How to help your employees set retirement goals they'll actually keep

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We all know saving for retirement is important. But how much should your employees be aiming to save? Setting a goal can help to keep your employees on track for the retirement they want and set them up for success in later life. Here are four simple steps to help your employees get started.

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1. Get a starting point

The first step is for your employees to check how much is in their pension pots. This will tell them where they’re starting from and how much they have saved already.
 
If they have several pension pots – which is pretty likely if they’ve had a few jobs – then they might want to consider bringing them together into one plan. This could make it easier for them to manage, as well as give them a clearer idea of what their future income could look like.

This won't be right for everyone, though. Employees could lose money by giving up any guarantees or benefits they might get from other pension plans, so it’s important that they check this first.

If your employees already have a Standard Life workplace pension plan, they can easily transfer their old pensions into their plan online. Take a look at our employee pension transfer hub for resources to help your employees decide if transferring is right for them.

2. Get an idea of how much retirement will cost

Next, it’s a good idea for employees to work out how much they’ll need to pay for the lifestyle they want in retirement. 

Standard Life workplace pension scheme members can use our Retirement Income Tool to find out. This uses data from the Retirement Living Standards to show if they’re on track for a minimum, moderate or comfortable lifestyle in retirement. 

3. Decide what age to retire

The next step is for employees to work out how many years they’ll need to fund, based on when they want to retire. 

They’ll need to keep in mind the earliest they can access their pension, which is age 55 (57 from 6 April 2028). And with many people living longer these days, employees may need at least a few decades’ worth of income.

The State Pension also won’t kick in until employees reach their late 60s. So, if they plan to retire before State Pension age, they’ll need to be prepared to rely solely on their savings for a while.

4. Be realistic

At this stage, your employees will now have a figure to aim for. The next step is for them to work out how they’re going to reach it.

Although it’s good to be ambitious, it’s also important for them to be realistic and not set goals that are unachievable. 

Employees who still have a lot of years ahead of them to save for retirement are in a stronger position. They’ve got a long time to build up their pension savings, so even starting to regularly pay in a small amount now could make a big difference by the time they retire.

For others, retirement could be just around the corner. Employees in this position might want to be a little more aggressive with the amount they pay in. 

Our Money Mindset app, available to Standard Life workplace pension scheme members, includes a budget planner that can help employees see how much they could put away for the future, based on what they’re spending today.

Time to set a goal

Your employees should now have all the information they need to start setting their goals.

Based on what they’ve planned, employees might want to regularly review if they’re on track, and change their pension payments if needed. 

Standard Life workplace pension scheme members can easily check and change their pension payments online or using our app. Plus, they can get access to tips and tools via Money Mindset to help them make more confident decisions about their money – and feel ready for the future.

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