One in 20 with pension savings stopped paying into their pots

ONE in 20 people with pension savings say they have stopped paying into their pots altogether during the coronavirus lockdown, a survey has found.

But the same proportion of people (5%) say they have increased the amounts going into their pensions during the Covid-19 crisis - perhaps eyeing up the potential for a strong bounce in the value of their pots when the economy eventually improves.

Aviva found that more than a third (37%) of pension savers - equating to seven million people across the UK have taken some sort of action relating to their pension during the lockdown so far.

Nearly three in 10 (29%) are now reviewing their spending habits more often, while just under one in six (16%) said the lockdown has prompted them to think about their pension more.

While 5% of pension savers said they had stopped making payments in altogether, another 6% said they had decreased the amounts they were putting in their pension but were still saving. Others in Aviva’s survey had taken action by checking the value of their pension or where it was invested, while 5% had withdrawn money from their retirement pot.

The Work and Pensions Committee has previously heard evidence that contributions paid during the pandemic could end up being particularly valuable for savers. The committee published a report last month which said: “Contributions made when market values are low will see a greater increase in their value than usual if markets return to normal levels.”

Alistair McQueen, from Aviva, said: “Volatility in the stock market is normal and markets often rebound quickly.”