Getting a clearer picture of your pension pots could become easier next year, with Government plans to introduce simpler annual statements.
New regulations are due to be outlined this week, requiring pension schemes to provide their members with two-page documents.
These new simpler pension statements will highlight, in simple terms, the critical information about the pension, including the amount saved in the workplace pension pot and a retirement income forecast.
The final rules will be known following consultation and then come into effect next April.
Simpler workplace pension statements form part of a Government commitment to encourage people to save more for retirement by making sure they can readily see the important information about their money.
An initial focus for these simpler pension statements will be workplace pensions but could include all pension schemes in the future.
Guy Opperman, Minister for Pensions, said:
“It’s clear the status quo is not working, with savers left puzzled by the complex, sprawling, jargon-filled statements commonly used by the pensions industry.
“Simpler statements will set a new standard for how pension companies communicate with their members.
“With more people saving for their retirement than ever before thanks to the success of Automatic Enrolment, it’s vital they can understand what’s going on with their hard earned money and actively plan for their future.”
The new statements will present several key pieces of information, in easy to understand language.
They will show how much money the saver has in their pension and what has been saved during the statement year.
The statements will also show how much money you could have when you retire and steps you could take to save more money for retirement.
Simpler pension statements are part of a project to introduce a pension dashboard, showing data about all pension pots, including the State Pension, in one online location.