"Sapa" is now chasing UK Gen Z too as young workers dump pensions to survive today's bills

Precious Omolu 12:24 - 02 October 2026

Young workers in the UK rethink workplace pension savings as rising living costs squeeze their finances

Young workers in the UK are opting out of workplace pension schemes as the rising cost of living forces them to focus on rent, bills and survival instead of retirement savings.

Young workers in the UK are increasingly opting out of workplace pension schemes because of the rising cost of living.
A trainee doctor said he stopped paying £430 monthly into his pension to cover family responsibilities, rent and other expenses.
The UK government warned that many young people could retire with lower private pension income if the trend continues.
Financial experts say opting out also means losing employer contributions and years of compound investment growth.

For many young people, retirement feels like a problem for another day. Right now, paying rent, buying food and staying afloat matters more.

That reality is becoming more common in the UK, where a growing number of Gen Z and millennials are opting out of workplace pension schemes because the cost of living has become too much to handle.

According to the BBC, many young workers are choosing immediate financial relief over long-term retirement savings, despite warnings that the decision could leave them with less money when they eventually retire.

"A growing number of Gen Z and millennials are opting out of these schemes due to cost-of-living pressures and the government has warned they could be on track for lower private pension incomes than people retiring today," the report read.

One of those workers is 26-year-old Hassan Nassar, a trainee doctor in England. He stopped contributing around £430 every month to his NHS workplace pension in September.

For Nassar, the decision wasn't because he doesn't believe in saving for retirement. He simply has more urgent responsibilities. He said he needed the extra money to support a sick family member, save towards buying his first home, pay rent and keep up with student loan repayments.

Hassan Nassar said he opted out of his NHS workplace pension to support a sick family member and manage rising expenses.

He estimates that opting out now could reduce his future retirement income by between £5,000 and £10,000 because he'll miss out on years of compound growth.

"People will say, you’re silly, look at what you’ll be missing out in the future. But I need to look at what I’d be losing now if I didn’t opt out," he told the BBC.

Another young worker, 22-year-old Evie from Cornwall, also decided to stop paying into her workplace pension.

She explained that balancing rent, transport, food expenses and saving for a house and car had become almost impossible.

"How can I save for a house, how can I save for a car and afford my outgoings? I don’t want to just work day in, day out to live, I want to work to have a life," she said.

The situation has raised concerns among UK officials. While most workers qualify for the State Pension, it only provides a basic income after retirement. Many people depend on workplace and private pensions to maintain a comfortable lifestyle later in life.

Figures from the UK's Department for Work and Pensions show that around 22.6 million eligible workers, about 90%, are still enrolled in workplace pension schemes. However, roughly 2.5 million eligible workers are currently not contributing.

Pensions Minister Torsten Bell warned that many younger workers are not putting away enough money for retirement.

UK Pensions Minister Torsten Bell warned that many young workers could retire with lower private pension incomes if the trend continued.

"There is a danger tomorrow’s retirees are on track for lower private pension incomes than today’s," he said.

Financial adviser April Leeson also urged young workers to think carefully before opting out. She noted that stopping pension contributions doesn't only reduce personal savings, it also means losing employer contributions and decades of compound investment growth.

Experts say money invested in a pension during a person's 20s has the longest time to grow, making early contributions some of the most valuable for building retirement wealth.

The story highlights a growing reality many young workers around the world, including in Nigeria, can relate to: when today's bills keep rising, planning for life decades ahead often becomes a luxury.