'Shocking' lack of awareness of state pension details, survey finds
An "alarming" lack of awareness of the new state pension among working-age people has been uncovered by a survey, just days before the scheme launches.
The new state pension, introduced for people who reach state pension age on or after April 6, is intended to be easier to understand, so people will know from a much younger age how much they are likely to get.
But two-thirds (67%) of the nearly 4,000 working age people surveyed were unable to correctly identify that the full rate for the new state pension will be £155.65 a week, retirement firm Aegon UK found.
One-third (34%) of people surveyed wrongly thought the payments would be higher, and upon learning the actual figure, nearly two-fifths (37%) now plan to put more into their private pension to pay for their retirement.
Some 38% of people in the survey carried out between February and March have no idea whether they will qualify for the full state pension or not. To get any state pension, people will usually need at least 10 qualifying years on their National Insurance records.
More than half (53%) of people think the Government should provider clearer information on how much state pension they personally are set to receive.
Aegon also said there is a "fundamental misunderstanding" about how the state pension is funded.
Some 57% of people think their NI contributions are saved into a fund which pays their state pension in retirement. Aegon said in reality, state pension payments are paid by the NI contributions and income tax payments of those currently in work, meaning future pension payments rely on future generations.
Women were particularly confused about how they will be affected, the research found.
Nearly a quarter (24%) of working-age women were unaware of the rising state pension age for women to bring it into line with that for men.
Steven Cameron, pensions director at Aegon UK said: "With just a number of days before the new flat rate state pension comes into force, it's alarming that so many people don't know how much they're due to receive, or when they're supposed to start receiving their weekly payments.
"The landmark changes to equalise state pension age, and the introduction of the new flat rate, appear to have been lost in translation and the sheer lack of awareness is shocking.
"The Government must now act quickly to ensure that individuals know how much they personally are due to receive and when."