New Penfold data shows that savers are delaying pension contributions – a habit that could significantly impact long-term returns.
Millions of UK savers could be missing out on tens of thousands of pounds in long-term pension returns by delaying contributions until the end of the tax year, new data from digital pension provider Penfold suggests.
Analysis of contribution behaviour on Penfold’s workplace pension has revealed a clear pattern of last-minute saving, with one-off pension contributions in March reaching up to 4.4 times the average monthly level seen throughout the rest of the year.
This means a disproportionate share of pension saving is concentrated at the end of the tax year, with around one in five (c.22%) of annual contributions made in March alone.
The data also shows that the average contribution value in March is around three times higher than in most other months, indicating that many savers make large, reactive top-ups just before the tax year deadline rather than contributing consistently throughout the year.
While this behaviour has become a consistent annual trend, it may come at a high long-term cost.
For example, someone investing £10,000 at the start of each tax year over 25 years could end up with around £24,000 more than someone who waits until the end of each year to contribute the same amount, assuming 5% annual growth.
Chris Eastwood, CEO at Penfold, said: “We see this pattern every year. Many people top up their pension close to the tax deadline.
“It’s great to see people taking action. But starting earlier gives your money more time to grow, and that can make a real difference over time.”
In contrast to one-off contributions, Penfold also found that regular monthly contributions remain broadly consistent throughout the year, highlighting a clear divide between long-term saving habits and last-minute decision-making.
“The new tax year is a good moment to reset”, Eastwood added. Contributing earlier and more consistently can help savers make the most of compounding and build stronger financial futures.
“Small, regular contributions throughout the year can be a simple way to build a bigger pension over time.”
