Daily Mirror



It’s tough to keep on top of our bills at the moment but ditching pension contributi­ons, even just for a few years, could leave a huge dent in your savings.

A short three-year pension contributi­on break could result in £36,000 less in your retirement pot, new analysis from Standard Life reveals.

Someone who began work at the age of 22 in 2020 with a salary of £25,000 per year, paying the standard monthly auto-enrolment contributi­ons (5% employee, 3% employer), could amass a total retirement fund of around £459,000 by the age of 66. That’s assuming 5% investment growth and a 0.75% investment charge.

However, opting out of pension contributi­ons for three years at the start of their career could result in a total pot of £423,000 – a hefty £36,000 less.

Opting out of autoenrolm­ent and their workplace pension for a longer period would have an even bigger impact.

Opting out for six years would mean £71,000 less and nine years would reduce their pot by a huge £105,000.

Gail Izat, managing director for workplace at Standard Life, said: “Households have had a great deal to contend with over the past three years, with many having to cut back on spending and saving as a result.

“While cutting back on longterm saving might seem like the least harmful of a bunch of bad options, particular­ly earlier in life, it could result in people missing out on tens of thousands of pounds in retirement.

“If you’ve opted out in recent years, when circumstan­ces allow remember your pension. Your future self may well thank you.”

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