Employer pension contributions can vary massively across different industries and different companies. A really generous, good employer pension contribution could be as much as 20% of your annual salary. But on average, you could expect between 7% – 14% contribution from your employer in the private sector. Some employers, particularly larger corporations, might offer very high pension contributions as a generous employee benefit. In contrast, small businesses may only offer the minimum mandatory contribution.
It’s important to consider whether the employer pension contribution at your current job (or prospective job) is in line with your goals for the future. For example, there is evidence to suggest that the average millennial will need £1,000,000 in their pension pot to retire comfortably at age 65. One million pounds sounds astronomical. But it’s important to remember that inflation rates will only increase over the course of your lifetime. It’s a good idea to get your pension sorted from the start of your working life.
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