Positive pension sentiment has surged in the last three months, with the Pension Confidence Indicator soaring to +22 in March 2024. This marks a notable increase from -10 in December 2023 and -9 in September 2023. This shift can be attributed to a significant decrease in negativity among those under the age of 55 and a further increase in confidence among those at and near retirement age.
Key findings for under 55s:
- Positive pension sentiment increased slightly, from 34% to 39% from December 2023 to March 2024, to become the dominant perspective among under 55s.
- Negative pension sentiment fell significantly from 56% to 38% over the same period. However, the proximity of this figure to positive sentiment suggests an absence of a clear consensus when it comes to retirement and pensions.
- The top reasons for feeling positive were: ‘my employer contributions are relatively good’ (41%); ‘my personal contributions are relatively good’ (38%) and ‘my fund performance is good’ (21%).
- The top reasons for feeling negative were: ‘I can’t afford to contribute enough’ (34%); ‘I think my pension pot is small’ (34%) and ‘I’m worried that my costs will be high in retirement’ (26%).
Key findings for over 55s:
- Pension optimism continued to rise as almost two-thirds (63%) of over 55s felt positive in March 2024, up from almost half (47%) in December 2023.
- Meanwhile, negative pension sentiment diminished to less than a quarter (24%) in March, a significant drop from its peak at 52% six months prior.
- The top reasons for feeling positive were: ‘I am entitled to the State Pension (60%); ‘I have a good Defined Benefit pension’ (21%) and ‘I am already enjoying a comfortable retirement’ (21%).
- The top reasons for feeling negative were: ‘I wish I’d saved more’ (27%); ‘None’ (23%) and ‘I’m worried about inflation’ (28%).
Age plays a pivotal role in shaping confidence levels
In the latest Pension Confidence Index (‘Index’), pension confidence among working age adults declined with age, starting robustly in the early stages of their career (54% of 18-25 years old felt positive about their pension) and gradually diminishing as retirement approaches. Almost half (47%) of workers aged 44 to 54 felt negative about their pension, higher than any other age group.
The opposite is true for those near or at retirement. The majority (54%) of 55-64 year olds felt positive about their pension, while over two-thirds (78%) of over 65s expressed the same sentiment. Notably, the highest level of pension confidence was observed among males aged 65 and above, with an impressive 82% of this group reporting pension confidence.
The role of the State Pension
As in previous Indexes, the State Pension remained a key factor in influencing retirement sentiment, particularly for how those near or at retirement felt about their future. Over half (60%) of over 55s identified it as a top reason for positive pension sentiment. This is a noticeable increase from 38% in December and could be attributed to the 8.5% State Pension rise this month.
Conversely, among under 55s, expectations of the State Pension waned. For the first time since the Index’s inception, the State Pension dropped out of the top three reasons for positive pension sentiment. Instead, there was a greater emphasis placed on ‘increasing contributions’, which rose from 27% to 35% from December to March, suggesting a greater focus on funding retirement through personal contributions rather than a reliance on the State Pension.
An increased importance on fund performance was also evident among working age savers. ‘Changing plans to improve investment performance’ emerged as a top priority, up from 13% in December to 19% in March. In addition, ‘satisfaction with fund performance’ emerged as a top reason (21%) for feeling positive, a significant jump from 11% in December and 7% in September.
Men continue to have greater pension positivity than women
Despite overall positive trends, a gender disparity in pension confidence persists. Men continued to exhibit greater pension positivity than women across all age groups. This contrast is particularly striking among individuals near or at retirement age, with over half (58%) of men noting positive pension sentiments compared to only 37% of women. This may be partly explained by the persistent gender pension gap in the UK, which tends to widen with age.
Becky O’Connor, Director of Public Affairs at PensionBee, commented: “It’s encouraging to see a growing sense of pension optimism in the UK, suggesting factors such as falling inflation rates and reduced cost of living pressures, in addition to a recovery in stock market fortunes and the State Pension increase, have played an important role in bolstering confidence.
