Why you’re never too young to start saving for the future

MoneyPlus Features Team

When you’re young and entering the world of work, the feeling of seeing your first month’s pay in your bank account is one you won’t forget.

Saving for the future? That’s for another day, surely.

As you leave behind school or university, it’s exciting to finally be financially rewarded for your hard work. When the reality of rent, student loans, and other bills start to eat away at your money, it’s easy to understand why saving for your pension might not be top of your to-do list.

Why give up money you could be enjoying right now for something that seems so far away?

Actually, starting when you’re young makes great sense.

As Jamie Jenkins, our Head of Pensions Strategy, explains: “For most young people, saving for retirement will be a long way down their priority list.

“However, getting into the savings habit early and making a start on that nest egg can make a big difference further down the line.”

Think of it as paying your future self…

Instead of viewing saving into your pension as giving anything up, think of it as paying your future self.

You’re not missing out; you’re investing in your future, bit by bit.

Giving yourself peace of mind that you’ll be able to spend your retirement doing the things you want to.

After all, a study carried out by YouGov found 35% of under-35s believe that the state pension won’t be around at some point in the future.

So what can you do to take back confidence and make sure you’re building a secure future with your own savings?

Start saving for the future early

Your workplace pension is a great place to start. More than 9.5 million people in the UK have now automatically enrolled into their employer’s scheme, which is good news.

You pay in and your employer also contributes, which adds up to free money going into your savings pot.

Jamie Jenkins continues: “Unlike other savings products, employers are legally obliged to make contributions to pensions for their employees and that can make a big difference to what you save over your working career.

“For some young people today, they will have the opportunity to become retirement millionaires, provided they start saving early and take advantage of what’s on offer.”

It’s worth finding out how much you need to pay into your workplace pension to get the maximum contribution from your employer.

Read our blog on how to get the most out of your workplace pension.

Add to that the tax relief you get – which is what makes pensions such a tax efficient way of saving.

Tax breaks mean that saving £100 into your pension normally only costs you £80 – or effectively as little as £60 if you’re a higher rate taxpayer or £55 if an additional rate tax payer. The figures are slightly different for Scottish residents because income tax rates in Scotland differ from the rates in the rest of the UK. Our guide shows you pensions are a really tax efficient way to save. Remember, tax rules and legislation can change. Your own circumstances will have an impact on tax.

It’s a good idea to review your payments each year, and try and increase them if you get a pay rise.

You’re never too young to start thinking about saving for the future. Getting yourself into the habit early will go a long way in helping you plan for a future that you can look forward to.


Remember that a pension is an investment. Your savings are invested, which means that they have the opportunity to grow over time. As with all investments, the value can go down as well as up, and you may get back less than you paid in. Information correct in September 2018.