Employers are required by regulation to supply a office pension for his or her employees in the event that they earn above a specific amount.

Although underestimated, the office pension can add 1000's to at least one’s retirement fund.

When taking up a brand new job, wage is normally one of many greatest deciding components, whereas the advantages and pension bundle can usually be an afterthought.

However, new evaluation from Standard Life, a part of Phoenix Group, demonstrates how the pension contribution ranges an organization gives can have a huge effect on retirement outcomes, and will due to this fact be a key consideration when job searching.

Someone that started working full-time at an organization with a wage of £25,000 per yr and paid the usual month-to-month auto-enrolment contributions (5 p.c worker, three p.c employer) from the age of twenty-two, would amass a complete retirement fund of £459,000 on the age of 66*, not taking inflation into consideration.

However, in the event that they have been to hitch an organization on the identical wage however with a extra beneficiant firm pension scheme that paid an extra two p.c (5 p.c worker, 5 p.c employer) from the age of twenty-two, they might accumulate £574,000 by the age of 66 – an especially important £115,000 greater than the usual contributions would obtain.

To emphasise this additional if an organization was to contribute much more, for instance, an extra 5 p.c (5 p.c worker, eight p.c employer) from the age of twenty-two, a pension pot of £747,000 can be achieved – £288,000 greater than commonplace.

Dean Butler, Managing Director for Customer at Standard Life stated: “Workplace pension packages can massively differ, and it’s therefore important to understand what your employer is offering when deciding whether to start a new job.

‌“Our analysis shows that even a small increase in monthly pension contributions from your employer can have an extremely significant impact over the course of a career.

“For example, if you had two different jobs offers that pay the same salary, but one offer includes a pension package that pays just two percent more in pension contributions (five percent employee and three percent employer vs five percent employee and five percent employer), this would produce £115,000 of additional savings by the time they retire.

“That’s the equivalent of around 42 months of average salary for a UK full-time worker. The more generous your employer’s pension package, the bigger impact it could have over time.

‌“Of course, there are many factors to take into account when accepting a job offer, including salary, but the full benefits package should be considered as part of the decision-making process.

“It’s worth taking time to understand the short- and long-term impact on both your monthly income and pension savings, so you can weigh up what’s best for your individual circumstances.”

‌The auto-enrolment scheme states that if an individual begins to work for an employer and so they earn above a specific amount, they'll routinely be signed as much as a pension scheme organised by the employer.

At current, an individual needs to be at the least 22 and underneath state pension age to be eligible for auto-enrolment, though that is being prolonged to employees aged 18 and over this yr.

The individual has to earn at the least £10,000 a yr, for the present 2023/2024 tax yr to be auto-enrolled.