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Data brief: How the self-employed save for retirement

This data brief offers new national-level insights into the savings products used by the self-employed for retirement.

Introduction

Savings products

Our nationally representative survey, which included only those whose main source of income is self-employment and who earn over £10,000, now reveals that 38% are currently saving into a pension. This marks a notable improvement compared to previous national estimates. According to the Office for National Statistics (ONS), only 20% of self-employed individuals were saving into a pension between April 2018 and March 2020.⁴

Among those saving, Self-Invested Personal Pensions (SIPPs) are the most commonly used product, with 30% of the self-employed opting for this flexible, self-managed option. This reflects a continued preference for autonomy in financial planning.

Other popular vehicles include Stocks and Shares ISAs (22%) and other savings accounts (21%), which may appeal due to their accessibility and perceived control, though they lack the tax advantages of pension-specific products.

12% of respondents still contribute to a workplace pension from a former employer, indicating some continuity in saving habits post-employment. Meanwhile, seven per cent use a Lifetime ISA, and one in ten (10%) invest through other types of investment vehicles. A small proportion also reported saving via annuities (2%) or other methods (3%).

These findings highlight the diversity of saving strategies among the self-employed, but also underscore the need for clearer guidance and support to encourage pension-specific saving.

How the self-employed save for later life

Proportion of income saved

Of those currently saving for retirement, the majority are saving relatively modest amounts towards retirement.

Nearly one-third (30%) of respondents reported saving up to five per cent of their income, while a further 22% are putting aside between six and 10%. Taken together, over half (52%) of those currently saving for retirement are contributing no more than 10% of their income.

Only a small proportion are saving at higher levels: 11% contribute between 11% and 15%, just under one in ten (8%) between 16% and 20%, and just 12% save more than 20% of their income.

Notably, six per cent of respondents are saving more than 40%, indicating a small but significant group with a strong focus on retirement planning.

Concerningly, 17% of respondents indicated that they "don’t know" what proportion of their income they are saving, suggesting a lack of clarity or engagement with retirement saving among a notable minority.