Three quarters of UK workers willing to cut spending now to retire five years sooner
Three out of four workers are willing to cut back spending now if it means they can afford to retire five years sooner, according to new research from Aegon, one of Britain's largest pension providers managing over £240 billion in assets for approximately 3.7 million customers.
Nearly a third say they would give up luxury purchases, while around a quarter would either order fewer takeaways, eat out less frequently or make fewer trips to the pub.
But only around one in six working adults would downsize their home to free up cash for early retirement. Research from Audley Villages shows that just 14% of people aged 55 and over are actively considering downsizing, despite the potential financial gains. Analysis by Savills suggests downsizers could unlock an average of £305,090 by moving from a four-bedroom to a two-bedroom home, potentially providing a tax-free income of approximately £1,218 per month for the rest of their lives.
Aegon believes the findings show people are more inclined to make easier and smaller everyday economies than larger, structural changes to their finances that could have a greater impact on retirement plans.
The drive towards early retirement
The research found early retirement is usually most closely associated with having more time for hobbies, interests and travel, or spending more time with family and friends. But around a third felt what early retirement means is reaching the point where work becomes a choice rather than a necessity.
This suggests retirement is increasingly being viewed as a state of financial freedom rather than a fixed end to working life, according to Aegon. The findings come as the UK state pension age is rising from 66 to 67, with the increase beginning on 6 April 2026 and phasing in gradually through to March 2028, affecting everyone born between 6 March 1961 and 5 April 1977.
The desire for early retirement stands in contrast to current trends. The number of people working into their 70s in the UK has doubled in the past decade, and Department for Work and Pensions figures published in September 2026 show the average actual retirement age has reached record levels: 65.8 for men and 65.1 for women.
The research also asked people what aspect of modern life they would like to retire from tomorrow. Some 29% said household chores, and 26% commuting, but 20% said social media, something that is typically optional and that most people pursue in leisure hours.
The pension savings challenge
The willingness to make sacrifices may reflect growing awareness of retirement funding pressures. Approximately 43% of working-age Britons, around 14.6 million people, are currently undersaving for retirement according to DWP analysis.
According to the Pensions and Lifetime Savings Association, a single person requires an annual income of around £45,400 to achieve a comfortable standard of living in retirement, leaving a gap of over £32,000 when compared to the full state pension of £12,548 per year in 2026/27.
There is also a significant gender dimension to retirement savings. A 48% gender pension gap exists among UK adults aged 55-59, with women holding median private pension wealth of £81,000 compared to £156,000 for men.
On a more positive note, auto-enrolment workplace pensions have added approximately 11.4 million pension savers since the scheme was introduced in October 2012, with 89% of eligible employees in Great Britain now saving into workplace pensions, an estimated 21.7 million people.
Aegon surveyed 2,000 adults who are still working and otherwise weighted to be representative of the UK population as part of its Money:Mindshift initiative, which explores how people think and feel about money.
Dr Tom Mathar, head of Money:Mindshift at Aegon, says the research reveals the complex trade-offs people face.
Ultimately, retirement planning isn't just a calculation about money. People are balancing multiple currencies at once, including their time, health, relationships, sense of purpose and financial security.
He adds:
Why give up holidays, meals out or trips to the pub now to create a future where you hope to have more opportunities to enjoy life? It may sound like a contradiction, but many of us make choices like this when we're weighing up today's spending against tomorrow's goals.
What people appear to want to escape from is the friction that comes with modern living. Chores, commuting, admin and endless demands on our attention all feature prominently in these results.
