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Your Questions: I've had a big pay cut, so should I ditch my pension contributions?

 

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Question: My employer has implemented a 20pc pay cut for the next six months, after which the company said it will review it. I'm 36 and am only back in the workforce 14 months, having taken five years out to look after my two babies. Money is tight and we are looking at cutting down on pension contributions, but I am not sure it's a good idea. I was already anxious about not having started a pension until I was 35 - now I feel like I am taking two steps back if I stop now.

Answer: Women in particular are known to have lower pension participation rates and, as a result, are under-provided for financially in retirement.

The fact you started pension savings last year is great, says Glenn Gaughran, head of business development and marketing at the Independent Trustee Company. You are still young and it is definitely a case of better late than never when it comes to a pension, he said.