Why Millions of UK Employees Are Worried About Retirement and What Employers Can Do About It
Most people know, somewhere in the back of their minds, that they probably aren’t saving enough for retirement. What’s surprising is just how many of them are right to worry.
New research from Barnett Waddingham, covered by Actuarial Post, Corporate Adviser, and Employee Benefits, found that 32% of UK workers don’t feel confident they’ll retire with a comfortable income. That’s not a small or marginal group. It’s roughly one in three of the people sitting in any given office, warehouse, or meeting room.
And the numbers are getting worse, not better.
The Figures That Should Worry HR Teams
Among workers aged 45 to 54, nearly half (48%) lack confidence in their retirement prospects. The same research a year earlier put that figure at 42%. Among those aged 55 and over, it’s risen from 37% to 40%. People are getting closer to retirement and feeling less prepared, not more.
Perhaps the most telling statistic is the collapse in retirement planning altogether. In 2024, 13% of workers had set no retirement goals whatsoever. By 2025, that figure had risen to 28%. More than doubling in a single year isn’t a blip. Something has gone wrong with how people are engaging with their financial futures, and it isn’t getting fixed on its own.
Seventeen per cent of those expecting to retire within the next decade have no financial targets in place at all. These aren’t people with decades to course correct.
Women Are Significantly More Worried
The research identifies a gender gap that tends to get overlooked in broader conversations about pension adequacy. Around 27% of men express concerns about their retirement income. Among women that rises to 42%. Women are also less likely to have formal financial goals in place.
For employers thinking seriously about communicating workplace pensions to employees, this matters. Generic, undifferentiated pension communications are unlikely to land equally well across a workforce with very different levels of confidence and engagement. Targeted support for female employees in particular could make a real difference, and it’s an area most organisations haven’t yet addressed properly.
Worry Isn’t the Same as Action
Here’s the part that really stands out. Most people are worried, but almost none of them are doing anything about it.
Over half of employees (58%) are concerned about losing track of their pension pots or not knowing what their savings are worth. Yet 19% have never once logged in to check their pension value. Not once.
Even more striking: over a quarter (27%) of workers planning to retire within a year have still never looked at their pension online. This isn’t a story about younger workers who feel retirement is too distant to think about. It’s a story about disengagement that runs all the way to the point of leaving work.
What This Means for Employers
Employer Pension Duties Don’t Stop at Enrolment
Auto-enrolment has done what it was designed to do. It has brought millions of people into pension saving who would otherwise have opted out or never joined at all. But it was never meant to be the whole answer, and the research suggests quite clearly that it isn’t.
Employer pension duties go beyond getting staff enrolled. The Pensions Regulator expects employers to maintain accurate records, assess staff correctly, handle opt-outs and opt-ins properly, and communicate clearly with employees about their pension rights. For many smaller organisations in particular, it’s worth taking the time to check that all of this is actually happening, not just assumed to be.
Paying Pension Contributions on Time
One of the most fundamental and most commonly breached obligations is paying pension contributions on time. Late payments are one of the most frequent compliance failures The Pensions Regulator encounters. They can leave employees worse off, particularly those who are closer to retirement and have less time to absorb the impact of a shortfall.
Getting this right requires robust payroll processes and clear lines of responsibility. It sounds basic because it is, but it’s worth auditing regularly rather than assuming it’s being handled correctly.
Pension Contributions UK: Is the Minimum Actually Enough?
The current minimum for pension contributions UK law requires is a combined 8% of qualifying earnings, with employers contributing at least 3%. That’s the floor, not a target.
Most financial planning experts consider the minimum contribution insufficient for workers hoping to maintain anything like their current standard of living in retirement. Employers aren’t obliged to contribute more than the minimum, but those who do, and who communicate that fact clearly, tend to find it’s valued. It’s also worth helping employees understand the role of tax relief and employer matching, because many simply don’t know how these work or what difference they make over time.
Communicating Workplace Pensions to Employees
Communicating workplace pensions to employees is harder than it sounds. Pension language tends to be technical, the subject feels abstract when retirement is years away, and most people’s instinct is to put it off. That’s not a character flaw. It’s just how people are wired when it comes to decisions with consequences that feel distant.
Effective pension communication in the workplace tends to share a few common characteristics. It uses plain language rather than assuming financial literacy that most people don’t have. It speaks to employees’ real concerns, chiefly whether they’ll have enough money to live on, rather than leading with scheme mechanics. It reaches people at different stages of their careers with different messages, because the conversation with a 28 year old and a 52 year old shouldn’t be the same one. And it happens regularly, not just once a year when a pension statement lands.
Research from Barnett Waddingham suggests that many employees are unaware of support tools their pension scheme already offers, including online projection tools and guidance resources. Getting employees to actually use what they’re already paying for would be a reasonable place to start.
Pension Governance Basics
Sound pension governance basics matter because everything else depends on them. Employers need to know their duties as scheme sponsors, keep accurate records, work constructively with their pension provider or trustees, and make sure their auto-enrolment processes are running correctly, including re-enrolment obligations every three years.
For employers who are less familiar with this area, The Pensions Regulator’s employer hub sets out the key obligations clearly. It’s not designed to be intimidating, and working through it is a reasonable starting point for any organisation that wants to make sure its foundations are solid before worrying about what to build on top of them.
Financial Wellbeing Education Is Part of the Answer
Clear, accessible financial education helps employees move from knowing vaguely that pensions exist to actually understanding what their pension means for them. That includes how workplace pensions work, how contributions grow over time through compound returns, how tax relief increases the value of what they’re saving, and what they should actually be checking when they log into their pension account.
For organisations willing to invest in this properly, the benefits go beyond pension outcomes. There’s decent evidence that financial stress affects performance, absence, and retention. Employees who feel more confident about their financial futures tend to be more engaged at work. The case for taking financial wellbeing seriously has never been stronger, and the research suggests the need has rarely been greater.
The Bottom Line
Retirement anxiety is widespread, growing, and not being addressed by leaving employees to figure things out alone. The gap between having a pension and understanding it is where most of the problem lives.
Employers and HR teams are in a position to close that gap in ways that employees, acting on their own, mostly aren’t. That starts with getting pension governance basics right, being serious about communicating workplace pensions to employees, and making sure that the education and support on offer is actually accessible to the people who need it most.
The data suggests that’s a large proportion of the workforce. Getting this right matters.
Sources: Actuarial Post | Corporate Adviser | Employee Benefits