Stay up to date with notifications from The Independent

Notifications can be managed in browser preferences.

Pausing pension contributions for a year ‘may dent retirement pot by thousands’

A break in payments can result in a significant reduction in the eventual sum available, says a leading pensions provider

Vicky Shaw
Tuesday 12 July 2022 18:52 BST
Comments
Someone stopping contributions for two years could end up around £25,000 worse off in retirement
Someone stopping contributions for two years could end up around £25,000 worse off in retirement (PA)

People who pause their workplace pension contributions for just a year due to cost-of-living pressures may end up thousands of pounds worse off in retirement than if they had continued paying in, calculations suggest.

Someone who started working with a salary of £25,000 per year and paid the minimum contributions from the age of 22 could end up with nearly £457,000 in retirement, pensions provider Standard Life calculated.

But if they paused at the age of 35 for just one year, they could end up with just over £444,000 by the age of 68 – nearly £13,000 less than if they had continued to pay in.

Join our commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in