Prudential reveals more than a third put their pension savings on hold

Prudential has revealed new research which shows more than a third (35 per cent) of British adults who are yet to retire have stopped paying into their pension pots.

The results of the nationwide study show that one in three (33 per cent) of those who have put pension payments on hold have done so because they are out of work, while over a quarter (27 per cent) say that they can no longer afford the contributions.

More than two-fifths (43 per cent) of those who have stopped paying into their pensions do not plan to start again, despite the long-term impact it will have on their retirement income.

Prudential’s calculations show that irregular contributions could reduce the values of savers’ pensions by thousands of pounds. In fact, a saver who misses a year of gross contributions of £2,400 could see their final pension fund reduced by £7,000*.

Vince Smith-Hughes, head of business development at Prudential, said: "Tightening your belt when times are hard is sometimes necessary, and putting pension contributions on hold might seem an easy way to save money; however, neglecting pensions today means throwing money away tomorrow, as savers will miss out on perks, such as tax relief and employer contributions.

“Abandoning your pension pot really should be a last resort when times are tough. By getting into the routine of saving into a pension as early as possible, savers will be able to ensure the comfortable retirement that they deserve.”

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Notes to Editors
Prudential’s insights based on a survey of 1,602 non-retired adults in the UK, conducted by Research
Plus in August 2011.
*Statistics are based on Prudential’s Flexible Retirement Plan, and assume a 7 per cent growth.

About Prudential:
’Prudential’ is a trading name of The Prudential Assurance Company Limited, which is registered in England and Wales. This name is also used by other companies within the Prudential Group, which between them provide a range of financial products including private pension products, life assurance, advice on money saving and pension advice.

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