Anyone who waits until the launch of Personal Accounts in 2012 to start saving for retirement could miss out on a bigger pension pot by the time they retire.

According to Fidelity International, if a 25-year-old with even a cautious approach to retirement saving started now instead of 2012, their sum could be as much as £175,000 bigger.

Personal Accounts, the government's answer to the pensions crisis, launch in 2012 and will offer millions of Britons a workplace retirement savings scheme for the first time. Workers who already have access to a company pension will be automatically enrolled into it, rather than being given a Personal Account.

However, anyone who has the opportunity to start saving now but who decides to defer until they are compelled to do so will miss out.

For a 25-year-old-this, could be as much as £175,000. Even someone who only commits £100 a month rather than the maximum £3,600 a year allowed by Personal Accounts could gain an extra £58,000 by starting early.

Julian Webb, head of UK defined contribution pensions at Fidelity International, says, ‘The introduction of Personal Accounts in 2012 will see a big shake-up for both companies and employees, but a real concern is the prospect of people sitting back until they are forced to save, especially when many will be feeling bruised and battered by the credit crunch.

‘Starting early simply gives people the opportunity to build a bigger pot by the time of their retirement, and it also puts people in a better position to recover from falls in stock markets and interest rates. I'd suggest that anyone with access to a company pension scheme but who decided not to join should reconsider that decision now.’

He adds, ‘Sometimes it helps to remember that company pensions usually include free money. With the average employer contributing 6.3 per cent of gross salary to a DC scheme, anyone on the average wage of £26,020 could get, free, an extra £136 a month. If they choose to add in their own money as well then the government will bump this up with tax relief.’

Further reading:

Pensioners still face high inflation
Are politicians better off in retirement?
Do we need Personal Accounts?