A significant proportion of UK workers are navigating their finances without a long-term plan, risking poorer outcomes in later life, according to new research from Fidelity International (‘Fidelity’).
The latest findings from Fidelity’s Global Sentiment Survey, which captures the views of over 38,000 working adults globally, highlight a mismatch between employees’ financial priorities and their planning horizons.
Short-term focus leaves long-term gap
When asked how far ahead they plan their finances, almost two-thirds (64%) of UK workers don’t have a financial plan beyond the next 12 months – including a fifth (21%) who say they only plan for the next few weeks or less. Two-fifths (43%) only plan months ahead.
Despite this short-term focus, workers recognise the importance of addressing their longer-term financial needs. Four in ten (40%) say that increasing their savings and investments is their most pressing financial need.
The findings point to an opportunity for employers and providers to support employees in building more structured financial plans.
“Having a clear financial plan can help people feel more in control of their money, provide greater confidence in decision-making, and improve overall financial wellbeing. Yet for many, knowing where to start – particularly when balancing short-term pressures with long-term goals – remains a challenge.
“Putting a plan in place doesn’t need to be complex, but it can make a meaningful difference – helping people feel more in control, make better-informed decisions, and feel more confident about their future.”
Daniel Smith, Head of Workplace Investing Distribution at Fidelity International
Workers turn to AI for financial support
UK workers are increasingly open to using digital tools, including artificial intelligence, to help address this gap.
Almost two-thirds (64%) say they would, or already do, use AI to understand how much they will need in retirement. More than half would consider using AI to support investment decisions within their workplace pension (54%) or to help with budgeting and short-term financial planning (52%).
However, the research also highlights the continued importance of human interaction. In the past six months, 13% of UK working adults have spoken to a financial adviser – rising to around a fifth among those in their 20s (21%) and 30s (18%) – suggesting that while digital tools can play a powerful role, many employees still value the reassurance and personalised guidance that comes from speaking to a person.
The role of employers
Against this backdrop, employers are well-positioned to help employees bridge the gap between short-term financial management and long-term planning.
Daniel Smith continues:
“Many employees are understandably focused on managing their day-to-day finances, but our research shows that this can come at the expense of longer-term planning.
“What’s clear is that there is no ‘one-size-fits-all’ answer. Digital tools, including those powered by AI, have an important role to play in helping employees understand their financial position and model different scenarios. However, many people continue to value the opportunity to speak to someone – particularly when making more significant or longer-term decisions.
“For employers, this presents a clear opportunity. By working with providers to offer a blend of digital support and human guidance, they can help employees take a more joined-up approach to their finances – supporting better outcomes for individuals. In turn, this can help to strengthen their employer value proposition – helping to attract and retain talent, while building a more engaged, financially resilient and productive workforce.”
