Only a third (33%) of UK adults feel the pensions system works well for people like them, suggesting there is a need for automatic enrolment reform, says Standard Life.
According to research carried out by the Standard Life Centre for the Future of Retirement, millions of people could have better retirement prospects if the system was improved. While auto-enrolment has transformed pension participation in the UK, many people are still saving at levels unlikely to deliver the retirement they expect, with lower earners, self-employed workers and women most likely to feel the current system is not working for them.
The 2026 Standard Life Retirement Voice report shows two fifths (42%) of people yet to retire expect their standard of living to worsen in retirement, increasing from a third (33%) in 2024.
Furthermore, almost two thirds (63%) of people are worried they are not saving enough for retirement and almost half (45%) expect their standard of living in retirement to be worse than their parents.
Confidence is weakest among lower earners, with just 24% of this cohort agreeing the pensions system works well for people like them, compared to 40% of those earning above £20,000. Confidence is similarly low among the self-employed, at 24% compared to 35% of employees, while only 28% of women are confident in the system, compared to 39% of men.
Catherine Foot, director of the Standard Life Centre for the Future of Retirement, said: “Auto-enrolment has been one of the great pension policy successes of recent decades, but the challenge now is whether it enables people to save enough, early enough, and in a way that reflects different employment patterns and income levels.
“Lower starting ages, contributions from the first pound earned and support for those currently outside or on the edges of automatic enrolment could make a meaningful difference, particularly for lower-paid workers and people with multiple jobs.”
Standard Life’s own modelling suggests that if contributions were calculated from the first pound earned, a lower earner could be around £30,000 better off in retirement.
However, Foot said reform must be carefully designed.
“The timing, sequencing and sharing of any future increases in contributions matter, particularly given the impact on employers and lower earners’ take-home pay. The Commission’s recommendations should therefore set out a clear and gradual path for change, while also considering how the system can evolve to better support self-employed workers, who face a different challenge because they do not benefit from automatic enrolment.”
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