Gen Z wants to retire early, but many rely on minimum pension contributions and take high-risk investment approaches, though saving more early could help secure better retirement outcomes, according to Standard Life.
The 2025 Retirement Voice report finds Gen Z have ambitious retirement goals, aiming to retire at 60, but many rely heavily on minimum auto-enrolment contributions and take a high-risk and digital-first approach to investing.
According to the research, only 13 per cent of Gen Z see pension saving as a top financial priority. Meanwhile, 59 per cent believe that being auto-enrolled into a workplace pension is enough to secure their retirement.
The research also shows that a quarter invest in stocks, a quarter in crypto, nearly one in five use AI for retirement planning and more than one in five follow social media influencers. They are also more willing to take investment risks than older generations, with 48 per cent comfortable doing so, compared with 24 per cent of Gen X and 14 per cent of Baby Boomers.
According to the report, auto-enrolment has helped build a savings habit, with only 8 per cent opting out. However, it may create a false sense of security, as around four in ten working-age people are under-saving, and relying on minimum contributions alone is unlikely to fund a comfortable retirement.
Standard Life’s research also highlights that short-term priorities often take precedence for Gen Z. More than a third admit they prefer “living for today” rather than long-term planning, focusing instead on day-to-day finances, holidays, property or emergency savings. Current income pressures are clear, with 44 per cent only coping and 28 per cent struggling, making it challenging to fund a retirement potentially lasting 25 years or more.
Research shows that time remains an advantage for Gen Z. Standard Life calculates that someone starting work at 25,000 pounds per year and contributing 8 per cent from age 22 could build a pension of 210,000 pounds by 68, adjusted for inflation. Increasing contributions by just 2 per cent could raise this to 262,000 pounds, demonstrating the potential of compound growth over decades.
Standard Life Centre for the Future of Retirement director Catherine Foot says: “Gen Z are at the start of their financial lives and are understandably aiming high – with ambitions to retire at 60, earlier than any other generation. However although they do have the benefit of time, our Retirement Voice research shows a clear challenge: their aspirations and approach to saving might not match the financial realities ahead. It’s no surprise that short-term goals like holidays and getting on the property ladder feel more urgent than prioritising pension saving, but the danger is that longer-term planning slips too far down the list and by relying on minimum auto-enrolment contributions, many are at risk of falling short in later life.
“Shaped by a digital-first world, Gen Z also bring a fresh perspective to saving and investing. Influenced by social media, AI, the benefits of investing, and new asset classes like crypto, they are more open to risk and innovation than previous generations. That energy creates real opportunities – but it also underlines the importance of trusted, accessible guidance to help them cut through volatility and avoid possible unexpected pitfalls, and it’s important not to ignore the benefits of pension saving alongside this.
“The encouraging truth is that time is firmly on their side: even small increases in contributions today can translate into a step-change in retirement outcomes. But to close the gap between hopes and reality, the pensions system must evolve with them – delivering advice and support that feels relevant, engaging, and aligned to modern careers and financial behaviours. Gen Z are standing at a pivotal crossroads. With the right tools, planning and encouragement, many will be able to turn ambition into action – and build the secure, independent retirement they aspire to.”
