Martin Lewis warns workers against the mistake of ‘throwing money’ at pensions
Money Saving Expert founder Martin Lewis has warned UK workers they could be ‘throwing money away’ with just one mistake. The consumer expert was fielding calls on ITV’s This Morning on Wednesday morning about the current cost of living crisis.
He was on the show to help Britons cope with rising energy bills, petrol prices, grocery store bills, council tax hikes, health insurance contribution hikes. National Insurance and more, reports Birmingham Live. One of the questions came from Emma, who asked Martin about joining a workplace pension plan at age 66 through auto-enrollment.
He told her: “The minimum contribution is 8% of your salary, in which case the company must contribute at least 3%. If you back out, you’re basically giving a raise – they give you another 3%.
“You lose a bit of take-home pay because you contribute 5%, but that’s extra money you get in your pay.” Martin added: “Generally you really don’t want to pull out of your work pension because you’re offering a pay rise.”
The cost of living in the UK has risen at its fastest rate in four decades, with soaring energy bills putting millions of households under pressure. Consumer price index inflation rose to 9% in April from an already high 7% in March, the Office for National Statistics (ONS) said.
It was the fastest measured rate since records began in 1989, and the ONS estimates it was the highest since 1982. Much of the rise was due to price caps on utility bills. energy, which rose 54% for the average household at the start of the month.