Almost half of all UK workers do not know about Government tax incentives for pension saving, according to B&CE Benefit Schemes.
Research by B&CE found around one in five consumers save for their retirement via alternative means.
Workers are often using property or ISAs for their retirement income, but 28% are using normal deposit savings accounts.
Property is one of the most popular ways to save for retirement, with 44% choosing this form of investment. Many believe they will have greater control over this type of investment, the research revealed.
ISAs are also popular as they do not pay tax on interest, but two thirds of ISA savers also contribute to a pension scheme as well, while 30% of pension contributors also have an ISA.
Worryingly, the report also found many people believe interest is tax-free on deposit savings, around 31%, despite this being untrue.
John Jory, deputy chief executive of B&CE, says: “The findings of the research present a worrying picture of retirement saving today. There is a lack of awareness about the benefits of pension saving, which may mean that people are making ill-informed decisions.”
B&CE says workers need greater education on the benefits of traditional pension savings, and wants the industry to make more innovations to allow workers to control their pension investments.
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