Report: The DC Future Book

Setting out the available data on the defined contribution (DC) pension landscape, this report from the Pensions Policy Institute (PPI) provides commentary, analysis and projections of future trends.

Key findings

  • Factors which are likely to lead to changes in the future include: automatic enrolment, the private sector move from defined benefit to DC schemes, the use of new pension flexibilities and changes to the way that advice and guidance are used and delivered.
  • Using PPI modelling to explore how the DC landscape might look like in future, the report suggests that by 2038 there could be around 7.8 million people actively saving in master trust schemes.
  • Median DC pension pots could grow from around £27,000 to around £59,000 over 20 years.
  • Future employee and employer behaviour, and government policy, will all affect the aggregate value of DC assets and the value of a member’s pot at retirement.
  • Future pensioners may struggle to meet their needs in the current environment. The report found that over the next few decades pensioners are likely to have lower incomes and higher consumption needs.

The DC Future Book is published in association with Columbia Threadneedle Investments.