State pensioners across the UK face a major cut to their pension savings if they make one mistake.

       When putting away funds for your pension it’s best to start as early as you can so you have longer to build up a decent cash pot to allow you to retire when you want.

       This nest egg will also have longer to accrue interest over time, making it an easy way to add some extra money to the pot.

       Paying voluntary contributions is also well worth doing to plug any missing years in your National Insurance record, or you could opt to delay your pension to give yourself time to add to your savings. But there is one other easy way to add to your pension that you might not realise.

       Read More: State pensioners urged to make phone call for ￡300 by end of January

       According to research by the Institute and Faculty of Actuaries (IFoA), people who don’t take advantage of extra employer contributions risk losing thousands of pounds from their pension savings - a mistake that can cost you up to ￡100,000.

       The Pensions Act 2008 states that every employer in the UK must put certain staff into a workplace pension scheme and contribute towards it in a process called 'automatic enrolment'.

       Employers that have at least one member of staff have certain legal duties and must pay at least 3% of their employee’s ‘qualifying earnings’ into their staff’s pension scheme. Under most schemes this is normally earnings between ￡6,240 and ￡50,270 a year before tax. Total earnings include:

       Don't miss...

       State pensioners given 11 freebies and discounts worth ￡8,527 in January

       State pensioners handed ￡470 boost in 2025 from DWP

       UK households ￡174 better off with little-known TV licence rule

       Employers must then deduct contributions from their staff’s pay each month to put into their pension pot.

       Most employers will allow staff to increase their contributions above the minimum 3% and may offer the option to ‘match’ the extra money staff put in up to a certain limit, meaning you can easily benefit from a bigger boost to your savings.

       Employees are advised to speak to their HR department or pension provider to see what extra contributions are available.