People with disabilities have a pension wealth just 36% of the average UK pension

  • Research reveals one in six people with a disability in employment are ineligible for a workplace pension
  • There are over 4 million disabled workers in the UK, but only 54% are saving into a pension
  • Average pension wealth for those who are eligible for a workplace pension is just £47,980
  • More disabled people are working than ever (53%), however this is still significantly lower than non-disabled people (82%).

New research commissioned by NOW: Pensions, a UK Pension Provider for almost 2 million people, has found that people with disabilities face huge barriers to pensions saving, resulting in a private pension pot just 36% of the UK average.

The research by the Pensions Policy Institute (PPI) published today reveals that people with a disability who are approaching retirement age (age 60-64) have £47,980 average pension wealth compared to the average UK pot size of £130,928, a difference of almost £83,000.

There are currently, just over 4 million disabled workers in the UK yet there is still a high level of unemployment among disabled people. They are more than twice as likely to be unemployed as non-disabled people and even those who can work are often limited by the amount and type of work they can do and can be trapped in low-paying or part-time jobs.

The high prevalence of part-time work means that many are excluded from automatic enrolment.

Almost a third of people with disabilities work part-time (28%) compared to the non-disabled population of 20%. The issue with working part-time is that workers might not meet the minimum earnings threshold of £10,000.

An employee is only enrolled in a workplace pension scheme once they earn over £10,000 a year in a single job. Even those earning more than the £10,000 threshold in a job and enrolled still miss out on potentially significant contributions from each of their employments due to the Lower Earnings Limit.[1] The lower limit is set at £6,396 meaning that only earnings over that amount are pensionable. Instead of saving 8% into a pension, those earning £10,000 are only contributing 3.6% of that total figure, meaning they are missing out on crucial employer contributions.

Disabled people who are eligible for auto enrolment have marginally higher participation rates than non-disabled employees.

83% of eligible disabled workers participate in auto enrolment schemes, which is 2.9 million people compared to 80% of non-disabled eligible employees. However, because they’re less likely to meet the qualifying criteria (approximately 15%, or 500,000 disabled people in work don’t qualify) as a group they still benefit less overall from automatic enrolment compared to non-disabled people.

However, people with disabilities are the only group for whom the average income from State Pension and benefits tops up private pension savings to a level equal to that of the baseline population.

The disabled employment gap

The government aims to see one million more disabled people in work between 2017 and 2027 and is committed to reducing the gap between the employment rates of disabled and non-disabled people – known as the disability employment gap.

Disabled people are almost twice as likely to be unemployed as non-disabled people, and three times as likely to be economically inactive.

Although we’re seeing the government’s goal having a positive impact on employment rates, under the current automatic enrolment legislation many are still missing out, as many work part time and earn under the earnings threshold of £10,000.

Cost of living

According to the charity Scope, life costs you on average £583 more a month if you’re disabled and families of disabled children face, on average, extra costs of £581 a month. For almost a quarter (24%) of families with disabled children, extra costs amount to over £1,000 a month.

This means there is even less chance for them to save, which is why we’re lobbying to make sure everyone can benefit from auto enrolment.

Joanne Segars OBE, Chair of Trustees at NOW: Pensions:

“People with disabilities are one of the underpensioned groups that we have been campaigning on behalf of for some time. We believe it is imperative that we continue to raise awareness of the discrimination that many people go through which has a huge impact on the ability of people to save for their later life. We want to make pension saving fairer for everybody in the UK and our policy proposal to remove the £10,000 earnings threshold would help get a further 500,000 disabled people saving for their retirement.”

Laurie Edmans CBE, Financial Inclusion Commission and Co-Chair, GAIN – Group for Autism, Insurance, Investment and Neurodiversity:

At GAIN, we are pleased to support NOW: Pensions showing, so clearly, the financial disadvantages faced by disabled people.  GAIN is campaigning for a radical improvement in the employment prospects of Neurodiverse people, many of whom – like people with non-visible disabilities – face very similar employment challenges to those with physical disabilities. In the time of ‘the great resignation’ both are a waste of talent so urgently needed by employers as well as being unfair to individuals.”

Johnny Timpson OBE, Disability Awareness Champion:

“As a Financial Inclusion Commissioner, former Cabinet Office Disability and Access Ambassador, and a person with a disability, I thank and commend NOW: Pensions for this UK disability and pensions wake-up call … With 1 in 5 consumers living and working with visible and/or non-visible disabilities, our number increasing as our society ages, I hold that it is absolutely essential that together with gender and ethnicity employment, pay and pension gap reporting, we should now transparently report on, and close, our UK disability employment, pay and pensions gaps.

“I encourage all employers to embrace board and workplace inclusion plus, and importantly, the social model of disability, and remove the barriers that people with disabilities all too often accessing communications, tools, products, services and careers as in doing so, you remove barriers and improve access for all. 

“Additionally, I urge employers, and particularly financial services firms, to join the Disability Confident Scheme and raise employee awareness of both the Access To Work support plus welfare benefits and grants that may be entitled to.”

Find out more about NOW: Pensions’ mission to fight for Fair Pensions For All.


[1] The first £6,396 is deducted from any pension contribution in auto enrolment, meaning that their total contributions (employer and employee) are 8% of the remaining £3,604.


More information

Samantha Gould – NOW: Pensions

Instinctif Partners

NOW: Pensions policy proposals

  1. Removal of the £10,000 auto-enrolment trigger to get more saving into workplace pensions
    By removing the £10,000 AE trigger, we would get a further 500,000 disabled people saving into a workplace pension
  2. Auto-enrolment contributions on every pound of earnings
    If we were to start pension contributions from the very first pound of earnings, we would increase pension wealth by 36% at retirement.

These simple steps could help carers catch up on pension saving and secure a fairer financial future. Find out more about our campaign for fair pensions for all.