Stakeholders fail to make the grade
20 May 2004
Stakeholder pensions have failed to plug the gap caused by the retreat from occupational pension schemes in Wales, according to new TUC research
The research shows that less than three in a hundred workers have taken up stakeholder pensions, and that they are saving less than half they need to secure a good pension when they retire.
Experts say that people need to save 15 per cent of their salary throughout their working life if they are to retire with a reasonable pension at a reasonable age.
This means that an employee on the average wage of £21,398 a year in Wales needs to put by £3,210 a year or £267 a month. Yet the average contribution to a stakeholder pension from both employee and employer in employer sponsored stakeholder pensions is just over £1,000 (£1,081) - a shortfall in Wales of £3,210 a year or £177 a month.
Wales TUC general secretary Felicity Williams said: "There is nothing wrong with stakeholder pensions in theory.
"They are a good investment for anyone who does not have a quality occupational pension. But these figures show that they are failing to take up the slack caused by employer retreat from good pensions."