The rising variety of savers lowering or pausing their pension contributions to steadiness excessive dwelling prices - even for as little as three years - might threat shedding tens of 1000's of kilos in retirement.

New analysis from M&G Wealth reveals that people lowering their month-to-month office pension contributions from £200 to £100 might price them as much as £271,619 of their whole pension pots.

According to the agency, this could signify a distinction of £20,919 in annual revenue, which interprets to a discount in month-to-month revenue from £3,479 to £1,735.75.

The figures, calculated by the Prudential Retirement Modeller, assume a 25-year-old and their employer halves contributions to a mixed £200 a month, which stays at this stage till the age of 67. Meanwhile, contributing £200 a month matched by an employer would garner a way more sizeable £543,238 pot.

Kirsty Anderson, pension specialist at M&G Wealth, stated: “The cost of living crisis is continuing to place a strain on people’s bank balances, and many are having to take action to free up more cash for the here and now.

“However, while reducing pension contributions might seem like a quick fix to free up money, savers need to be aware of the financial implications this could have for them later in life.”

Ms Anderson stated pensions are “one of the most efficient” and “lucrative” types of saving, particularly for these in corporations with an employer-matching scheme.

She stated: “There might be better ways of raising short-term funds. Our data shows that even taking a short break from your contributions could have a significant impact in retirement.”

For these seeking to improve short-term cash by quickly halting funds for a span of three years earlier than growing again to earlier ranges, M&G consultants stated it could nonetheless price them as much as £59,158 in retirement.

For adults incomes the common UK wage of £27,756 a 12 months contributing the minimal auto-enrolment quantity monthly (£143.44), quickly halting contributions for 3 years at age 30 might influence their last pot by £21,792.

This might go away them with a pot of £173,013 in comparison with a pot of £194,805 in the event that they have been to proceed contributions at present ranges.

In addition to pension contributions, the survey discovered that nearly two-fifths (37 %) of respondents have diminished their financial savings or investments, and an extra 27 % of individuals plan to take action by subsequent May.

The main drivers of concern have been the rising cost of living and rates of interest, with 84 % of respondents worrying about inflation, and 72 % involved about rising interest rates. Up to 30 % have additionally diminished spending on monetary recommendation and half of these surveyed have diminished spending on on a regular basis luxuries like espresso and consuming out.

Up to 44 % have additionally taken steps to scale back the quantity they spend on their weekly meals store, as buying basket costs stay excessive.

Ms Anderson stated: “In an environment where every penny counts, savers should equip themselves with as much information as possible before making changes – from the use of free online tools to the services of a financial adviser for those with bigger pots of money.”