Confused about retirement savings? 7 popular pension myths busted

The minimum amounts that can be put into workplace pensions will be stepped up from April, as UK savers are encouraged to put aside more for their retirement.

Under automatic enrolment rules, from April 6, the minimum that can be put in by employers and their staff will increase from 5% of qualifying earnings to 8%. Within the new 8% rate, at least 3% must be paid by the employer, with the remaining 5% made up by staff.

Automatic enrolment started in autumn 2012, amid concerns people were living for longer but not saving enough for their later years. "Automatic enrolment is approaching its seventh birthday. In its short life, it has already brought a quiet revolution to pensions in the UK," says Alistair McQueen, head of savings and retirement at Aviva.

Pensions are not always easy to understand, though, and there's still a lot of confusion around them for lots of people. Do you feel unsure of the facts? Here, McQueen busts seven pensions myths...

Myth 1: No one is saving into a pension

Automatic enrolment has introduced more than 10 million new savers to workplace pensions since 2012. There are now a total of 22 million people participating in workplace pensions in the UK.

Myth 2: Pensions are for old people

Contrary to popular perception, it is the under-30s who are leading the way. All ages have seen an increase in workplace pension participation since 2012, but the under-30s have seen the biggest increase – more than doubling from 35% saving to over 79% by 2018.

Myth 3: The government will pay for all my retirement

It's true that we can expect some money in retirement from the state, but this is currently up to a maximum of about £8,500 every year. Today, the majority of the typical retirees' income in retirement is from sources beyond the state, such as private pensions and other savings.

Myth 4: I will receive my state pension from age 60 if I'm a woman, or 65 if I'm a man

These commonly referred to and long-standing ages were set decades ago, when we could generally expect a few short years in retirement. Since then, average life expectancy has greatly increased, and the age at which we are eligible for our state pension has been increasing, with women starting to qualify for their state pension at the same age as men.

The state pension age is set to keep rising too. The yourpension.gov.uk website can help you check your state pension age.

Myth 5: I can't retire until I reach my state pension age

We are free to retire whenever we want to. However, we can only really think about retiring when we feel we have saved enough money to meet our needs when we're not working. New rules allow people to access private pensions from age 55 – but the state pension age is set by government.

As individuals, we have the freedom to choose our retirement age, but this brings with it a responsibility to ensure we can fund our lifestyle from that point onward. There are many free online resources to help make this decision – such as Aviva's 'My retirement planner'.

Myth 6: I'm the only one who is confused by pensions

Research suggests only a minority of us feel we really understand pensions. So, if you're feeling a bit uncertain, you're not alone. The great news is that more of us are saving for our future. And if you're looking for a little nudge in the right direction, Aviva suggests three general rules of thumb that could help you be better prepared:

1. Save at least 12.5% of earnings towards your retirement. This can include money from your employer and the taxman.

2. If possible, start saving at least 40 years before your target retirement age.

3. Try to have built up at least 10 times your salary in your pension by the time you retire.

Myth 7: Retirement is further away than ever

There's still a collapse in workplace participation as we progress through our 50s. This represents a huge waste of talent, experience and potential. One of the strongest levers we can pull to help fund our lives in retirement is to work longer. Many employers are taking fresh steps to support a fuller working life, with the aim of ensuring that age is no barrier to opportunity.