Gen Z dream of retiring at 60 – but only one in ten prioritise pensions and 59% believe auto-enrolment contributions will be enough to fund their retirement

Gen Z adults (those aged between 18 – 28 years old) are at a pivotal early pensions junction, according to new research from Standard Life, with ambitious retirement aspirations driven by a digital-first, higher-risk approach, and an over-reliance on minimum auto-enrolment contributions, which could leave them at risk of de-railing their retirement hopes by taking the wrong road to saving for retirement.

Data from Standard Life’s 2025 Retirement Voice report has found that, on average, Gen Z aspire to retire at 60 – earlier than any other generation, and well before today’s State Pension age of 66 (currently set to rise to at least 68 by the time Gen Z retire) – however only one in eight (13%) of Gen Z say pension saving is one of their biggest financial priorities. Furthermore, 59% believe that simply being auto-enrolled into a workplace pension means they are saving enough for retirement.

Digital instincts and risk-taking shaping attitudes to pension saving

Having grown up in a digital-first world, Gen Z’s financial outlook is instead increasingly shaped by social media, AI and alternative investments. A quarter (25% vs 21% overall) are investing in stocks and shares, while one in four (25% vs 12% overall) have invested in crypto. Nearly a fifth (19%) turn to AI for retirement planning advice, and more than one in five (22%) use social media influencers – this is significantly higher than the averages across all age groups, where 8% say they use AI and 9% consult social media.  

This appetite for risk is also markedly different from older generations: nearly half (48%) of Gen Z say they are comfortable taking risks for higher returns, compared with 24% of Gen X and just 14% of Baby Boomers. While this risk tolerance could be an advantage with decades of saving ahead, it also highlights the need for trusted guidance and advice to help navigate potentially volatile and unregulated investments.

A reliance on auto-enrolment

One area where Gen Z have a clear advantage is auto-enrolment which may also go some way to explaining why only 13% prioritise pension saving. Introduced in 2012, it has been in place for their entire working lives – starting from the age of 22, when eligibility begins – and only 8% say they have opted out. However, it is clear that this is leading to a false sense of security, with a sizeable 59% of Gen Z believing that simply being auto-enrolled means they are saving enough for retirement. In reality, around four in ten working-age people are under-saving, and for those aiming for a comfortable retirement, relying on minimum auto-enrolment contributions alone is unlikely to be enough. 

Living in the here and now 

Instead, more than a third (35%) admit they would rather “live for today than plan for tomorrow”. Their financial priorities focus instead on immediate needs: managing day-to-day finances (30%) followed by saving for holidays (30%), property (29%), or building an emergency ‘rainy day’ savings fund (25%). This is not surprising given that most say they are only coping (44%) or finding it difficult (28%) on their current income. However with hopes of retiring at 60 and average life expectancy stretching into the late 80s, Gen Z may need to fund more than 25 years of retirement – significantly longer than previous generations. 

The good news is they have time on their side – giving them real potential to build healthy pension pots by increasing their contributions by even a relatively small amount. Standard Life’s analysis highlights that those who begin working on a salary of £25,000 per year and pay the minimum monthly auto-enrolment contributions of 8% from the age of 22 could have a total retirement fund of £210,000 by the age of 68, adjusted for 2% inflation³. However, someone who increased their employee contribution by just 2%, reaching 10% overall from the start of their career, could save £262,000 in today’s prices – £52,000 more, thanks to the potential for many decades of compound investment growth.

*assuming 3.50% salary growth per year, and 5% a year investment growth. Figures are reduced to take effect 2% inflation. Annual Management Charge of 0.75% assumed. The figures are an illustration and are not guaranteed. Earning limits not applied. 

Catherine Foot, Director of the Standard Life Centre for the Future of Retirement, commented: “Gen Z are at the start of their financial lives and are understandably aiming high – with ambitions to retire at 60, earlier than any other generation. However although they do have the benefit of time, our Retirement Voice research shows a clear challenge: their aspirations and approach to saving might not match the financial realities ahead. It’s no surprise that short-term goals like holidays and getting on the property ladder feel more urgent than prioritising pension saving, but the danger is that longer-term planning slips too far down the list and by relying on minimum auto-enrolment contributions, many are at risk of falling short in later life.

“Shaped by a digital-first world, Gen Z also bring a fresh perspective to saving and investing. Influenced by social media, AI, the benefits of investing, and new asset classes like crypto, they are more open to risk and innovation than previous generations. That energy creates real opportunities – but it also underlines the importance of trusted, accessible guidance to help them cut through volatility and avoid possible unexpected pitfalls, and it’s important not to ignore the benefits of pension saving alongside this. 

“The encouraging truth is that time is firmly on their side: even small increases in contributions today can translate into a step-change in retirement outcomes. But to close the gap between hopes and reality, the pensions system must evolve with them – delivering advice and support that feels relevant, engaging, and aligned to modern careers and financial behaviours. Gen Z are standing at a pivotal crossroads. With the right tools, planning and encouragement, many will be able to turn ambition into action – and build the secure, independent retirement they aspire to.”