Brits could be as much as £1,442 better off by the time they reach retirement if they diverted half of the money they are forecast to spend this Christmas to their pensions, according to analysis from PensionBee.

The analysis was based on a recent study from Statistica, which revealed that average spending per head during the 2021 Christmas period is expected to reach £1,131 across the UK, with a low of £994 in the North East and a high of £1,746 in London.

In light of this, PensionBee suggested that if Brits were to save a quarter of the average amount predicted to be spent, around £283, they could add between £423 and £721 to their savings, depending on how far from retirement they are.

A saver who manages to cut back further could make even greater gains, as cutting Christmas spending by around half, around £566, could boost a savers pension pot by between £846 and £1,442 ahead of retirement.

Continuing this behaviour year-on-year could also prove beneficial for savers, as the analysis found that, if a 25 year old continued putting the higher Christmas bonus of £566 into their pension until age 65, they could benefit from an additional £37,483 in pension savings.

Those in their mid-30s, meanwhile, could add between £13,260 and £25,968 to their pots respectively, while those in their mid-40s could save an additional £8,203 to £16,065.

Whilst those in their mid-50s would have less time until retirement, the analysis found that an annual Christmas pension contribution of £283 could nonetheless raise an extra £3,821 towards their retirement fund, increasing to to £7,482 for those who save the higher amount of £566.

Commenting on the findings, PensionBee CEO, Romi Savova, said: "With Christmas fast approaching I would urge savers to think about how much they are spending on festivities, and whether any of that money could be redirected towards their pension instead.

"The power of compound interest can have a significant impact on the total pension pot they retire with.

"Paying a Christmas bonus into your pension via a lump-sum payment is simple to do, and your future self will thank you greatly”.

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