Retirement warning: Millions unable to retire until 83 as pension savings fall short

Temie Laleye
Fri, 24 Apr 2026 15:05:40 +0000

Millions of workers across Britain face the prospect of remaining in employment until their early eighties, according to alarming new findings on retirement preparedness.

The study reveals that the vast majority of savers are falling dramatically short of their retirement goals.

Many Britons hope to retire early, but new research suggests most are far from being able to afford it.

A large gap is emerging between when people want to stop working and when they realistically can.

Research from savings platform Flagstone highlights a clear mismatch between retirement expectations and financial reality, with current savings and contribution levels leaving many unable to support their desired lifestyle.

The findings show that just one in seven people are on track to retire at their preferred age while maintaining their target income.

On average, people said they would like to retire at 61, which is already five years before the current state pension age of 66. This is set to rise further to 67 from April.

However, when actual savings and contribution rates are taken into account, the realistic retirement age rises sharply to 83.

This creates a 22-year gap between expectations and reality. It also raises serious concerns, as Office for National Statistics data shows average life expectancy is around 83 for women and 79 for men.

The scale of the savings shortfall becomes clear when examining those closest to retirement.

Britons aged 55 and over have accumulated an average of £146,668 in their pension pots, yet require approximately £1.42million to fund their desired retirement lifestyle.

Respondents indicated they would need around £56,822 annually during retirement, a figure calculated using the widely-used four per cent withdrawal rule.

Across all age groups, the typical yearly pension contribution stands at £6,963.

Perhaps most striking is that higher earnings offer little protection from this gap. Those bringing home more than £100,000 annually still face a retirement readiness shortfall exceeding ten years, demonstrating that saving habits and timing prove as crucial as income.

The research exposes a pronounced disparity between male and female savers. Men have set aside an average of £141,663 for their later years, while women have accumulated just £78,171, roughly half the amount.

Annual contributions follow a similar pattern, with men putting away £7,435 compared to £6,363 for women.

Career interruptions, part-time employment, and the persistent pay gap between genders all contribute to this imbalance.

The UK ranks as the second-worst performer among OECD nations for its gender pensions gap, while Age UK has flagged women as particularly vulnerable to pension poverty.

Engagement levels also differ, with 24 per cent of men having consolidated previous pension pots versus just 17 per cent of women.

Katie Horne, savings expert at Flagstone, described the findings as a significant warning for savers across the country.

"The fact that only 14 per cent of Britons are on track to retire when they want to is a wake-up call but it's not insurmountable," she said.

"Even those on six-figure salaries face a gap of over a decade between their desired and realistic retirement age. That shows this is as much about strategy as it is about income."

Ms Horne emphasised that boosting contributions represents only part of the solution, urging savers to consider consolidating scattered pension pots, seeking higher interest rates for cash holdings, and reviewing fund performance.

"The sooner you act, the more interest you earn and the longer that interest has to grow," she added.