26 March 2026
The Financial Resources Survey
The Financial Resources Survey highlights how little financial headroom many households have. Almost half of families hold £1,500 or less in savings, including 18% with no savings and another 9% with under £100. These numbers leave families highly exposed to routine financial shocks, so building resilience has to start with small, regular contributions. Automating a modest transfer into a separate pot each month as soon as you get paid creates a level of consistency that is difficult to achieve when budgets feel unpredictable.
Unsurprisingly, investment participation also remains weak. Only 8% of adults hold stocks or shares, and engagement rises meaningfully only in older age groups. That does not sit comfortably with the current policy direction. The government wants households to engage more confidently with investing and direct a greater share of savings towards long‑term assets. The reduction in the cash ISA limit from April 2027 is intended to encourage that shift, but without a stronger foundation in financial understanding many people may simply save less rather than redirect money into investments. Clearer guidance on how to build an emergency buffer, how ISAs and pensions work, and how small contributions compound over time would help people make better long‑term decisions and build up their financial resilience rather than making wholesale changes to ISA policy.
The survey shows in black and white how much care responsibilities add even more pressure to finances. Eight in every 100 people provide informal care, with the highest rates among those aged 55 to 64. These years would often be at a time when savings and pension contributions are building the most, yet caring duties frequently reduce working hours and interrupt contributions. For those, with significant caring responsibilities when circumstances allow, rebuilding contributions and using available allowances can help restore momentum so people can continue to build a retirement that they aspire to.
Pensioners’ Income Series
The latest Pensioners’ Incomes figures show that incomes have been broadly stable despite skyrocketing inflation over the period. Average weekly income after housing costs sits at £455, compared with £443 in FYE 2022, which suggests that income growth in real terms has been subdued, which given the high levels of inflation we have suffered is cause for worry as more income gets swallowed by everyday expenses. With energy prices set to increase in the near term this could put a significant strain on pensioner's finances.
The figures show that auto enrolment has genuinely reshaped behaviour among employees, pushing workplace participation to around 80% from nearer 60% a decade ago. It has become the backbone of retirement saving for millions of workers, and other data has already shown just how many extra people are now in schemes as a result. While it has done an excellent job, it needs to evolve to improve how much people are putting away.
While auto-enrolment has done a decent job of getting people saving the self employed have been left out of the picture. Only about one in five are contributing to a pension, and the gap is widest at the point when saving matters most. While almost 9 in 10 employed 45–54‑year‑olds are in a pension, only around a quarter of self‑employed people of the same age are saving in this way. Previous datasets have already painted a bleak picture for this group, and the latest FRS suggests the structural gap is still very much there. Without the nudge of auto enrolment or employer contributions, the onus is entirely on the individual. In practice, that means keeping contributions as simple and predictable as possible: setting up a standing order into a personal pension, increasing contributions in good months rather than stopping in bad ones, and making full use of tax relief so each pound of contribution works harder.
The gender gap is clear in the breakdown of income sources. For single pensioners, benefit income accounts for 52% of total gross income for men and 62% for women. Occupational pension income contributes 26% for single men and 23% for single women, while earnings account for 9% of men’s income and 6% of women’s. These differences reflect lifetime labour patterns, which continue to be entrenched and result in persistently lower incomes for many women in retirement. For any couples these statistics should be a wake up call to ensure that pension contributions are maintained during periods out of work.
Pensioners under 75 have average weekly incomes of £502, compared with £417 for those aged 75 or above. Benefit income makes up 41% of total gross income for the younger group but rises to 54% among older pensioners. The shift reflects the fact that older retirees have fewer opportunities to supplement their income through work and are more reliant on the State Pension and fixed private pension arrangements. As we live longer these differences are only set to get starker. For younger generations the message needs to be to plan for a retirement that could span decades and for part of it to potentially be in ill health requiring care. Starting as early as possible and giving your retirement pot plenty of time to compound is usually the best course of action.
