Vulnerable groups in the UK are retiring with thousands less in pension income than the population average
Millions of people across the UK are reaching retirement age with private pension savings significantly below the national average, leaving them at greater risk of financial hardship, new research suggests.
The 2025 Underpensioned Report, published by workplace pension provider NOW: Pensions and the Pensions Policy Institute (PPI), reveals that underpensioned groups — including women, disabled people, carers, single parents, ethnic minorities, and the self-employed — typically retire with private pension incomes between £3,650 and £6,750 a year. This compares to an average income of £8,500 across the wider UK population.
The findings highlight the stark inequalities that persist in pension saving despite the success of auto-enrolment, which since 2012 has brought over 11 million more people into workplace schemes. Many individuals in underpensioned groups, however, still fail to qualify for auto-enrolment due to low earnings or part-time work patterns, meaning they miss out on vital retirement savings.
Of all the groups analysed, people with disabilities were found to be most at risk, with pension incomes at just 43% of the national average. Single mothers and the self-employed also lag significantly behind, each achieving only around 54% of the average income.
Although there has been some progress since the last report in 2022 — particularly among carers and ethnic minority groups where employment rates have risen — the overall gap remains substantial.
Joanne Segars, Chair of Trustees at NOW: Pensions, called for urgent policy reforms, warning that without intervention, millions would continue to face financial insecurity in later life.
“That’s why we’re suggesting key reforms, including removing the £10,000 auto-enrolment earnings trigger and introducing a family carer’s top-up,” Segars said. “These measures would help ensure that everyone, regardless of working patterns or caring responsibilities, has a fairer chance at building a secure future.”
The report recommends five policy changes to address the pension gap, including scrapping the lower earnings limit for pension contributions and ensuring pension pots are considered in divorce settlements.
Samantha Gould, Head of PR and Campaigns at NOW: Pensions and co-author of the report, said systemic barriers continue to impact saving rates among underpensioned groups.
“Many of these individuals are more likely to work part-time, earn lower wages, or take time out of employment for caring responsibilities. All of which contribute to lower pension savings and greater financial insecurity in retirement.”
John Adams, Senior Policy Analyst at the PPI says: “While the rate of employment in the general population has fallen slightly since the previous report, carers, single mothers and divorced women are particularly vulnerable. Changes to automatic enrolment, such as allowing income from multiple jobs to count toward eligibility, could make a real difference.”
The findings also show that while women’s eligibility for auto-enrolment has improved — rising from 77% in 2020 to 85% in 2025 — they still retire with just 67% of the private pension income of their male counterparts.