New research has found that one group of people could be set to increase their pension pot significantly.
If you are retirement planning in Cheshire or Oswestry and are a DINK (the acronym of “Dual Income, No Kids”), research has shown there is one way you could increase your retirement savings by many hundreds of thousands of pounds.
The study by Standard Life calculated that diverting the cost of raising a child into a pension could raise an additional £351,000. If an adult contributed an extra £13,000 towards their pension from the age of 30 onwards for 18 years, this would amount to around £603,000 by the time they reached state retirement age.
This figure is estimated to be around £351,000 more that someone who started saving at 22, on a salary of £30,000 and who contributed only the minimum defined auto-enrolment amount over their career. This equates to a 5% employee contribution and a 3% employer contribution.
The research found that even reducing that figure by 50% to £6,950 per annum could still make a big different to your pension pot. Somebody in that position might be line to add £175,000 over their working life, leaving them with approximately £428,000 at the end of it, subject to inflation.
Commenting on the findings, Standard Life’s managing director for workplace pensions, Emma Furlonger, said that whilst this level of pension planning may not be realistic or feasible for everyone, it does show how rewarding additional saving can be in the longer term for those on flexible household budgets.
