More than half of UK pension savers prefer UK investments

27 March 2025

More than half of UK savers would rather see their pension money invested at home, according to new research from the Pensions and Lifetime Savings Association (PLSA). 

The study found that 53% of savers want their pensions invested in the UK, with 37% supporting this idea as long as returns remain competitive. Interestingly, 16% would still prioritise UK investments even if it meant lower returns.

Zoe Alexander, director of policy and advocacy at the PLSA, highlighted how striking it is that so many savers are keen on UK-based investments. She noted: “Pension schemes are already thinking hard about how to invest more in the UK in ways that will deliver strong returns.”

She stressed that by working together, the government and the pensions industry can ensure investments support both savers' financial futures and the UK economy’s sustainable growth.

Pensions Minister calls for more investment in Britain 

The research follows a speech made by Pensions Minister Torsten Bell at a PLSA investment conference in Edinburgh earlier this month, where he warned that Britain must start investing in its own future again. 

Bell highlighted how the biggest UK pension schemes could be doing more to put money into the UK economy, much like other countries do. For example, UK defined contribution pension funds currently invest just 3% in infrastructure and only 0.5% in private equity. That’s much lower than places like Canada, where infrastructure makes up 11% of pension investments, or Australia, where private equity gets a 5% share.

He said: “If you want a summary of this government’s economic strategy, this is it. It’s time for Britain to start investing in its future again, and this shift in investing in a wider range of assets.”

A mixed attitude to green investments

While the impact of climate change remains a major concern for 70% of savers, the findings show that their investment priorities are mixed. 

Only 19% of DC savers would definitely accept lower returns in favour of greener investments. However, a further 50% said they might consider it if the environmental impact was significant, whilst 31% prioritise financial performance over sustainability.

Lack of awareness about where pension savings invested 

The PLSA research also revealed that many people lack awareness about where their pension money actually goes. While 74% of UK workers know that their pensions are invested, only around a quarter of defined contribution (23%) and defined benefit (25%) savers know the specific details of their investments.

The report also reveals that:

• 63% are unsure whether their pensions support UK businesses or infrastructure projects. 

• 13% are confident that their pensions include UK investments.

• 24% believe they include UK investments but aren’t certain.

This lack of awareness extends to decision-making, with just 37% of defined contribution savers feeling they have the knowledge and skills to choose their own pension investments. The same proportion (37%) admitted they do not feel equipped to make these choices. 

The PLSA is calling on pension providers and the government to improve financial education so savers can better understand their options.

Source

PLSA research: Half of pension savers prefer UK investment. FT Adviser. Accessed 20 March 2025.