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

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.