9 in 10 Employees Have a Workplace Pension, But Are They Saving Enough?

Workplace pension participation has become the norm.

The latest government figures show that 90% of eligible employees in Great Britain were saving into a workplace pension in 2025. That represents 22.6 million people putting money aside for retirement.

It is an encouraging milestone. Automatic enrolment has helped millions of employees begin saving, often with contributions from both their employer and the government through tax relief.

However, being enrolled does not automatically mean someone is saving enough for the retirement they want.

There is an important difference between having a workplace pension and having a retirement plan.

Under automatic enrolment, total minimum contributions are usually 8% of qualifying earnings. This will normally include an employee contribution, tax relief and at least 3% from the employer.

These minimums have helped make pension saving part of everyday working life. Contributions are deducted automatically, which means the pension can quietly build in the background.

That convenience can also create a false sense of security.

It is easy to see a pension deduction on a payslip and assume retirement is being taken care of. However, minimum contribution levels are designed to encourage saving. They are not a personalised calculation of how much income an individual will need later.

The amount required will be different for everyone.

Having a Pension Is Not the Same as Having a Plan

Having a pension means money is being saved for retirement.

Having a retirement plan means understanding what that money may provide and whether it supports the future you want.

A plan considers questions such as:

• When would you like to retire?

• What lifestyle do you hope to have?

• What income might you need?

• How long could your retirement last?

• What other pensions and savings do you hold?

• Are your current contributions likely to be enough?
  
  

Without answering these questions, it can be difficult to know whether your pension is on track.

Two people could contribute the same percentage of their earnings and achieve very different outcomes. Their salaries, ages, existing savings and retirement expectations may be entirely different.

That is why participation figures only tell part of the story.

The age at which you start saving affects how long your pension has to grow.

Someone who begins contributing early may benefit from decades of payments and potential investment growth. A person who starts later has less time available and may need to contribute more to work towards a similar outcome.

This does not mean it is ever too late to review your pension.

Increasing contributions, delaying retirement or adjusting future plans could still make a meaningful difference. The important thing is understanding how much time you have and what may be achievable within it.

The longer a potential shortfall goes unnoticed, the fewer options you may have to address it gradually.

Workplace pension contributions are often expressed as a percentage, but the amount reaching the pension will depend on how the scheme calculates pensionable earnings.

In many automatic enrolment schemes, contributions are based on qualifying earnings rather than an employee’s full salary. Bonuses, overtime or other payments may not always be included.

It is worth checking:

• How much you contribute

• How much your employer contributes

• Which earnings are included

• Whether your employer offers contribution matching

• Whether you can increase payments

• How much is currently held in the pension
  
  

Some employers will contribute more when an employee increases their own payments. Not taking advantage of contribution matching could mean missing additional money towards retirement.

Before increasing contributions, it is important to consider what is affordable alongside current household costs and accessible emergency savings.

“Enough” is not a single number.

One person may hope to retire early, travel frequently and support family members. Another may plan to continue working for longer and expect relatively modest expenses.

Housing can also make a major difference. Someone who expects to enter retirement without rent or mortgage payments may need a different income from someone who will continue paying for accommodation.

Retirement expectations may include:

• Essential household bills

• Holidays and hobbies

• Running a car

• Helping children or grandchildren

• Home maintenance

• Health or care costs

• Unexpected expenses
  
  

Thinking about the life you want can make retirement saving feel more relevant. Instead of contributing towards a distant, undefined future, you are working towards a clearer set of goals.

Your annual pension statement should normally include an estimate of the income your pension could provide.

This projection is not guaranteed. It will be based on assumptions about future contributions, investment performance, charges and when you take the pension. However, it can provide a useful starting point.

Try to consider all your likely sources of retirement income, including:

• Current workplace pensions

• Pensions from previous employers

• Personal pensions

• Defined benefit pensions

• Your State Pension forecast

• Other savings or investments
  
  

You can then compare the projected income with the amount you believe you may need.

If there is a shortfall, identifying it does not mean your plans have failed. It gives you an opportunity to explore what could be changed while there is still time to act.

Automatic enrolment has been highly effective at helping more employees save. However, joining a pension is only the first step.

A financial adviser can help bring your pensions together into a complete picture, assess your projected retirement income and explore whether your current contribution level supports your goals.

You may already be on track. You may need to make adjustments. Either way, having clarity can help you make informed decisions rather than leaving the outcome to chance.

Paying into a workplace pension but unsure what it could provide? Speak to My Pension Expert about turning your savings into a clearer retirement plan.

Pension advice is tailored to your individual circumstances and can help you understand the options available before making decisions about your retirement.

This is for general information and does not constitute personal financial advice. Pension projections are estimates and are not guaranteed. The value of investments can fall as well as rise, and you could get back less than you invest.

Data quoted in this article comes from the Department for Work and Pensions publication, Workplace pension participation and savings trends of employees: 2009 to 2025.