Some 11.9m people in the UK are not saving enough for retirement, according to research from the Department of Work and Pensions.
The research, published today, warns mid-range and high earners currently face the biggest drop in spending power when they leave work.
Of the 11.9m undersavers, the DWP analysis shows only 49 per cent (5.8m) are more than 80 per cent toward their target retirement saving.
It says one million are less than 50 per cent of the way to their retirement target, while 5.1m have achieved 50 to 80 per cent of their target.
The targets are calculated based on the ratio of pension income to earnings between age 50 and state pension age. It sets an income replacement target of 80 per cent for lower earner down to 50 per cent for those earning more.
The DWP says more needs to be done to encourage earning between age 50 and state retirement age to prevent more people falling below target retirement rates.
Pensions minister Steve Webb says: “This coalition Government’s sweeping reforms of the pensions system will make a huge difference to the long-term financial prospects of most working age people. But while the state will always provide a decent safety net so people can get by, anyone wanting to see their standard of living maintained into old age needs to make their own provision too.
“This new research shows by saving just a little more, a huge number of working people could make their future retirement so much more comfortable.”