SIPP savers are facing a ‘retirement mirage’ as their confidence about achieving a comfortable retirement outpaces their understanding of how they will achieve it.

Nearly two-thirds are expecting a comfortable retirement despite few having set financial goals or used tools to model their income needs.

New analysis from pensions consultant Barnett Waddingham shows that 63% of SIPP-only savers are confident about a comfortable retirement compared to 55% of DC-only savers.

For those who hold a mix of pension types, SIPP, DC and defined benefit pensions, the confidence increases to 81%.

The data also shows that less than a fifth, only 18%, of SIPP-only savers have set clear retirement goals or budgets. The propensity to set goals or a budget rises to 21% for those with both a SIPP and a DC pension, and to 30% for those with a mix of DC, SIPP and DB pensions.

But it means the majority are still approaching retirement without fully mapping out how much they’ll need.

Nearly two in five, 39%, of SIPP-only savers have spoken to their pension provider about their retirement planning. Additionally, while around a third, 32%, have consulted a financial adviser, twice the level seen among DC-only savers, 16%, the findings suggest many are going without professional financial support.

Use of online retirement planning tools remains relatively low across all groups, with just 27% of SIPP-only savers using digital tools to model their retirement income needs.

With many SIPP savers also managing multiple pension arrangements, this could raise concerns around complexity of maintaining visibility across all of their pension savings, said Barnett Waddingham.

James Jones-Tinsley, self-invested pensions technical specialist at the firm, said: "One of the biggest challenges we face is that currently, there’s no single national picture of retirement readiness. The fragmented nature of UK retirement savings means many individuals hold multiple pension types alongside their SIPPs - including DB and DC schemes - each with different rules, benefits and risks.”

He said the introduction of the pensions dashboard, alongside the potential for commercial dashboards, will help people visualise their full retirement position for the first time. But visibility isn’t the same as understanding. He said better tools will allow people to model their options, but many will still find the choices complex and uncomfortable.

Mr Jones-Tinsley said: “Between dashboards and modelling, it may become clear to more people that they are off track - and that’s where advice will be crucial. In fact, more people may find that professional advice is not a ‘nice to have’ but a necessary part of their retirement planning.

“The challenge now is for the industry to ensure that once visibility improves, the right guidance, education and support structures are there to help people take informed action."

• Barnett Waddingham commissioned Censuswide to survey 5,032 UK employees and self-employed people aged 18+, at least 3,000 of which are over 50 and all of whom plan to retire in their lifetime. An additional 548 respondents who didn’t plan to retire were asked why not. Analysis was based upon a sample of 978 respondents who said they have a private/SIPP pension. The survey was conducted in summer 2024.