While it’s often assumed that younger individuals feel more confident when it comes to their pension, due to having a longer period to save, this research highlights a nuanced reality. Initial zeal for pension savings can give way to competing financial demands during the middle of one’s career. It appears for many, it’s the proximity to retirement and the attainment of financial clarity that reignites this pension confidence later in life. However, it’s crucial to acknowledge the persistence of the gender gap in pension confidence.
These dynamics highlight the multifaceted nature of pension confidence, underscoring the importance of financial planning for all individuals across all stages of life.”
Appendix
Table 1: Pension Confidence Indicator
| September 2023 | December 2023 | March 2024 | |
| Feeling quite or very positive | 42% | 41% | 52% |
| Feeling quite or very negative | 51% | 51% | 30% |
| Indicator reading | -9 | -10 | +22 |
The Pension Confidence Indicator – a new measure of sentiment towards retirement – is the difference between the proportion of British adults stating they feel positive and the proportion who feel negative about their pension outlook, with a positive number (plus) indicating more positive than negative sentiment and a negative number (minus) indicating more negative than positive sentiment.
Source: PensionBee, March 2024. A nationally representative sample of c.2,000 GB adults aged 18-85. Does not include responses of “I don’t know / no idea”. Numbers have been rounded.
Table 2: Changing pension sentiments of under 55s from December 2023 to March 2024
| “How do you feel about your current pension outlook in general?” | ||||||||||
| December 2023 | March 2024 | |||||||||
| Avg | 18-24 | 25-34 | 35-44 | 45-54 | Avg | 18-24 | 25-34 | 35-44 | 45-54 | |
| A) Very positive – I know I am on track for a good retirement | 10% | 23% | 11% | 9% | 6% | 10% | 22% | 7% | 11% | 8% |
| B) Quite positive – I think I am doing OK, relatively | 24% | 29% | 23% | 23% | 23% | 29% | 33% | 32% | 30% | 30% |
| C) No idea | 10% | 6% | 8% | 10% | 10% | 16% | 26% | 15% | 16% | 15% |
| D) Quite negative – I am concerned I am not saving enough for retirement | 34% | 23% | 35% | 35% | 36% | 28% | 13% | 34% | 33% | 36% |
| E) Very negative – I know I am not saving enough | 23% | 16% | 23% | 20% | 27% | 9% | 7% | 11% | 11% | 11% |
Source: PensionBee, March 2024. A nationally representative sample of c.1,000 GB adults aged 18-54. Averages calculated based on sample size. Numbers have been rounded.
Table 3: Comparing reasons for positive pension sentiments among under 55s from December 2023 to March 2024
| Select three things that make you feel positive about your pension, even if your overall outlook might not be wholly positive. | December 2023 | March 2024 |
| A) My personal contributions are relatively good | 20% | 38% |
| B) My employer contributions are relatively good | 24% | 41% |
| C) The performance of my pension fund is relatively good | 11% | 21% |
| D) I have a generous defined benefit scheme | 9% | 9% |
| E) I am happy that my pension is low cost | 12% | 17% |
| F) I have already accrued a big pot | 5% | 6% |
| G) My forecast pot size is high | 5% | 6% |
| H) I will have other sources of wealth for retirement: property | 10% | 13% |
| I) I will have other sources of wealth for retirement: inheritance | 13% | 10% |
| J) I will have other sources of wealth for retirement: other investments | 11% | 9% |
| K) I’m confident that the State Pension will form part of my retirement income | 18% | 18% |
| L) Other | 4% | 3% |
| None | 22% | 14% |
Source: PensionBee, March 2024. A sample of 1,000 GB adults aged 18-54. Numbers have been rounded.
