One in ten workers under 30 (9.3%) entitled to join an auto-enrolment pension scheme are opting out, according to new research.
The cost of living crisis has led to 500,000 people opting out of their auto-enrolment pension payments a year, according to the report from Lubbock Fine Wealth Management which submitted a Freedom of Information request to the DWP.
A similar number of Millennials (9.4% of eligible workers age 30 to 40) also opted out last year.
Andrew Tricker, Chartered Financial Planner at Lubbock Fine Wealth Management, said: “It’s a real concern that so many younger people are opting out of auto-enrolment. The maths shows that if you want to build up a healthy pension pot you should invest from as early an age as possible.
“Many young people are living on such a tight budget that skipping that auto enrolment contribution seems like the only way to make ends meet.
“They have student debt to pay back, the pressure to build up a deposit for their first home and the cost-of-living crisis. It is not surprising they aren’t saving for a date that is 30 years away.”
Separate research from Chetwood bank has found that two in five Britons would struggle to cover an unexpected £300 bill, rising to 45% among women.
Over half (55%) of the 1,000 UK adults surveyed in March have changed their savings or financial plans due to rising living costs. That figure was highest among respondents from Wales (71%) and London (64%).
The most recent auto-enrolment data was shared with Lubbock Fine Wealth Management by the Department for Work & Pensions under the Freedom of Information act.