Why retirement confidence starts with financial education

New research from workplace financial wellbeing specialist WEALTH at work has found that more than a third of UK employees with a defined contribution pension fear they will never be able to afford to retire. It is a striking figure, and one that will not surprise anyone who has tried to balance the cost of living today with saving for a retirement that feels decades away.

The study surveyed 2,000 UK employees. Some 83% said rising living costs will leave them less comfortable in retirement, up from 81% the previous year. Around 82% are concerned they will need to work longer to make up for a shortfall in pension savings. These are not fringe anxieties. They reflect something most working people are quietly carrying.

Most employees are not saving enough — and many do not know it

The contribution figures make difficult reading. When asked about total workplace pension contributions (covering both employee and employer payments), 41% of employees said they are saving at or below the 8% auto-enrolment minimum. A further 29% are contributing between 9% and 11%. Only 20% are saving at 12% or more, which is the level recommended by the Living Pension benchmark for a minimum standard of retirement living.

Perhaps the most revealing finding is that 10% of employees do not know how much is being paid into their pension at all. And despite the widespread shortfalls, 45% believe they are already saving enough. There is a significant gap between what people think is happening and what is actually happening.

Financial pressures are the main reason people are not saving more. A third of employees say they simply cannot afford to increase contributions right now. But 30% plan to do so in the future, and 25% say they would welcome support on how to go about it. That appetite for guidance is worth paying attention to.

Pension anxiety does not stay at the door

For employers, it is tempting to treat pension statistics as a personal finance matter, something that sits outside the scope of an HR strategy. But financial stress has a well-documented effect on concentration, attendance and morale. When people are worried about money, that worry comes to work with them.

Employers cannot control inflation or the broader economic conditions that are making retirement feel out of reach for so many people. What they can do is help employees understand the decisions available to them and give them the confidence to act. That is not a small thing.

Why pensions feel so difficult to engage with

The core problem is that pensions are genuinely hard to understand, and most people receive very little education about them. Employees may not know how their contributions are invested, what employer matching means in practice, how tax relief works, or what the difference is between staying invested and moving into lower-risk funds as they approach retirement. When something feels opaque and distant, the easiest response is to ignore it.

Short, accessible learning that explains these things in plain English can change that. As Jonathan Watts-Lay, Director at WEALTH at work, put it: “Even small changes early on can make a huge difference over time, particularly when combined with employer contributions and investment growth.”

Financial education works best when it covers more than pensions

Pension saving does not happen in isolation. Someone who is struggling with debt, has no emergency fund, or has never thought about budgeting is unlikely to increase their pension contributions, however clearly the benefits are explained. Financial wellbeing education is most useful when it addresses the full picture — day-to-day money management, savings habits, understanding inflation, and how to make the most of workplace benefits.

It is also worth recognising that the right content varies depending on where someone is in their career. A 25-year-old needs to understand why starting early matters and how compounding works in their favour. Someone in their forties needs to think about whether they are on track and what adjusting their contributions could mean for their projected income in retirement. Someone closer to the end of their working life needs to understand their options at the point of access, including the difference between annuities and drawdown.

A one-size-fits-all approach rarely works. Ongoing access to relevant, well-written resources does.

What good financial wellbeing support looks like

The Money and Pensions Service and MoneyHelper offer free, impartial guidance that employers can signpost employees towards. These are useful starting points, but they work best alongside something more structured.

Good workplace financial education gives employees a working understanding of their pension statement, the value of increasing contributions over time, how employer matching works, and what their options look like at retirement. It also gives people somewhere to go when circumstances change: a job move, a redundancy, a new mortgage, a divorce. Financial education is not a one-off exercise. People’s situations evolve, and access to reliable information needs to evolve with them.

For HR teams, digital learning has a practical advantage here. Online modules that employees can complete at their own pace remove the logistical burden of coordinating face-to-face sessions and ensure that everyone receives the same accurate information regardless of where they work. That consistency matters, particularly for organisations with hybrid or multi-site workforces.

Supporting your employees with Aspina

Aspina’s financial wellbeing e-learning platform is designed to help employers deliver this kind of education without the overhead. Modules cover workplace pensions, retirement planning, budgeting, savings, investing basics, and wider financial wellbeing topics. They are short, straightforward, and built to be completed around busy working lives.

If you would like to find out more about how Aspina can support your financial wellbeing strategy, get in touch.