Table 4: Reasons for negative pension sentiments among under 55s from December 2023 to March 2024
| Select three things that make you feel negative about your pension, even if your overall outlook might not be wholly negative. | December 2023 | March 2024 |
| A) I can’t afford to contribute enough | 29% | 34% |
| B) My employer doesn’t contribute enough | 9% | 15% |
| C) The performance of my existing pension is disappointing | 10% | 13% |
| D) I think my pension is high cost | 7% | 12% |
| E) I think my pension pot is small | 28% | 34% |
| F) I think my forecast pot size is low | 17% | 18% |
| G) I don’t have other sources of wealth for retirement | 25% | 24% |
| H) I’m worried I’ll spend it too fast and have a shortfall in later life | 18% | 17% |
| I) I’m worried that my costs will be high in retirement | 27% | 26% |
| J) I’m not confident that the State Pension will form part of my retirement income | 17% | 15% |
| K) Other | 3% | 2% |
| None | 7% | 8% |
Source: PensionBee, March 2024. A sample of 1,000 GB adults aged 18-54. Numbers have been rounded.
Table 5: Top pension priorities for under 55 in the next year, from December 2023 to March 2024
| “What, if any of the following, do you think you might do in the next year?” Choose up to three options. | December 2023 | March 2024 |
| A) Increase my contributions | 27% | 35% |
| B) Reduce my contributions temporarily | 7% | 8% |
| C) Stop my contributions temporarily | 6% | 8% |
| D) Change plans to improve investment performance | 13% | 19% |
| E) Change plans to align my pension with my values | 8% | 12% |
| M) Research the best ways to access/ take an income from my pension | 8% | 10% |
| G) Consolidate my old pensions into one pot | 15% | 13% |
| H) Use calculators and tools to see how much I need to save | 20% | 17% |
| I) Find out about how much State Pension I could get and when | 17% | 12% |
| J) Get backdated State Pension credits | 5% | 2% |
| K) Book a free Pension Wise appointment | 7% | 4% |
| L) Make an appointment with a financial adviser | 13% | 8% |
| N) Research the best ways to minimise tax on my pension | 12% | 5% |
| N) Research best ways to minimise tax on my pension | 12% | 6% |
| O) Other | 2% | 2% |
| None | 3% | 18% |
Source: PensionBee, March 2024. A sample of 1,000 GB adults aged 55-85. Numbers have been rounded.
Table 6: Changing pension sentiments of over 55s from September to December 2023
| “How do you feel about your current pension outlook in general?” | ||||||
| December 2023 | March 2024 | |||||
| Avg | 55-64 | 65+ | Avg | 55-64 | 65+ | |
| A) Very positive – I know I am on track for a good retirement | 11% | 10% | 12% | 17% | 11% | 23% |
| B) Quite positive – I think I am doing OK, relatively | 36% | 35% | 41% | 47% | 43% | 54% |
| C) No idea | 8% | 9% | 6% | 9% | 11% | 8% |
| D) Quite negative – I am concerned I am not saving enough for retirement | 31% | 33% | 25% | 15% | 24% | 10% |
| E Very negative – I know I am not saving enough | 14% | 13% | 16% | 8% | 11% | 5% |
Source: PensionBee, March 2024. A nationally representative sample of c.1,000 GB adults aged 55-85. Averages are calculated based on sample size. Numbers have been rounded.
Table 7: Reasons for positive pension sentiments among over 55s from December 2023 to March 2024
| Select three things that make you feel positive about your pension, even if your overall outlook might not be wholly positive. | December 2023 | March 2023 |
| A) I have a good Defined Benefit pension | 11% | 21% |
| B) I have a good Defined Contribution pot | 10% | 17% |
| C) I am entitled to the full State Pension | 38% | 60% |
| J) I have other sources of wealth for retirement property | 6% | 8% |
| E) I am happy with the performance of my investments | 11% | 16% |
| F) I am on track for a comfortable retirement | 9% | 12% |
| G) I am already enjoying a comfortable retirement | 7% | 20% |
| H) I am on track for a moderate retirement | 16% | 14% |
| I) I am already enjoying a moderate retirement | 14% | 15% |
| J) I have other sources of wealth for retirement e.g.property | 6% | 7% |
| K) I have other sources of wealth for retirement e.g. inheritance | 6% | 5% |
| L) I have other sources of wealth for retirement e.g.investments | 8% | 7% |
| M) Other | 2% | 3% |
| None | 16% | 8% |
Source: PensionBee, March 2024. A nationally representative sample of 1,000 GB adults aged 55-85. Numbers have been rounded.
