A third (33%) of employees believe they will never have enough money to retire because of increasing expenses.
New research from Wealth at Work also revealed that more than four in five (83%) of respondents think the current cost-of-living crisis will mean they have to work longer before retiring.
The figures showed that 13% of the 2,000-plus full-time workers surveyed have either reduced or stopped the amount they save towards their pension due to increasing prices, while nearly three in 10 (29%) say they may think about stopping payments later. Almost a third (30%) admitted they may reduce future payments.
Additionally, one in 10 (10%) who are eligible to access their pension have done so earlier than planned to boost their income, while nearly a third (31%) either intend to or may think about it it in the future.
Jonathan Watts-Lay, director at Wealth at work, said: “It’s alarming that these latest figures suggest that so many people are thinking about stopping or reducing their pension contributions to help alleviate current financial pressures. Whilst this is understandable, it really should be a last resort. Employees may not realise that whilst it may make relatively small savings each month, the impact on retirement savings to be used in later life will be dramatic due to lost employer contributions and tax relief.
“As the research shows, many are concerned if they really can afford to retire at all, with many believing that they will have to work longer to make up for a shortfall in savings. For those approaching retirement, it couldn’t be more important to make sure they have a plan in place.”
In terms of seeking help with their pension, more than half (56%) consult unqualified sources, with 40% speaking to family, friends or colleagues and 16% not discussing it with anyone. Just 15% speak to their pension provider, while 13% turn to their employer, 8% consult a regulated financial adviser and 3-4% speak to specialist bodies such as Pension Wise or Money Helper.
Watts-Lay added: “As highlighted in the research, it is very common for people to turn to their friends and family for guidance on their pensions, but they may not be the most qualified or indeed knowledgeable source. The good news is that many employers are now offering financial education in the workplace, as well as other support for employees.”