Six in Ten Millennials Are Struggling to Save for Retirement

Retirement can feel a long way off when you’re juggling work, family, housing costs and everything else life throws at you. But new research shows that for many Millennials, those everyday pressures are having a real impact on their future finances.

In fact, six in ten Millennials (59%) say they’re struggling to save for retirement. And they’re not the only ones feeling the squeeze. Nearly half of Gen Z (48%) and 39% of Gen X also say putting money aside for later life is a challenge.

So what’s really getting in the way?

Short-Term Pressures Are Taking Priority

Millennials are now mostly in their late 20s to early 40s, a stage of life that comes with big financial responsibilities. Careers may still be evolving, families are growing, and costs are rising fast.

The research shows two key barriers standing in the way of retirement saving:

• Fluctuating incomes – one in four Millennials (25%) say this makes it difficult to commit to regular pension contributions.

• Childcare costs – another 24% say childcare responsibilities make saving for retirement almost impossible.

These aren’t lifestyle choices. They’re real, unavoidable expenses.

Why Pensions Slip Down the List

Millennials often get a bad rap for being “bad with money”, but the reality is far more practical. Only one in five (20%) Millennials say paying into a pension is a top priority.

Instead, their money is going on:

• Housing costs

• Student loan repayments

• Childcare and family expenses

And the pressure is starting to show. Over the past year:

• 7% of Millennials have reduced their pension contributions

• Another 7% have stopped contributing altogether

While automatic enrolment means some savings are still happening, there’s a real risk that contributions never increase again once short-term pressures ease. Over time, that can create a retirement gap that’s much harder to close later on.

The Bigger Picture: A Growing Savings Gap

This isn’t just a Millennial issue. Across the UK, an estimated 17 million people aren’t saving enough to achieve the retirement lifestyle they expect.

For Millennials, this should act as an early warning sign. The earlier gaps are spotted and addressed, the easier it is to make meaningful progress, even with small changes.

Planning doesn’t have to be complicated or overwhelming.

How Employers Can Make a Difference

Employers have an important role to play in supporting long-term financial wellbeing. Simple measures can have a big impact, such as:

• Continuing pension contributions during parental leave or career breaks

• Offering financial wellbeing programmes that help employees balance short-term spending with long-term saving

• Providing clear, accessible education around pensions and workplace benefits

Confidence grows with understanding. When people know what options are available, they’re more likely to review contributions after major life events and take control of their financial future.

The Gender Gap in Retirement Saving

For many Millennial women, the challenge is even greater.

Career breaks, parental leave and caring responsibilities often mean lower earnings and reduced pension contributions. Add rising childcare and housing costs into the mix, and saving for the future can feel out of reach.

The numbers highlight the scale of the issue:

• Pension contributions between men and women begin to diverge as early as ages 25–34

• By 45–54, men are contributing around 50% more each month (£245 compared to £165)

Without action, this gap risks leaving many women far less financially secure in retirement.

Taking Action – One Step at a Time

If you’re feeling behind with your retirement savings, you’re not alone, and it’s not too late to take control.

Small, manageable steps can make a real difference, such as:

• Gradually increasing pension contributions when circumstances change

• Making the most of workplace benefits

• Reviewing your finances after major life events

• Speaking to an adviser for clear, personalised guidance

At Planit Financial, we work with people balancing real-life pressures, childcare, housing costs, career changes and everything in between. We’ll help you create a realistic plan that fits your life today, while still building confidence about tomorrow.

Building a secure financial future isn’t about being perfect; it’s about getting started and moving in the right direction. 

Not sure if your retirement plan is on track?

Book a friendly chat with us, and we’ll help you understand your options and create a plan that actually fits your life now and the future.