One in six (17%) mass affluent savers have stopped contributing to their workplace pension in the last 12 months, according to a new study.
One in ten (10%) of the 3,000 savers surveyed had stopped contributing to their pension completely.
Another 7% have temporarily paused their contributions, according to research from wealth manager and Financial Planner Raymond James.
A further 10% of savers had lowered the amount they contribute to their pension.
When asked why they had stopped or reduced their contributions, 20% said it was due to the impact of rising day-to-day living costs, with a further 18% saying they had reduced their contributions in order to build an emergency savings pot.
Other reasons for stopping or pausing contributions included to go travelling (15%), wanting to focus more on savings rather than investing (15%), to pursue a side project or hustle (12%), and to pay off their mortgage (12%).
Over one in ten savers (11%) said they stopped, paused, or reduced their pension contributions to take a break from work, such as a sabbatical or for a break between jobs, while the same number (11%) did so to have children. A further 10% did so as a result of the Middle East conflict impact on their investments.
One in ten (9%) mass affluent savers did not have a workplace pension at all. This fell to 4% for those in full-time employment, demonstrating the impact of auto-enrolment.
However, other savers had improved their retirement savings. A quarter (29%) of those surveyed had managed to increase the amount they contribute to their pension over the last year, with 7% having paid in a lump sum to boost their pension.
Harry Bell, director of Financial Planning at Raymond James, said: “Pensions are one of the most important and effective tools for securing financial stability in later life. But with more than one in six either completely or temporarily stopping their workplace pension contributions in the last year alone, this raises major red flags. Even more so for those currently in full time employment.
“Pensions provide a structured way to build a long-term retirement fund, being tax-efficient and benefiting from the results of compounding and additional boosts from employers. But making survival-based financial decisions, which may seem sensible in the near-term with retirement feeling a long way off, can have long-lasting consequences.”
• Censuswide surveyed 3,000 mass-affluent individuals with a pre-tax salary of at least £39,000 plus at least £1,000 in accessible cash or savings on behalf of Raymond James in June.