Published On: Tue, Dec 6th, 2022

Pension: How much do you need to save at 21, 30, 40, 50 and 60 for a £100,000 pot? | Personal Finance | Finance

Putting aside money for later down the line in a cost of living crisis may seem counterintuitive, but could end up having substantial benefits. Many people are unsure when to start saving, but analysis has shown the earlier a person begins, the better.

According to Investing Reviews, if a person starts contributing to their pension at the age of 21, they could quickly build up their pot over time.

Assuming a five percent rate and starting at 21, a person would only need to put in £53 per month to come out with a £100,000 pot at the age of 65.

The longer a person leaves the decision to start saving, the more ground they will need to make up.

Based on a five percent rate, if someone starts just nine years later at the age of 30, they would need to put in £88 per month to achieve the same result.

READ MORE: Pensioners ‘need £20,000 a year’ in income

The answer is compound interest, which is often seen as the most powerful tool at a saver’s disposal, and described as “life-changing magic” by Forbes Magazine. 

With compound interest, people can gain interest on previously earned interest from saving –  and so their amount can quickly snowball. 

Simon Jones, CEO of, analysed this and what pension savers can be doing.

He said: “Albert Einstein once called compound interest the eighth wonder of the world, and who are we to argue with the great man?

“The earlier you start to pay into a pension, the lower your contributions need to be to hit a specific target. The difference can be dramatic.

“A pension starting to save at 21 would only need to put aside £53 a month to hit a £100,000 pot, assuming a five percent interest rate.

“But beginning at age 50 would require almost seven times as much. 

“Investing early and often works the same when it comes to ISAs. 

“Don’t wait until the end of the year to put your money in – you’ll be compounding your interest if you leap in on day one.”

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