Despite widespread concerns about retirement affordability, many UK workers are failing to actively engage with their pension savings, according to new research[1] from financial wellbeing and retirement specialist WEALTH at work.

The research, conducted with 2,000 UK workers with a defined contribution pension, found that one in five (20%) employees have taken no action on their pension in the past 12 months. The figure rises to over a quarter (26%) among those aged 44 to 54, a group moving closer to retirement, where engagement becomes increasingly critical to ensure they are on track. Notably, 14%[2] of employees say they never review their pension.

This is despite over a third of employees (38%) fearing they will never be able to afford to retire, highlighting a disconnect between people’s concerns about retirement and the actions needed to improve outcomes.

Even among those who do engage, activity remains limited. The research shows that in the past 12 months, just two-fifths (40%) of employees have checked the value of their pension, while only around a quarter (28%) have logged into their pension account or app, highlighting that overall engagement remains low despite ready access to information. Of particular concern is that just over a quarter (27%) of people aged over 55 have looked at what they might have at retirement.

There is also evidence that many people lack a clear understanding of their pension and how it works, with just over a quarter of employees (27%[3]) unaware that their pension is invested.

Encouragingly, 32% of employees say they would like a better understanding of how their pension is invested, while 36% want more information about how much they need to retire comfortably. This suggests that improving understanding could be a key way to drive greater engagement.

WEALTH at work’s research comes as wider industry research highlights a broader gap in financial understanding. The Money and Pensions Service estimates that around 22.5 million UK adults[4] do not feel they understand pensions well enough to make informed retirement decisions, while around 46%[5] lack confidence in managing their money.

At the same time, recent research from the Pensions Policy Institute[6] suggests that retirement decisions are often made reactively rather than as part of a clear plan, reinforcing the need for more structured and personalised support to help individuals understand their options and make informed choices.

Jonathan Watts-Lay, Director, WEALTH at work, comments:

“Auto-enrolment has been hugely successful in getting people saving for retirement, but engagement has not necessarily kept pace. Without regular interaction, employees may be missing opportunities to improve their outcomes which includes taking steps to address any potential shortfalls early.

“The research findings suggest that a lack of understanding is a key barrier. Many people are not clear on how their pension is invested or how much they need to retire comfortably, which makes it harder to take meaningful action.

“This highlights the importance of financial education in the workplace throughout people’s working lives to build understanding, confidence and regular engagement with pensions. However, as individuals approach retirement, there is also a clear need for one-to-one retirement guidance to help people understand their options and make informed decisions when they come to access their savings. It can also help them decide if they need to access further support including investment advice.

“As wider industry research has shown, including recently from the Pensions Policy Institute, retirement decisions are often made reactively. Providing structured, personalised guidance at retirement can help individuals better understand their options and turn their savings into good outcomes.

“Our research findings point to a need for more proactive engagement in the workplace, particularly at key life stages and decision moments, combining ongoing financial education with personal guidance at retirement to help employees stay on track and achieve better outcomes. Working with trusted workplace providers helps ensure support is consistent, robust and effective.”