More than one in eight Gen Z adults aged 18 to 27 (12 per cent) believe there is little point in engaging with their pension because they do not think they will ever be able to retire, according to research from People’s Pension.
The study, which describes this group as “NERDs”, the Never Ever Retiring Demographic, found that around 47 per cent said they are not actively engaged with their pension savings.
The findings point to a growing disconnect between younger savers and the pensions industry, with more than a third (36 per cent) of young people saying financial services firms do not communicate the benefits of retirement saving effectively.
Additionally, 27 per cent felt providers focus too much on selling products rather than educating consumers, while 20 per cent said pensions are presented as boring and irrelevant. A further 16 per cent said industry communications rely too heavily on jargon.
The research found younger savers respond best to simple messages, with 70 per cent saying they would be motivated to save if they understood that starting in their 20s could double their retirement pot compared with starting in their 30s. Meanwhile, 66 per cent said they would act if shown how saving £10 a week from age 25 could grow to £76,000 by retirement.
People’s Pension proposition director Kirsty Ross says: “In a world where financial doom dominates pension conversations, young savers are tuning out. Our research shows they are not disengaged because they don’t care, they are disengaged because the messages aren’t working. Scare tactics and jargon are alienating the very people we need to reach.
“What cuts through is honesty, simplicity and practical advice that shows how small steps today can have a huge impact tomorrow. That’s why we’ve launched our Pension Drop campaign: to change the conversation and show how taking small steps now can make a big difference tomorrow – giving people back a sense of control over their financial futures.”
