Investment growth makes up nearly two-thirds of pension pots, Standard Life finds

Nearly two-thirds of a typical pension pot comes from investment growth, but most people do not realise it, according to analysis from Standard Life.

Research highlighted that £65,000 of a £100,000 pension pot is from compound investment growth, compared to £18,000 in individual contributions, £13,000 in employer contributions and £4,000 from tax relief.

Only one in four (25%) of people said investment growth is the main driver of their pension value, while two fifths believed individual contributions made the biggest difference. 

A quarter pointed to employer contributions and almost one in ten identified tax relief.

Just 15% said they actively prioritised saving into their pension, while one in five admitted they see retirement planning as something to worry about later. 

This rose to more than a third among Gen Z, despite younger savers having more time for their pension to grow.

Additionally, Standard Life found that someone starting pension saving at age 22 could build a fund of £210,000 by age 68, compared to £170,000 if they start at 27. 

Waiting until 32 reduced this to £136,000, and starting at 42 means a pot of £82,300.