Table of Contents
Show more
Show less
If you’re saving for retirement, it’s natural to question whether you’re on track to amass enough to make you financially comfortable, and to wonder how your pension savings compare to those of others.
But according to research from The People’s Pension, a workplace pension provider, one in five savers have never checked the value of their pension plans.
To help savers work out where they stand, we’ve gathered data from the UK government and from leading pension providers to determine the national average pensions kitty, along with how pot size varies by age, gender and region.
We’ve also sourced some tips that could help boost the value of your pension savings.
Looking for financial advice to manage your pension?
Get a free initial consultation with a local FCA registered adviser
Overall average
According to data from PensionBee, the average UK pension pot was worth £20,077 as of May 2024.
However, some individuals hold multiple pension pots, so the combined value of their savings will be higher.
In its latest study, which gathered data between April 2018 and March 2020, the Office for National Statistics (ONS) found that 70% of adults have one or more pension pots, and the savings total was £57,000.
This median includes both workplace pensions and self-invested personal pensions (SIPPs).
The overall median – which factors in adults without a pension pot – was much lower, at £14,500.
Upward trajectory
Despite the fact that some UK adults don’t have any pension savings, the overall trend appears to be moving in a positive direction, ONS data suggests.
The median value of private pension savings almost doubled between July 2012 and March 2020, from £7,300 to £14,500.
The percentage of working age adults contributing to a workplace or personal pension pot also increased from 43% to 57% in this period.
This upward trend could be due, in part, to the introduction of automatic enrollment in 2012. Under auto-enrollment rules, all full-time employees must be enrolled in a workplace pension scheme by their employer.
But it’s not all good news. According to Scottish Widows’ 2024 Retirement Report, 38% of working age adults are not on track to achieve what the Pensions and Lifetime Savings Association deems a ‘minimum lifestyle’ in retirement – an increase of 3% compared with 2023.
This lifestyle measure, equivalent to an annual income of at least £14,400, covers basic expenses such as food and bills, with enough left over for a week-long UK holiday each year, new clothing and footwear and a streaming service subscription.
Average pension savings by age
These averages conceal some significant differences in savings by age, however. As you might expect, pot values peak just before the typical age of retirement.
According to the latest ONS data, 70% of individuals aged 16 or over hold at least one pension pot.
Below is a breakdown of how these pension savings vary, on average, by age group:
Average pension pot size by income
According to the latest ONS Wealth and Assets Survey, the wealthiest 10% of households held 43% of Great Britain’s wealth as of March 2020 – and this discrepancy bears out when it comes to pension savings.
In March 2020, the top 10% of UK households by income held a total of £1,813 billion in private pension savings, while the bottom 10% held just £163 billion.
Pension savings by region
Average pension pot value also varies between UK regions.
According to a survey of over 240,000 PensionBee customers, the following UK regions have the highest value pension pots on average:
- South East England: £25,734
- Greater London: £23,393
- South West: £19,557
At the other end of the spectrum, the following UK regions have the lowest average pension pot value:
- Northern Ireland: £13,844
- North West England: £15,651
- Wales: £15,767
In general, workers in regions that pay higher salaries have more in their pension pots.
Gender pension gap
According to PensionBee, men’s pension pots are 38% larger than women’s on average, and the gap widens as workers approach retirement age.
For workers under 30, men have 18% more in their pension pot than women, on average. But by the time they are 50 or older, the gender pension gap expands to 45%.
This gap is larger in some UK regions than others. In Northern Ireland, for example, the average man has £16,390 saved in a pension pot, while women in the same region have just £9,136 in their pot on average.
The gender pension gap is lowest, at 29%, in Greater London.
This discrepancy in pension pot value persists for a couple of key reasons. First, women typically earn less than men, so have less cash available for pension contributions on average. According to ONS figures, the UK gender pay gap stood at 7.7% as of April 2023.
Women are also more likely than men to take a career break or reduce their working hours to raise children.
A study by interactive investor found that, by age 45, the average man is on track to have a larger pension pot at retirement than the average woman – even if he made no additional monthly contributions.
Alice Guy, head of pensions and savings at interactive investor, says: “It’s eye opening that men are already on track for a bigger retirement pot on average by their mid-40s even if they don’t pay a penny more into their pension.
“That’s mainly due to the motherhood penalty, as women often take the main responsibility for caring for children, with a huge knock-on impact on earnings and pension wealth. Women are more likely to care for children and work part time in their 40s and beyond and are more likely to become carers later in life.
“It’s a double-whammy as the impact of investment compounding also works in favour of those who have bigger pots in mid-life. Men have almost twice as much saved by their mid-40s, and that gap will continue to grow as investment returns snowball over time.”
Keeping on top of your pension pot
Checking in on your pension pot or pots can help ensure you’re on track with your retirement savings – but a survey by The People’s Pension found 32% of UK adults don’t know the value of their retirement savings.
Luckily, it’s never too early or too late to review your retirement savings. Below are a handful of tips that could help boost the value of your pension pot in the long-run:
Consolidate pension pots
The average worker has about 12 different jobs over the course of their career, and could be enrolled in several different workplace pension schemes.
Having multiple pots on the go can make it tricky to keep track of your savings, and it may make sense to consolidate them with a single provider.
Becky O’Connor, director of public affairs at PensionBee, says: “Consolidating will not only help you assess if you’re on track for the lifestyle you want in retirement, but it can also reduce the burden of monitoring numerous pension accounts.
“Unfortunately, it can be easier to lose track of old pensions than you may think, as almost 1 in 10 workers believe they’ve lost a pension pot worth more than £10,000 during the course of their career.”
Increase your contributions
If it’s feasible to do so, increasing your monthly pension contributions – even by a small amount – can have a significant impact on the overall value of your pot over time.
If you’re enrolled in a workplace pension, you can ask your employer to increase your contributions whenever you like.
PensionBee’s O’Connor says: “Even a small increase can make a difference over time and the power of compound interest means the earlier and more you save, the more your money will grow.”
Pension contributions receive tax relief, which means you’ll also benefit from paying less tax on your earnings overall.
Review your investments
Checking where your pot is invested, and how it’s performing, can also help ensure you’re on track for your target retirement income.
If your pension provider allows you to choose where funds are invested, it could make sense to move money into lower risk investments as you approach retirement, in order to preserve the value of your pot.
On the other hand, if your working life has just begun, you may opt for higher-risk options that have the potential for higher returns over time.
