Savers making end-of-year pension contributions may have missed out on compounding benefits, as analysis from Penfold has shown that March payments were up to four times higher than monthly averages.

The data revealed that around 22 per cent of annual pension contributions were made in March, with the average payment that month around three times higher than in most other months.

People who saved in this manner missed out on the benefits of compound interest gained from saving consistently throughout the year, the pension provider said.

According to the data, someone who invested £10,000 at the start of each tax year over 25 years would have ended up with about £24,000 more than someone who waited until the end of each year to invest the same amount, based on five per cent annual growth.

Penfold CEO, Chris Eastwood, explained that it is a common pattern to see people top up their pension close to the tax deadline.

“It’s great to see people taking action,” he said.

“But starting early gives your money more time to grow, and that can make a real difference over time.”

"April is a good time to re-set," Eastwood continued, adding that contributing earlier and more consistently can help savers make the most of compounding.

“Small, regular contributions throughout the year can be a simple way to build a bigger pension over time,” he stated.

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