Pensions are a universal part of the UK economy and have been for the last 100 years or so. As we all love to compare and contrast our finances with other people, it’s understandable that there’s a lot of curiosity around average pension pot sizes in the UK.
What’s worth keeping in mind is that the size of your pension will likely be linked to your age. More years mean more time to earn and pay into your pension through your contributions and from your employers.
So, to give you some insights into the state of UK pensions in 2024, this article will look at average pension sizes by age and provide you with some statistics and tips to make the most out of your personal pensions.
What is the average pension pot in the UK?
According to the ONS, the median pension pot size for all types of pensions is £32,700.
UK average pension pot size by region
It’s not only your age that can make a difference to average pension pot sizes; where you live in the UK can also be a factor.
Here’s what average private pension pot sizes look like when broken down by regions across the UK:
|Average pension pot
|Yorkshire & the Humber
|East of England
Average UK pension pot by age
Because 2023 has just come to a close, we don’t yet have updated figures for 2024.
It’s also difficult to look at accurate UK statistics because pensions are such a complex field. However, provider PensionBee has some useful statistics around defined contribution pensions from almost 200,000 customers as of March 2023.
So, let’s take a look at average UK pension pots up until early 2023, broken down by age.
Average pension pot by age and sex
|30 to 39
|40 to 49
|50 to 54
|55 to 64
Average pension pot under 30
As you might expect, these figures are quite low. Here’s what the average pension pots look like for those under 30:
- Male: £3,275
- Female: £2,619
Average pension pot at 30 to 40 years old
Here’s what the average UK pension pot looks like for those between 30 and 39 years of age:
- Male: £9,876
- Female: £7,779
Average pension pot at 40 to 50 years old
Here’s what the average UK pension pot looks like for those between 40 and 49 years of age:
- Male: £24,083
- Female: £17,850
Average pension pot at over 50 years old
Here’s what the average UK pension pot looks like for those over 50 years of age:
- Male: £43,954
- Female: £23,962
Average pension pot at 55, 60, 65
Here’s what the ONS says is the median average UK pension pot for the age bracket of 55 to 64:
- Male/female: £107,300
Average pension pot at 65, 70 and above
Here’s what the ONS says is the median average UK pension pot for those who are 65 and older:
- Male/female: £81,100
Overview of Pensions in the UK
After diving into the stats, it’s worth having a brief overview of UK pensions.
It’s an area often discussed and frequently changes due to political and societal changes. The main types of pensions in the UK are:
For the purpose of this guide, we’re mostly going to be looking at defined contribution (DC) pensions.
Reason being, that no one has control over what happens with the State Pension and defined benefit (DB) pensions are being phased out (and are much harder to quantify in monetary or cash terms).
A DC pension is a type of workplace or private pension that you pay into yourself to build up a retirement pot over time. It’s what your employers will set up for you with auto-enrolment and hopefully pay in a percentage of your salary themselves.
The minimum for the auto-enrolment system is 8%. Usually, this is made up of 5% from you and 3% from your employer. However, some companies will contribute more. You also get tax relief on top of these contributions.
UK Pension Statistics
Let’s take a look at some overall statistics relating to private pensions and workplace pensions in the UK.
According to the ONS, workplace pension participation rates reached 79% by April 2021, which means around 22.6 million workers are enrolled in workplace pensions.
You can see from this graph that workplace pension participation in the UK is increasing (apart from the decline in defined benefit (DB) pensions). However, this big uptick is largely due to auto-enrolment being introduced in 2012 (shown by the first grey line in the graph).
However, when it comes to private pensions, the trend has been slightly different. In the last few years, the number of members and average individual contributions has actually decreased slightly.
But this is in part due to the coronavirus pandemic, as people paused pension contributions due to economic uncertainty. You can see these recent average UK private pension trends in the graph below:
Why it’s helpful to know the average UK Pension Pot
One of the most important reasons why this information is useful is because it can help you better plan and prepare for your retirement.
Even if retirement is many years away, the steps you take today can make a huge difference to the quality of your retirement.
According to the Pensions and Lifetime Savings Association (PLSA) Retirement Living Standards, these are the yearly amounts you need to take from your retirement pot for various standards of living in retirement:
This is how much interactive investor estimates a single pensioner would need in their retirement pot to be able to meet these figures in retirement:
- Minimum lifestyle – £59,900 total pension pot
- Moderate lifestyle – £290,800 total pension pot
- Comfortable lifestyle – £598,700 total pension pot
Tips for boosting the size of your Pension Pot
Now that you’ve got a better understanding of the statistics around average pension pot sizes in the UK, here are some ways you can try and make sure you have an above-average pension when you retire:
- Start early – this may be out of your control depending on your age, but try and start saving for retirement as soon as you can.
- Open a SIPP – if you’re maxing out your workplace pension contributions, consider opening a self-invested personal pension (SIPP) as an additional retirement pot that has added flexibility.
- Consolidate your pensions – keeping all your pensions under one roof can make them easier to manage and allow you to see greater benefits from compound interest.
- Lower fees – with some workplace pensions, you can’t choose the provider. But if you can, look for one with lower fees because this will make a huge difference to the size of your pot at retirement.
- Research your investments – most people don’t look at what their pension is investing in. You can take control and aim for more growth-focused investments if you’re younger or happy to take on extra potential risk.