A recent survey has revealed that employees from all across the age spectrum have considerable gaps in their financial knowledge. Out of over 500 respondents, more than seven in ten of people from the generation X and millennials age groups did not have an understanding of pension investments. Additionally, 49% of those surveyed said that their preferred method of receiving financial advice was face to face.
The last figure in particular suggests that employers need to considerably improve the financial education offered in the workplace. This will allow those working for them to be better informed about the financial opportunities they can go for, their options when planning their pension, and their overall financial health.
Millennials (respondents aged 18-29) named saving for a house as their greatest financial priority, with 44% of those surveyed putting it at number one. Worryingly, 71% of this group said that they do not understand pension investment, a figure that rises to 96% in those earning less than £20,000 a year. More promising, however, is the statistic that nearly nine out of ten said they would put more into their pension if they could afford to do so.
Those aged between 30 and 49, considered generation X, generally named planning for their retirement as the least of their concerns, despite the fact that it should undoubtedly be a major focus for them. In contrast, 42% said that they had lost sleep over paying their mortgage. When it comes to understanding pensions, there is a major disparity between earning brackets. Whilst 44% of those earning over £75,000 a year felt they had an adequate understanding, not a single respondent earning under £20,000 felt that they had any grasp of pension investments.
Unsurprisingly, those in the baby boomer bracket aged 50 and over had the greatest financial awareness. More than half named retirement as their top financial priority, with 43% saying the pressures of preparing financially for when they stop work has kept them awake at night. 57% also said they were planning to go part time with their employer if possible, phasing into retirement rather than stopping work straight away, a figure which surely would have been much lower in previous generations.