The Government is being urged to encourage development of pension schemes which automatically increase future employee contributions above the automatic enrolment minimum.
Standard Life has advocated “save more tomorrow” schemes as an extension to auto-enrolment. A person commits to putting more money into their pension as their wages increase.
In a panel debate at the ABI pensions conference, ABI assistant director of life and savings Yvonne Braun said: “Auto-enrolment does not address how to get people to save above the minimum. There is a risk people will be lulled into a false sense of security and will think their retirement is sorted. Save more tomorrow could benefit millions. We are very keen to take this forward with the Government.”
FSA pensions and investment manager Milton Cartwright said paid-for advice will have a limited role in auto-enrolment for lower earners.