This research suggests that in 2016 there will be more over 50s dependent on defined contribution (DC) pensions than on defined benefit (DB) pensions.
The shift from DB to DC means a shift in responsibility and control from your employer to you.
With DC pensions much of the responsibility and indeed risk, for building up a pension suitable to your needs and circumstances lies with each of us.
And the decisions we need to make in regard to our DC pensions need to happen from the start and every year thereafter including at retirement and indeed for the years in retirement.
The size of our DC pension will depend on several things:
- The contributions we make
- The contributions our employer makes
- The number of years over which contributions are made
- When we start taking our pension/ retire
- How our pension is invested
- How that investment performs
Those shown in bold are things we have control over and on which we should be making informed decisions and regularly reviewing.
With such responsibility it is important to seek guidance and advice to ensure you are making the most of your DC pension.
A new landmark will be reached this year when workers approaching retirement will become more reliant on "defined contribution" pensions than final salary schemes, a study will predict this week. The proportion of those aged over 50 who are expecting a final salary scheme to pay for their retirement has fallen to just 34pc and will be overtaken in coming months by those expecting to take income from less generous defined contribution (DC) schemes, at 32pc.