Cost-of-living pressures continue to impact consumers’ approach to pension savings, according to the annual Financial Resilience Report published by Royal London.

Most people said their basic bills, including food and energy, had risen since last year, although housing costs saw more stability; 27 per cent said their housing costs had not increased or had fallen – this proportion stood at 21 per cent in 2024.

Two in 100 people described themselves as being in financial crisis, unable to pay their bills, a fall from 3 per cent in 2024.

Similarly, there was a small decrease in the proportion of people who said their financial resilience, in other words, their ability to cope financially with unexpected expenses or job loss, had been affected over the past 12 months.

Last year, 55 per cent of people said their resilience had been impacted, while in 2025 this fell to 50 per cent.

Despite these incremental improvements, a large, albeit decreased, proportion of all people surveyed said their retirement plans were affected by the persistently high cost-of-living.

The proportion of people who said their retirement plans had been affected fell to 43 per cent in 2025, down from 75 per cent in February 2024.

While this could be perceived as a sign that people are feeling more confident about their pensions, there are signs that it could be related to a lack of engagement.

The same report revealed that 69 per cent of people do not know the value of their pension pots and more than half (52 per cent) have not considered how much they will need in retirement.

Single people are more affected by affordability issues than those who are married or in civil partnerships, according to the report.

People living alone are paying less into their retirement savings than married couples or those in civil partnerships, with 6.2 per cent of salary going into pensions compared with 7.8 per cent for a married person or someone in a civil partnership.

Age also plays a part: Around one third (36 per cent) of people aged between 30 and 49 have considered how much money they will need to live on when they retire, and only 11 per cent have used online tools or contacted a financial adviser to help calculate their needs.

Short-term saving habits continue to indicate a wider lack of financial resilience. A fifth (20 per cent) of those surveyed said they have less than £100 in cash savings, slightly up on 19 per cent last year.

Royal London consumer finance specialist, Sarah Pennells, said: “Higher costs and bills aren’t just squeezing day-to-day budgets – they are also affecting people’s ability to save; their retirement plans and their future financial resilience.

"While some indicators show people’s finances are not as badly affected as they were in previous years, they have not recovered to the extent that we might have hoped, especially when it comes to short-term savings.”

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