The insurer’s nationwide study of around 1,200 people found that 43% of those working for themselves admit they do not have a pension, compared to just 4% of those in employment, while over a third (36%) of the self-employed say they cannot afford to save for retirement.

Around one in three (31%) say they will be relying entirely on the state pension to fund their retirement, while 28% will be reliant on their business to provide the income they need.

The Prudential’s analysis shows self-employed workers are savers – but the research found they are more focused on day-to-day emergencies than the long-term of retirement. Two thirds (64%) of the self-employed save to build up a safety net in case of an emergency in comparison with 57% of those in employment.

Just one in 10 self-employed people see a financial adviser regularly, despite having potentially more complex requirements than someone in employment. One in five (19%) are not confident with money and financial matters, while a quarter (24%) worry that they do not know enough about money.

The Prudential says the research shows the existence of an education gap when it comes to the importance of pensions for the self-employed as 20% admit they do not take pension saving seriously as they do not think it applies to them.

Kirsty Anderson, retirement income expert at Prudential, said: ‘Saving for a pension is still important as no one wants to work forever and no matter what your employment status, having money to fund your retirement is essential as the state pension is unlikely to be enough to fund a comfortable retirement.

‘If you are unsure how much you can afford to save into a pension, speak to a financial adviser as they will be able to help you with all aspects of your financial planning.’

The association of independent professionals and the self-employed (IPSE) said the Prudential’s findings of a self-employed pensions crisis mirrored its own recent research.

Simon McVicker, IPSE’s director of policy, said: ‘Auto enrolment is not the answer, however. While the policy has been a success in boosting the number of employees paying into a pension, IPSE’s research found that it simply isn’t a viable solution for the self-employed.

‘There is no employer to enrol them and it also reduces their ability to be flexible and in control of their money – two of the central attractions of self-employment.

‘Instead, we support rolling out a sidecar pension scheme, allowing the self-employed to save for later life and also into a separate “rainy day” fund for emergencies.’

IPSE’s report, ‘How to solve the self-employed pensions crisis’ is here

Report by Pat Sweet