Jasmine Birtles
Your money-making expert. Financial journalist, TV and radio personality.
How To Increase The Value of Your Pension by £32,970 This Christmas
Ruby Layram
3rd Dec 2024
A recent survey by BlackRock UK revealed that nearly three-quarters of respondents do not feel confident that they will be able to save enough into their pension pot to afford a reasonable standard of living. For many, this is a scary thought that paints a pretty bleak picture for the future!
Luckily, a recent analysis by PensionBee revealed a simple way that Brits can save an extra £32,970 for retirement by giving themselves a Christmas gift.
A Christmas Gift That Could Help You to Retire Sooner!
The analysis by PensionBee revealed that you could add £32,970 to your pot by giving yourself the gift of an additional pension contribution each year.
If you were to add an extra £200 to your pension pot this year, you could increase the value of your savings by £305-£521 (depending on how close you are to retiring!).
If you were feeling particularly savvy this year and made an additional contribution of £400, you could increase the value of your pot by £608-£1,039. Over time, these contributions could really add up!
If a 25 year old started an annual festive tradition of gifting themselves an extra pension contribution of £400, they could save an extra £32,970 by the age of retirement (a year’s salary for a lot of Brits!).
Of course, the compound effects of this tradition may not be so dramatic for those who are closer to retirement. However, it is still a great way to use Christmas as a time to invest in your future self!
You could also check out these 5 pension alternatives to increase the value of your pot.
So, next time you’re tempted to indulge in a Christmas gift to yourself, think about topping up your pension pot instead! Your future self will definitely thank you for it.
3 Ways to Find £200 to Put in Your Pension Pot
For many, Christmas can be a bit tight on your wallet and the thought of saving away an extra £200 may not seem within reach.
Over on the Make Money section of MoneyMagpie, we have tons of helpful guides around how to make extra cash.
Here are 3 that you could try today.
Writing short stories
You don’t have to be a famous novelist to make money writing short stories. In fact, anyone can put a pen to paper and sell their story to a magazine, newspaper, or blog.
It is very plausible to make £200 for your short story entry – you just need to find the right place to sell it.
House sitting
This side hustle pays you for sitting in someone’s house and watching TV! House sitting involves staying in a homeowner’s home whilst they are away to ensure that the house is secure.
Appart from the occasional errand, such as watering the plants and feeding the cat, there usually isn’t that much work involved with housesitting.
If you have a remote job, you could even earn extra money while you work!
Flipping
Flipping involves buying something for a cheap price, updating it, and then selling it for a profit.
This is particularly popular amongst DIY enthusiasts, who can make a decent side income by using their skills to upgrade furniture (or other every day objects) and selling them on.
Anyone can make money flipping. You just need to know where to find items for a bargain price! I recommend starting with platforms such as eBay and Facebook marketplace.
Other Ways to Increase the Value of Your Pension Pot
Investing an extra £200 at Christmas is not the only way that you can save more into your pension.
Make the most of your employer match
If your employer offers a pension matching service, make sure that you are taking advantage of it. A lot of people miss out on huge savings because they aren’t aware of how much they could be getting from employer contributions.
If you aren’t sure whether your employer offers a match, I recommend getting in touch with the HR team to find out.
Opt for funds with a higher return potential
A lot of pensions allow you to have a say around which funds your money is invested into. If you are prepared to take a bit more risk, you could adjust your strategy and opt for funds that have a higher return potential.
This increases the chances of your money gaining value over time. However, it is impossible to predict what the stock market will do!
Consider alternative investments
A traditional pension is not the only way that you could save towards retirement. If your pension plan isn’t generating the returns that you hoped for, you could consider investing in a Stocks and Shares ISA, a Gold ETF or even government bonds.
Out of the three options, a stocks and shares ISA comes with the most risk. However, these investments can generate substantial returns over time, helping you save for your retirement.
If you’re looking for a way to gift your future self this Christmas, consider topping up our pension pot. It’s a tradition that will pay off for years to come!
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Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence. When investing your capital is at risk.
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