One in 10 (10 per cent) UK employees and self-employed workers don’t plan to retire at all, research from Barnett Waddingham, published to coincide with Pensions Awareness Week, has revealed.

The research found that 12 per cent 18-24s expect never to retire, the highest of the pre-retirement ages.

Whilst this figure reduced incrementally as people approach 64, there was then a notable increase in the 65-74 age group, where 14 per cent don’t see retirement in their future, rising to 28 per cent amongst those aged 75 and older.

Barnett Waddingham acknowledged, however, that these figures were influenced by this cohort’s counterpart being more likely to have retired already.

Self-employed workers, in particular, are less likely to plan for retirement, as 22 per cent don’t expect to retire.

The type of pension held was also a key differentiator, as a “mere” 6 per cent of people with a private pension or self-invested personal pension (SIPP) are ‘non-retirees’, compared to 6 per cent for those with a defined contribution (DC) workplace pension, and 7 per cent of defined benefit (DB) pension holders.

However, those without a private or workplace pension (8 per cent of the respondents) are much more likely to have been iced out of retirement planning, as a “whopping” 26 per cent have no plans to retire.

The motivation behind this trend varied across savers, however, as whilst 50 per cent of all workers who don’t plan to retire put this down to financial necessity, 42 per cent said they would choose to keep working because they want to stay active in the workforce.

This was even truer amongst the self-employed, as whilst 46 per cent who didn’t expect to retire out this down to finances, 56 per cent said they would simply prefer to keep working.

“Alarmingly”, however, 20 per cent of respondents think they won’t live long enough to enjoy retirement.

Barnett Waddingham highlighted the growing number of workers planning to forgo retirement as evidence of the “pressing need for systemic reform”, warning that economic uncertainty and inadequate pension savings are leaving many uncertain about their retirement future.

In particular, the group argued that improving retirement education and habits is “crucial”, highlighting auto-enrolment reforms as one potential path forward.

Commenting, Barnett Waddingham partner and head of DC, Mark Futcher, said: "Each year the industry tries to encourage workers to pay attention to their pension, but ten percent of people will have switched off long before that. Why would someone who sees no prospect of retirement in their future try to save for it?

“The elephant in the room is that these people are likely wrong. Most people do retire at some point, and if they’ve under-saved and underprepared then they’ll find themselves having a very uncomfortable retirement indeed. The solution is twofold. The new government must prioritise the ticking pensions timebomb, with an education campaign, auto-enrolment reform, and a set focus on the self-employed who risk slipping through the net.

“Employers must also take a reality check, and consider the financial realities of their employees. The workplace conversation about retirement and pensions must evolve to account for the ever more prevalent apathy and hopelessness, and member comms must evolve to offer more targeted support to workers approaching retirement. The regulators can also help by clearly defining advice and guidance so the industry can offer support at an appropriate level and cost.”

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