One in eight employees have given up on the idea of retirement entirely.
Not because they do not want to stop working one day.
But because they do not believe it will ever be possible for them.
That is the finding from new research by People's Pension.
And if you are in HR or benefits, that number should concern you.
Not just because of what it means for those employees, but because of what it tells you about the limits of pension communication on its own.
Why pension engagement is a financial wellbeing problem first
Here’s the thing pension providers do not always say out loud.
You can’t get someone to care about retirement in thirty years' time if they can’t get through this month.
When an employee is worried about debt, struggling to pay their rent or living pay day to pay day, a pension feels completely abstract.
It is not that they don’t understand compound interest or the value of starting early.
It is that saving for the future feels like a luxury they simply can’t afford right now.
The research backs this up.
47% of young adults aged 18 to 27 are not engaged with their pension.
36% say the financial services sector fails to communicate the benefits of saving for retirement.
A fifth say pensions are made to feel boring and irrelevant.
But here is what is really going on underneath those numbers.
Pensions feel irrelevant because for a lot of people, right now, they are.
Not because retirement doesn’t matter.
But because the present feels too precarious to think about the future.
The financial wellbeing connection nobody is making clearly enough
Employees who have support with their day-to-day finances are significantly more likely to engage with longer-term financial planning.
When someone has cleared their debt, or got on top of their budget, or finally understood what benefits they are entitled to, the future starts to feel real.
It stops being something that happens to other people and starts being something they can actually plan for.
That is the connection employers are missing.
Pension engagement programmes that sit in isolation from broader financial wellbeing support are trying to build the roof before the foundations are in place.
What the data tells us about what actually works
70% of respondents said they would act if told that starting to save in their twenties could double their retirement pot compared with starting in their thirties.
That is not a disengaged workforce.
That is a workforce waiting for information that feels relevant and real to them.
The same research found that what makes pensions feel less overwhelming is not more product information.
It is a goal tracker or progress bar, knowing they can start with a small amount, seeing examples of what people their age are doing and clear bite-sized steps to follow.
In other words, people want to feel like progress is possible.
They want to see that small actions add up.
They want to feel like it is for them, not just for people who already have money.
That is exactly what good financial wellbeing support does. It starts where people actually are, not where you want them to be.
The practical implication for employers
If you want better pension engagement, start earlier in the journey.
Help employees understand their current finances.
Support them with debt, budgeting and income maximisation.
Give them tools that make their money feel manageable today.
Because once someone feels in control of today, they become genuinely ready to think about the future.
Pension communication that sits on top of financial stress does not land.
Pension communication that comes after someone has been helped to feel more stable has a very different impact.
The 2.2 million people who think retirement is pointless are not a lost cause.
They are people who have not yet been given a reason to believe it is possible.
That reason starts long before the pension conversation.
Written by Caroline Chell
Head of Communications
