More than a third of employees fear they may never be able to retire 

More than a third of UK employees fear they may never be able to afford to retire, as rising living costs continue to put pressure on long-term savings.  

According to new research from financial wellbeing and retirement specialist, WEALTH at work, 38 per cent of employees with a defined contribution pension are concerned they will never be able to retire because of the impact of higher living costs on their ability to save. 

The study of 2,000 UK workers highlights growing concerns about retirement adequacy, with 83 per cent saying rising living costs will leave them less comfortable in retirement due to a shortfall in pension savings. Meanwhile, 82 per cent believe they may need to work longer to make up for gaps in their retirement income. 

The findings suggest many employees are struggling to balance immediate financial pressures with longer-term financial security. 

When asked about workplace pension contributions, 41 per cent said they were saving at, or below, the minimum eight per cent auto-enrolment level. Just 20 per cent reported contributing 12 per cent or more, the level recommended by the Living Pension benchmark for a minimum standard of retirement living. 

A further 10 per cent said they did not know how much was being contributed to their pension at all. 

Despite these figures, almost half (45 per cent) believe they are saving enough for retirement, highlighting a potential gap between perception and retirement readiness. 

The research also points to a significant opportunity for employers to support workforce financial wellbeing. One in four employees said they would like support to understand how to increase pension contributions, while 30 per cent said they plan to increase contributions in the future. 

However, a third (33 per cent) said they cannot currently afford to save more because of financial pressures. 

Jonathan Watts-Lay, Director at WEALTH at work, said: “Many people are understandably worried about whether they’ll ever be able to afford to retire. When meeting day-to-day living costs become difficult, it’s often long-term savings that take a back seat. But even small changes early on can make a huge difference over time, particularly when combined with employer contributions and investment growth. 

“One of the problems is that pensions can feel complex and distant, making it easy for people to disengage. That’s why ongoing support throughout someone’s working life is so important. The earlier individuals engage with their finances, the more options they’re likely to have later on. Workplace financial education plays a critical role, giving people the knowledge and confidence to make informed decisions early and consistently.” 

The findings come as financial wellbeing continues to rise up the workplace health agenda, with employers increasingly recognising the impact financial stress can have on employee wellbeing, productivity and long-term workforce participation. 

The research was conducted by Opinion Matters between 29 May and 3 June 2026 among 2,000 UK employees aged 18 and over who have a defined contribution workplace pension. 

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