The firm polled 380 adults with workplace pensions, of which one fifth identified as millennials. The findings show the stark difference between the behaviours and attitudes of millennials compared to the wider workforce.
Almost a quarter (23%) of the 18-34 year olds who took part did not know how much their employer was contributing to their pension. This compared with 21% of all respondents who were unaware of how much their employer was paying in, despite 97% being aware their employer was contributing.
From the millennials that took part in the survey, 41% said they were not aware they get tax relief on workplace pension contributions, compared to 22% of all people polled.
Almost half (49%) of people with workplace pensions said they paid 5% or more into their workplace pension, but this fell to just 29% among millennials.
However, 68% of millennials said it is very important for pensions to be a priority, and 27% said it is quite important. Meanwhile, among all participants polled, three quarters said it is very important to prioritise pension savings, compared with 22% who said it is quite important.
For millennials, saving for a property or a rainy day was at equal importance, at 48%, followed by 45% who said they prioritise saving for retirement.
The top savings priority among the total number of participants differed, with 71% saying that saving for retirement was a priority.
This was followed by just under half (49%) of all respondents who said saving for a rainy day was a priority, and 30% who said they would put saving for a specific goal, such as a holiday or a car first.
Aegon head of pensions Kate Smith said while auto-enrolment gets people out of the starting blocks, it is only a small part of the solution for saving for retirement.
She commented:"As the main route for employees to save for retirement, the workplace is the perfect place to encourage employees to engage with pensions.
"We'd like to see more schemes ensuring employers are encouraging and engaging their younger employees to get into the habit of saving through their workplace pension.
She added that as millennial savings are spread so thinly, it is important this cohort saves enough for retirement to maximise pension contributions from their employer.
"This will give them a better chance to stay on track, to achieve their retirement aspirations," Smith added.
Millennials choose investment funds
Interestingly, the survey suggested that millennials are more likely than the wider adult pool to choose their own funds rather than remain in the default fund. Some 65% of millennials opted for the default fund, compared to 72% of the total respondents.
Some 30% of millennials said they picked their own investment funds, compared to just 20% of 35- to 44-year-olds, 15% of 45- to 54-year-olds, and under a quarter (23%) of 55- to 64-year-olds.
Smith further pointed out that millennials choosing investment funds is a promising sign the younger generation are getting more involved in retirement planning. Smith added:"The onset of pension digitisation might have made this more appealing to a more tech savvy generation. We hope for this trend to continue for generations to come."
How much are members contributing to their pension?
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