Financial independence is out of reach for millions in the UK

New research reveals that some working-age adults feel unable to save or plan with confidence for the future

Financial independence, the ability to cover expenses, save, and plan for retirement without relying on others, remains an elusive goal for millions in the UK. It reflects not only day‑to‑day stability but also the capacity to build resilience for the future, yet many households still find it out of reach.

According to a recent report, one in four working‑age adults, around 5.7 million people, believes they will never achieve it; this represents a quarter of the UK working‑age population. This highlights a widespread lack of confidence in long‑term financial security and underscores the scale of the challenge for individuals trying to balance current costs with future planning.

Understanding what independence means

The study describes financial independence using key indicators such as being debt-free, having adequate emergency savings, and comfortably covering daily expenses. Over half (56%) of respondents linked it to debt clearance, while 51% considered having an emergency fund essential.

Nearly two in five (37%) admitted they wouldn’t be able to manage an unexpected expense without borrowing, and a third (33%) said they had no disposable income left at the end of each month.

These findings highlight the strong link between daily financial pressures and long-term security. Without extra income to save or invest, many households find it difficult to plan for the future, a situation that has become more evident as the rising cost of living continues to strain budgets across the UK.

Retirement saving remains a key obstacle

For many, the greatest obstacle to achieving financial independence is the inability to save for retirement. Over a third (35%) of respondents reported not saving enough for later life, while 15% admitted they hadn’t started saving at all and had no plans to do so. This lack of preparation could exacerbate future inequality, especially among younger and lower-income workers.

The report estimates that over 15 million people are currently at risk of poverty in retirement. While automatic enrolment has encouraged millions to start saving, contribution levels remain too low for many to achieve a comfortable standard of living.

The report highlights that broader reforms, including lowering the auto-enrolment age from 22 to 18 and removing the £10,000 earnings threshold, could enable younger, part-time, and self-employed workers to join the system earlier.

Groups most affected by financial insecurity

Financial independence varies significantly among different age groups. Generation Z, those in their 20s, report the lowest confidence levels, with nearly one in three (32%) saying they do not feel financially independent. Among people in their 50s, that figure drops to 24%.

The research also found that renters (34%) and people with disabilities (45%) are particularly vulnerable to financial instability, often facing higher living costs and limited access to affordable credit or housing.

This disparity emphasises how structural factors, from wage growth to rental market pressures, influence people’s ability to plan ahead. It also highlights the importance of considering pension saving as part of a broader financial picture that includes debt management, emergency savings, and housing security.

Link between empowerment and action

Research suggests that feeling financially independent is often the first step towards becoming financially empowered. When people believe they have control over their finances, they are far more likely to engage with long-term planning and take proactive steps to improve their situation.

However, many face competing challenges that make it hard to prioritise saving for the future over immediate financial pressures. True empowerment requires more than pension reform alone. It relies on ensuring that people understand how much they’ll need in retirement, how their current savings compare with that goal, and what adjustments can help them reach it.

Greater access to financial education, employer support, and intuitive digital tools could all help close the confidence gap and encourage more consistent saving habits.

Call for targeted policy reform

As the government continues its Pensions Review, the findings offer timely evidence for reform. Broadening auto-enrolment eligibility and assisting lower-income savers could greatly enhance long-term outcomes. More inclusive measures would ensure that financial independence and the security it provides are accessible to more than just the wealthier.

With millions still struggling to save or plan effectively, the message is clear: empowering people to take control of their money must begin well before retirement nears.

Concerned about your or your children’s long-term financial independence?

We can assist you in evaluating your current circumstances or those of your children and in creating a clear plan to secure lasting financial stability. Timing is crucial, so beginning the process earlier offers more benefits. To find out more, please contact us.

INVESTMENTS CAN GO DOWN AS WELL AS UP. YOUR CAPITAL IS AT RISK. TAX TREATMENT DEPENDS ON INDIVIDUAL CIRCUMSTANCES AND MAY CHANGE IN THE FUTURE. THIS ARTICLE DOES NOT CONSTITUTE FINANCIAL ADVICE. A PENSION IS A LONG-TERM INVESTMENT NOT NORMALLY ACCESSIBLE UNTIL AGE 55 (57 FROM APRIL 2028 UNLESS THE PLAN HAS A PROTECTED PENSION AGE). THE VALUE OF YOUR INVESTMENTS (AND ANY INCOME FROM THEM) CAN GO DOWN AS WELL AS UP WHICH WOULD HAVE AN IMPACT ON LEVEL OF PENSION BENEFITS AVAILABLE.

Source data:

[1] Scottish Widows – 2025 Retirement Report: Financial Independence Findings: https://www.scottishwidows.co.uk/about-us/media-centre/press-releases/financial-independence-out-of-reach.html