on the Pensions Schemes Bill, this inquiry reinforced a simple truth: one of the biggest challenges facing our pensions system is a lack of public understanding.
"If people are to achieve the retirement they expect, they need to start saving earlier and save more. However, this will not happen on its own. We need a step change in pensions awareness, with government taking a proactive role throughout people’s working lives.
"That is why we are calling for practical reforms that help people understand their pensions, plan ahead and build greater financial security in retirement."
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Lord Sharkey, co-chair of the Future of Financial Services APPG, added: "Too many people are approaching retirement without a clear picture of the income they are likely to have in later life. The system needs a rethink with deliberate steps demarcated to ensure individuals engage with their pension and likely income in retirement.
"Our recommendations are designed to create a culture in which retirement planning becomes a normal part of working life. From better financial education to clearer information and stronger support, we need to equip people with the knowledge and tools to make informed decisions about their future. A good retirement should not be left to chance."
