XPS Group has launched the ‘DC:UK Savings Watch’, a tracker that benchmarks a typical DC pension pot at retirement against the PLSA/Loughborough University Retirement Living Standards.
According to recent reports, the government has halted the second part of its pension review, which raises questions about how adequate DC pensions are given that many members are unlikely to reach their savings targets.
The DC:UK Savings Watch, updated daily, accounts for inflation and market swings to measure changes in the average member’s DC pension pool.
It evaluates how closely a member’s pension meets important retirement criteria using data from the PLSA, Loughborough University, MoneyHelper, the UK Government, and the London Stock Exchange Group, offering employers and trustees important information about pension adequacy.
XPS Group head of DC investment Mark Searle says: “The second phase of the pension review was a real opportunity to put in place long term plans to improve retirement prospects for generations to come. Recent press speculation has indicated that this has been put on hold. It’s disappointing that the government are no longer prioritising the adequacy problem, so the solution necessarily lies with trustees, employers and individuals themselves.
“XPS DC:UK Savings Watch not only models a typical DC pension pot, it can also model scheme specific data to help employers and trustees understand the savings targets their members need for a secure retirement. By aligning projected pension pot values with recognised industry living standards, we aim to empower employers and trustees to support their members and provide clearer insights on retirement adequacy.
“We know the importance of planning for a future that aligns with financial goals, so we’re excited to launch XPS DC:UK Savings Watch as a practical way to help employers and trustees identify the gap between retirement aspirations and realities. Early intervention through changes to the investment strategy and / or contribution levels can then be discussed to move members to a more secure retirement.”