Nearly a quarter (24%) of Brits have ‘no idea’ how much they’ve saved into their pension while almost half (42%) admit confusion over how much they need to save for retirement, according to new research from PensionBee.
In response to these challenges, pension savers are calling for increased support from the government, with over 80% of Brits backing the creation of clear saving benchmarks to hit by set milestones to aid with their retirement planning.
As Pension Awareness Week shines a spotlight on the state of UK retirement savings, new analysis highlights a sobering gap between current pension savings and the amount estimated to be required for a moderate lifestyle in retirement.
According to ONS data, the average pension pot for a 30-year old saver in the UK is just £7,000, falling short of the estimated £44,000 that would be needed at this age to be on track for a moderate retirement living standard.1 Even by age 50, average pension savings stand at £75,100, still significantly below the estimated £187,000 needed by this age to be on track for the same lifestyle. This shortfall is compounded by many Brits overspending in retirement, with 1 in 5 over-55s reporting consistently spending more than expected.2
Becky O’Connor, Director of Public Affairs at PensionBee, commented: “Millions of Brits are at risk of falling short of the retirement they hope for, simply because they don’t know how much they should be saving or when.
As people live longer, the need for clear guidance on retirement savings has never been greater. Savers are crying out for more support. Both the pensions industry and the government must play their part in providing clarity to enable people to confidently plan for their later years.”
Table 1: Do you know how much you have in your pension?
Source: PensionBee, September 2024. Responses from a nationally representative sample of 2,000 UK adults aged 18-66. Numbers have been rounded.
Table 2: Do you have a target amount you’d like to have in your pension by retirement age?
Source: PensionBee, September 2024. Responses from a nationally representative sample of 2,000 UK adults aged 18-66. Numbers have been rounded.
Table 3: Do you have a target amount you’d like to have in your pension by retirement age? (By gender)
Source: PensionBee, September 2024. Responses from a nationally representative sample of 2,000 UK adults aged 18-66. Numbers have been rounded.
Table 4: The estimated gap between current UK pension savings and the target amount for a moderate lifestyle, by age
Source: PensionBee ,*ONS Saving for Retirement in Great Britain June 2022 **PLSA Retirement Living Standards estimated range of £300,000 to £500,000 midpoint
Table 5: How does your current retirement spending compare to what you initially expected?
Source: PensionBee, August 2024. Responses from a nationally representative sample of 1,000 UK adults aged 55-85. Numbers have been rounded.
Table 6: Would you find it helpful to have a clear benchmark from the government on what savings to target by set milestones?
Source: PensionBee, September 2024. Responses from a nationally representative sample of 2,000 UK adults aged 18-66. Numbers have been rounded.
Footnotes
- PensionBee ,*ONS Saving for Retirement in Great Britain June 2022 **PLSA Retirement Living Standards estimated range of £300,000 to £500,000 midpoint.
- PensionBee.
