Context

High interest rates and the cost-of-living crisis of the last few years have created a climate of financial uncertainty in the UK and has impacted people’s ability to save for retirement. For the fourth year running, Standard Life wanted to understand the views of people from a range of cultural and socio-economic backgrounds and across the generations.

The study refers to four generations of people:

• Gen Z, who were aged 18 to 27
• Millennials, aged 28 to 43
• Gen X, aged 44 to 59
• Baby Boomer+, who were aged 60-80.

The study

Standard Life commissioned Ipsos UK to undertake research to understand how people feel about their finances, pensions and retirement plans. The report addresses two overarching research questions:

• How is the cost of living affecting people’s financial wellbeing?
• What effect is this having on their retirement planning?

A sample of 6,000 adults aged 18 to 80 from across the UK were surveyed in July and August 2024, and the resulting data set were weighted to be a nationally representative by several factors including age, generation, gender, region, household income and family composition.

The report brings people’s thoughts and experiences to life using four labels:

• the Planner, who “has put a great deal of thinking into their retirement plans”
• the Non-planner, who “hasn’t put any thinking into their retirement plans”
• the Advised, who “has paid for financial advice from a registered professional”
• the Non-advised, who “hasn’t paid for financial advice from a registered professional".

Key findings

• Financial and mental wellbeing: 48% of people reported feeling positive about their financial situation, more than at any time since 2021, when the survey was first conducted.
  • 35% were still anxious about interest rate increases, rising to 53% among Millennials.
  • 74% of Millennials and Gen Zs were more cautious about their finances because of the cost of living.
• Attitudes and behaviours towards savings and pensions: People were more confident about their retirement options compared with previous surveys, ranging from 38% of Gen Xs to 59% of the Baby Boomer+ generation in 2024.
  • 35% of women were confident about their retirement options, compared with 51% of men.
  • 90% of people overall wanted a guaranteed regular income for life.
  • 1 in 7 peopled planned to use inheritance as a source of retirement income, ranging from 8% of the Baby Boomer+ generation to 17% of Gen Xs.
• Retirement hopes, expectations and experiences: People typically hoped to retire at 62 but expected to retire at 66. The Advised were most hopeful (63), followed by men (66) and the Planners (66).
  • 45% of people expected to work past the State Pension age.
  • 34% of Gen Xs expected a pension pot of less than £100,000.
  • 67% of retirees were happy with their retirement decisions.
• Planning and using a financial adviser: 75% of people said they had done little or no retirement planning. Among those with household incomes of less than £30,000, the Planners were much more likely to report feeling positive about their financial situation (51%) than the Non-Planners (21%).
  • 69% of people who had taken financial advice felt they were better off as a result of it.
  • 32% Gen Zs had used social media to find information on retirement.

Points to consider

Methodological strengths or limitations:

• While the overall sample was large and described as nationally representative on important characteristics, few methodological details are given to assess the robustness of the results.
• Subgroup analysis was based on much small sample numbers than the headline sample size.
• Reference was made to significant differences, but it is not clear if this related to statistically significant differences.

Applicability:

• The findings should be of interest to a range of stakeholders, including policymakers, financial services providers and industry associations, financial and money advisers and researchers.

Relevance:

• The research is timely, and offers insights into how different generations feel about retirement.