Setting aside bonuses into a pension could give savers “the best of both worlds”, Royal London has said.

Commenting on the latest Office for National Statistics data from its Annual Survey of Hours and Earnings, the pensions and investment firm noted that putting away some of their bonuses could allow earners to save for the future as well as enjoying the present.

The ONS revealed that pay, especially for the lowest paid workers in the UK has seen the largest increase since the 1990s, with a 6.2 per cent growth for the bottom 5 per cent of earners.

Furthermore, figures show that average bonuses and pay rises in the private sector in the UK in the last year is approximately £1,900. “Redirecting just some of that pay rise or bonus if possible, into a pension could result in a very welcome ‘bonus’ at retirement,” Royal London pensions specialist Fiona Tait said.

Royal London added that simply contributing £100 a month of earnings into a pension for 25 years could result in a pension pot being over £35,000 bigger at retirement.

“These savings moments of truth can really make a difference. There are always other uses for a pay rise or bonus, and often the money is spent before it’s actually been received. But by setting aside just some of a bonus or pay rise into a pension, people could have the funds and income to have a ‘treat’ in the future, as well as today - giving them the ‘best of both worlds,’” Tait commented.

“Royal London’s latest Pensions through the Ages research Feeling the Squeeze, revealed that over half (51 per cent) of 35-44 year olds would save more if they had a pay rise. This is one of a number of savings moments of truth or savings MOTs which could allow people to boost their pensions.

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