Table 8: Reasons for negative pension sentiments among over 55s from December 2023 to March 2024
| Select three things that make you feel negative about your pension, even if your overall outlook might not be wholly negative. | December 2023 | March 2024 |
| A) My pension income is going to be hard to live on | 15% | 17% |
| B) My pension income is hard to live on | 9% | 13% |
| C) I am very likely to run out of personal pension savings | 5% | 13% |
| D) I have run out of private pension and am dependent on the state pension | 3% | 13% |
| E) I will be completely dependent on the State Pension | 11% | 14% |
| F) I will not receive a full State Pension | 7% | 10% |
| G) I wish I had saved more for retirement | 20% | 27% |
| H) I will need to keep working past State Pension age | 9% | 8% |
| I) I will need to keep working passed my desired retirement age | 11% | 6% |
| J) I have high costs in retirement (ie, mortgage, rent, other debt) | 6% | 3% |
| L) I have to help my family out financially and this is leaving me worse off | 6% | 5% |
| L) I have to help family out financially and this is leaving me worse off | 4% | 4% |
| M) I have been scammed out of some of my pension | 1% | 1% |
| N) I am worried about the effects of inflation on my living standards | 24% | 20% |
| O) I am worried about the effects of poor stock market performance on my pension pot | 9% | 6% |
| P) I don’t trust the Government to maintain a decent State Pension | 22% | 18% |
| Q) Other | 2% | 1% |
| None | 14% | 23% |
Source: PensionBee, March 2024. A nationally representative sample of 1,000 GB adults aged 55-85. Numbers have been rounded.
Table 9: Top pension priorities for savers over 55 in the next year, from September to December 2023
| “What, if any of the following, do you think you might do in the next year?” Choose up to three options. | December 2023 | March 2024 |
| A) Buy an annuity | 3% | 7% |
| B) Take some of my tax-free lump sum | 8% | 11% |
| C) Take all of my tax-free lump sum | 7% | 9% |
| D) Starting taking an income using flexi-access drawdown | 4% | 6% |
| E) Take more income from my pension | 5% | 7% |
| F) Take less income from my pension | 5% | 5% |
| G) Research sustainable withdrawal strategies so I can make my pot last | 5% | 7% |
| H) Change plans to improve investment performance | 5% | 5% |
| I) Change plans to align my pension with my values | 3% | 3% |
| J) Change plans to reduce costs | 12% | 9% |
| K) Change plans to reduce risk | 5% | 3% |
| L) Consolidate my old pensions | 7% | 3% |
| M) Use calculators and tools to see how much I can take from my pension | 6% | 2% |
| N) Find out how much State Pension I can get and when | 17% | 8% |
| O) Start claiming my State Pension | 9% | 4% |
| P) Defer my State Pension | 5% | 1% |
| Q) Claim credits for looking after my grandchildren | 2% | 2% |
| R) Get backdated State Pension credits | 3% | 1% |
| S) Book a free Pension Wise appointment | 9% | 4% |
| T) Make an appointment with a financial advisor | 9% | 7% |
| U) Research the best ways to access/take an income from my pension | 6% | 7% |
| V) Research the best ways to minimise tax on my pension | 10% | 7% |
| W) Other | 4% | 2% |
| None | 7% | 4% |
Source: PensionBee, March 2024. A nationally representative sample of 1,000 GB adults aged 55-85. Numbers have been rounded.