‘To try and make up the difference, there are a few options. The first and most obvious is to try and maximise and increase contributions whenever possible. This doesn’t have to be done every month, even sporadic and infrequent increases in contributions – as early as possible – can make a huge difference in bridging the gap to comfort,’ Sweeney said.
He added: ‘Perhaps if you decide to stay in on a weekend and save some money, why not throw £20 into a pension (which will get an immediate boost of at least 20 per cent from tax relief, turning it to at least £24) and just do this whenever you get an opportunity.’
Sweeney suggests that any monthly payments you have that stop, or are reduced, such as mortgage payments, could then be redirected as pension contributions. This way, you won’t notice the difference to your budget, and will be making a noticeable difference to your pension pot.
Another option, he says, is to add the amount you will save in National Insurance contributions when they reduce on 6 April into your pension each month.
Again, you won’t notice the difference in your pay-packet from the months before the cuts came into effect, but this could equate to hundreds of pounds per year under the average salary.
Higher tax payers, meanwhile, can gain an extra 20 per cent in tax relief by filling out a self-assessment tax return each year.
Employers may also offer higher contributions if you up your own contribution. Whilst this does mean putting more of your own money into your pot, it is worth asking your employer, in order to make the most of the benefits on offer.
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