The advice comes amid growing concerns about the gap between when people hope to retire and when they believe they can afford to stop working. Research from the Standard Life Centre for the Future of Retirement suggests that financial pressures are forcing many people to reconsider their retirement plans.
How an Extra £100 Could Change Retirement Savings
According to the Daily Express, financial experts at the Standard Life Centre for the Future of Retirement are encouraging workers to consider increasing their pension contributions, even when household finances remain under pressure. The organisation provided calculations illustrating how additional contributions could affect retirement savings over a working lifetime.
A worker earning £30,000 annually, contributing the standard automatic enrolment minimum of 5%, alongside a 3% employer contribution, could accumulate a pension pot worth £252,000 by the age of 68. The calculation assumes contributions begin at age 22 and increase by 2% each year. With an additional £100 a month in contributions, the projected pension pot rises to £346,000, representing a difference of £94,000.
Catherine Foot, director of the Standard Life Centre for the Future of Retirement, acknowledged that increasing savings was not necessarily straightforward for households managing everyday expenses.
“Finding extra money to save can be difficult, particularly when household budgets are under pressure, but even relatively modest increases in pension contributions can build into something significant over a working life,” she said.
Foot also encouraged workers to prioritise pension contributions where possible, noting that money invested earlier has longer to benefit from potential investment growth. The centre recommends reviewing existing pension savings, considering whether to consolidate separate pension pots and using salary increases or bonuses to raise contributions when circumstances allow.
Retirement Expectations Diverge As State Pension Age Rises
The pressure on retirement finances is also reflected in the difference between people’s preferred retirement age and when they expect to leave employment. According to the centre’s Retirement Voice 2026 report, respondents wanted to retire at an average age of 62.3 but expected to continue working until 67.6.
That represents a gap of more than five years between retirement aspirations and financial expectations. Ms Foot described the findings as evidence of the difficulties facing households as living costs continue to affect their financial decisions.
“The growing gap between when people want to retire and when they think they actually will is a clear sign of the pressure many households are feeling,” she said.
Changes to the state pension age form another part of the retirement planning picture. The state pension age is increasing gradually from 66 to 67 between April 2026 and April 2028. Existing legislation also provides for a further increase from 67 to 68 between April 2044 and April 2046.
The Government is conducting another review of the state pension age, scheduled for completion in 2029. Meanwhile, pension withdrawals can affect eligibility for certain benefits. According to Department for Work and Pensions guidance updated on 1 April 2026, money withdrawn from defined contribution pensions may be treated as income or capital when assessing means-tested benefits.
The guidance also explains that pension savings left untouched are generally disregarded for qualifying households below Pension Credit age. For workers reviewing their retirement arrangements, these rules sit alongside contribution levels, existing savings and the changing timetable for accessing the state pension.
