“Other Priorities” Hampering Gen Z’s Interest In Pensions

Against a backdrop of 15m not saving enough for their retirement and the government establishing a Pensions Commission to consider the issue, the Society of Pension Professionals (SPP) held the first in a series of events on pensions adequacy this month.

Over 180 pension professionals attended the event and were asked what they thought is the biggest barrier that limits Generation Z’s interest in pensions. Generation Z is the demographic cohort born roughly between the mid-to-late 1990s and the early 2010s.

More than a third (39%) of pension professionals who responded chose the option that pensions is “not a priority”, with more than a quarter (29%) citing “affordability” as the main barrier. 15% indicated that a lack of understanding/complexity was the main barrier.

Other suggestions were believed to be less likely to act as a barrier, with “lack of trust” chosen by just 3% of respondents and “better alternatives” by 2%.

Sophia Singleton, President of the Society of Pension Professionals, who chaired the event, said: “Industry needs to accurately identify any barriers to taking an interest in pensions before it can take steps to address them and encourage greater saving."

"The SPP’s industry polling reveals that more than two thirds of pension professionals believe that the biggest barrier to Generation Z having a greater interest in pensions is that it’s simply not a priority or that it’s unaffordable."

"It was interesting to note that a lack of trust or better alternatives – two reasons often put forward by commentators as reasons for younger generations not engaging, were in reality not thought to be significant barriers at all."

"The Pensions Commission is focussing on Millennials (i.e. those retiring by 2050) because they are at risk of being left behind. That’s why we need to ensure our message is getting through to future generations.”