The 2025 Underpensioned Report, published by now:pensions in partnership with the Pensions Policy Institute (PPI) highlights that carers remain among the most financially disadvantaged groups in the UK when it comes to retirement savings.
The 2025 Underpensioned Report reveals the average pension income for a carer has fallen to 49% of the national average. This is down from 55% in 2020 highlighting a widening savings gap. Carers are retiring with 80% of the UK average private pension income (£6,750 vs £8,500), placing them among the most underpensioned groups in the UK.
Carers are also less likely to be in paid work, with an employment rate of 61% compared to 76% of the general population. They are also more likely to work part-time — particularly female carers, 38% of whom are in part-time roles, compared to just 29% of working women overall.
A call for fairer pensions for carers
To help close the pension savings gap, now:pensions is proposing key policy reforms. These include:
• Introducing a family carer’s top-up, which would ensure pension contributions continue during periods of unpaid care.
• Removing the £10,000 auto enrolment earnings trigger to ensure more carers in part-time work are included in auto enrolment.
• Scrap the lower earnings limit on pension contributions to make every pound earned count towards pension savings.
On average, carers earn £35,248 annually, below the population average of £38,740, but earnings differ significantly by gender. Male carers earn £46,681 on average, while female carers earn £28,176.
While 10.8% of employees across the workforce are ineligible for automatic enrolment (they don’t meet the £10,000 earning trigger), that figure rises to 13% among carers — and 14.6% for women carers. These figures highlight how unpaid caring responsibilities can have a lasting impact on future financial security and as a result, many miss out entirely on saving into a pension through their job.
The problem is even more striking for those in receipt of Carer’s Allowance. According to Labour Force Survey data, just a quarter of carers receiving Carer’s Allowance are eligible for auto-enrolment, with a staggering 75% missing out.
Samantha Gould, Head of PR and Campaigns at now:pensions and author of the report, commented: “Carers provide essential support that many depend on every day, yet they remain systemically disadvantaged in their ability to save for later life. We urgently need pension reform that acknowledges and supports the vital unpaid work that carers do to help provide greater financial security in retirement.”
Helen Walker, Chief Executive of Carers UK, said: "It's really worrying to see the employment rate of unpaid carers dropping. We know from our work with unpaid carers that they work below their potential, taking less senior roles or lower paid jobs. Working part-time or falling out of work completely can be catastrophic for unpaid carers' finances in the short term and can leave a lasting negative imprint on their pensions in the future. Having a carer friendly employer can make the difference between carers staying in and leaving work. Carers Week is a great time to show employees who are unpaid carers that they matter; share supportive policies, consider moving towards paid Carer's Leave and other measures to help unpaid carers in the workplace. With longer working lives and an ageing population, supporting unpaid carers in the workplace is becoming ever more important and we hope that people will join us in celebrating the theme of Carers Week this year, Caring about Equality."
The most recent Census in 2021 found that there are 5.8 million unpaid carers in the UK and 1.7 million people in the UK are providing 50 or more hours of care per week. The report reveals that although some progress has been made in employment rates among carers since 2022, they still fall behind the general population when it comes to private pension savings
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