Pension savers 'left in the dark' as majority do not know what state pension triple lock is

Some 65 per cent of British adults aged 40 and above were unable to identify the definition of the triple lock.

This is the metric used to determine the annual payment hike for the state pension with benefits increasing by either the rate of inflation, average earnings or 2.5 per cent; whichever is higher.

When given four options, 39 per cent of potential pension savers picked the incorrect definition of the three factors that are included as part of the triple lock.

Only 26 per cent of survey respondents admitted that they did not know anything about the state pension triple lock.

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When asked, 51 per cent of over 40s described the UK’s pension system as being "too complicated".

Furthermore, 50 per cent of middle aged Britons do not believe the Government provides proper education and support to understand retirement policy.

As well as this, 62 per cent of over 40s admitted that they find pension planning daunting.

More than two-thirds of those polled said Government needs to do more to improve people’s access to financial guidance and advice.

On the research, Lily Megson, policy director at My Pension Expert, said: “Preparing for retirement is rarely as straightforward as we’d all like it to be.

"Sadly, the complexity of our pensions system exacerbates the issue, with changing policies, excessive jargon and insufficient government support leaving savers in the dark as they prepare for the future.

“That so few over-40s know precisely what the triple lock is ought to be a wake-up call to MPs. We need a shift towards greater consistency and clarity when it comes to pension policy – something that would help people plan effectively.

"This must then be supported through better access to financial education, guidance and advice for everyone.

“Political parties should work more constructively together to deliver genuine cross-party collaboration on boosting financial literacy.

"Everyone should have access to the right tools to manage their finances and effectively prepare to achieve the retirement they deserve.”

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Ahead of the General Election on July 4, both Labour and the Conservatives have pledged to keep the state pension triple lock despite concerns over its cost.

Notably, the Tories confirmed plans to introduce a "triple lock plus" which would see the tax-free allowance on pensions rise every year/

This is in response to the backlash to the freeze on personal allowances which has resulted in taxpayers being dragged into higher tax brackets. This is referred to as fiscal drag and occurs when tax thresholds remain at the same level while incomes rise.

Despite this proposal being heavily promoted by Prime Minster Rishi Sunak's Government, Labour have confirmed it will not be introducing the "triple lock plus" if it returns to power.