Freetrade Research: 80% of Over-55s Unaware of Expected Retirement Income

New data from Freetrade reveals a significant knowledge deficit in the UK retirement market, with only 21% of people over 55 understanding their projected pension income. For fintech professionals, this disconnect highlights a critical failure in financial education and a massive opportunity for platforms that can simplify complex policy changes like the triple lock.

What was announced

A study of 2,000 UK adults conducted by the investment platform Freetrade has highlighted widespread confusion regarding retirement planning and state support. Only 45% of respondents correctly understood the mechanics of the State Pension triple lock, while 20% admitted they did not know how it worked at all. Misconceptions are prevalent; 11% of those surveyed incorrectly believed that every citizen is guaranteed three distinct retirement income streams: the State Pension, a workplace pension, and private savings. Even among those closest to retirement age, the knowledge gap remains wide, with 35% of over-55s unable to explain the triple lock’s operation.

This lack of clarity translates directly into financial insecurity. Only 18% of the general population—and just 21% of those over 55—claim to know even roughly what their pension is on track to pay them. Consequently, 39% of over-55s and 51% of those aged 45-54 feel unprepared for life after work. These findings arrive as the UK government confirms significant shifts in pension policy. The triple lock is scheduled for adjustment from April 2030, pending the next election, while unused pension pots will become subject to inheritance tax starting in April 2027. The research suggests that without better tools for tracking old workplace pensions and forecasting state benefits, millions of Britons are planning for a retirement they do not fully comprehend.

“The triple lock has become one of Britain’s most fiercely debated policies, but the real pension focus should be elsewhere. Millions of Britons, including those just a few years from retirement, are planning around an income they don’t fully understand. Pension policies are always open to change, and no one can say with certainty what the rules will be in 10 or 20 years, or even what the retirement age will be. What people can control is their own planning and saving. Checking your State Pension forecast and tracking down old workplace pensions is the best place to start, which the new Pension Dashboard should be able to help with. Once you know where you stand, it becomes much easier to see whether you need to do more. You don’t need large sums to make a difference. Small, regular contributions to a workplace or personal pension add up over time, and can give you a retirement plan that doesn’t hinge on the next political promise.”

Luke Kosky, Policy Lead, Freetrade

The companies involved

Freetrade is a prominent UK-based investment platform that has positioned itself as a low-cost alternative to traditional brokerage firms. Now a subsidiary of IG Group, the company has undergone significant evolution since its inception, moving from a challenger startup to a major player in the retail investment space. Its primary offering centers on a mobile-first experience that allows users to trade stocks, ETFs, and manage Self-Invested Personal Pensions (SIPPs) with a focus on accessibility and transparency. The platform operates in a highly competitive market, contending with both legacy wealth managers and a new wave of neo-brokers. By targeting a younger demographic and those previously excluded from the stock market, Freetrade has built a substantial user base. Its parent company, IG Group, provides a robust corporate backbone, bringing decades of experience in the financial derivatives and trading sectors. This relationship allows Freetrade to leverage broader institutional resources while maintaining its brand identity as a consumer-centric fintech disruptor. The company’s focus on pension data reflects a broader industry trend where retail platforms are increasingly looking to capture long-term retirement assets rather than just short-term trading volume.

What FF News has reported before

FF News has tracked Freetrade’s research into consumer behavior across various demographics. The publication previously covered how UK Teens Spend £55.5M on 'Get Rich Quick' Social Media Content: Freetrade Research, highlighting the risks of misinformation among younger investors. Additionally, FF News reported on the seasonal pressures facing retail investors in Gen Z and Millennials Risk Long-Term Wealth by Selling Investments for Summer Spending. These reports underscore a recurring theme in Freetrade’s data: a significant portion of the UK population lacks the long-term financial literacy required to navigate complex economic shifts. This ongoing research highlights the persistent gap between market access and financial understanding.

What this means

This data exposes a massive "advice gap" that the UK fintech sector has yet to bridge. While platforms have successfully democratized access to the markets, they have clearly struggled to democratize understanding. The fact that nearly 40% of those on the cusp of retirement feel unprepared suggests that the current digital-first tools are not providing the clarity users need. As the government prepares to adjust the triple lock and tax unused pensions, the pressure on wealth-tech firms to move beyond simple execution and toward proactive, automated education will intensify. The industry must decide if it will remain a set of pipes for transactions or evolve into a genuine advisory partner that can demystify political volatility for the average saver.