Two million self-employed have no pension savings - Prudential
Two-in-five self-employed workers do not have a pension and more than half want the law changed to encourage them to save for retirement, according to research from Prudential.
Two-in-five self-employed workers do not have a pension and more than half want the law changed to encourage them to save for retirement, according to research from Prudential.
The life company said two-fifths of self-employed workers - the equivalent of two million people - have admitted to having no form of pension and more than one-quarter said they will be reliant on the state pension as their main source of retirement income, which is currently worth just £8,546 a year.
According to Prudential's study of 1,178, conducted by independent researchers Consumer Intelligence, one-quarter (27%) of those questioned would support the expansion of auto-enrolment to cover the self-employed while the same amount (27%) would back compulsory pensions saving.
Prudential retirement expert Vince Smith-Hughes said: "It is clear that the self-employed want help in saving for retirement and that the state pension alone may not be enough for a comfortable retirement.
"Various options to encourage and support the self-employed to save via auto-enrolment have been put forward in recent years."
Govt continues to exclude self-employed from pensions, experts warn
The study highlighted the growing pension crisis among the self-employed, with nearly one-in-five saying they do not believe pensions apply to them. According to Prudential, the same amount of self-employed people also said they find the rules very confusing.
One-in-seven (15%) worry they will not be able to immediately access their pension funds if they are out of work.
Smith-Hughes added: "We believe it is important that the government works with the self-employed to ascertain the most suitable option and put appropriate rules in place as soon as practicable."
The Pensions Advisory Service chief executive Michelle Cracknell said its work echoes the findings, arguing the self-employed want help in saving for retirement but that there is a "clear disconnect between the self-employed and pensions".
She explained that, currently, they are not getting the help they need: "The self-employed are a diverse group who have many different needs and desires and we must find new ways of getting the key message of importance of retirement savings across to them and, importantly, new mediums to deliver those messages."
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