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Personal pension savings fall in 2016/17

Average contributions to personal pensions have fallen by about a third in 5 years on from the introduction of workplace pensions, prompting calls to improve the auto-enrolment system.

According to the Office for National Statistics, average annual contribution rates to personal pensions fell from £3,690 in 2011/12 to £2,400 2016/17.

The majority of individuals in the study were employees, who contributed an average of £2,310 a year in 2016/17.

Mutual insurer Royal London warned that employees who stick to minimum auto-enrolment contributions could risk not having enough savings in retirement, and said the government should look at increasing the minimum rates.

Meanwhile, self-employed individuals made higher contributions on average at £4,490 in 2016/17, but this figure had fallen from £5,310 in the previous year.

Helen Morrissey, pensions specialist at Royal London, said:

"We would urge government to do all it can to help self-employed people build a sustainable pension by bringing [the self-employed] into the auto-enrolment space without delay."

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