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A major UK pension provider has urged younger Britons to make a 50p change that could be worth almost £60,000 by the time they reach retirement age. As millions of Britons begin receiving payslips with April's National Living Wage (NLW) rise, online pension provider PensionBee is calling on savers to consider putting the extra cash into their pension to boost their nest egg later in life.

From April 1, the NLW for those aged 21 and over rose to £12.71 per hour, marking a 4.1% increase of 50p per hour on the previous year. According to PensionBee, that amounts to approximately £81 per month in additional gross pay for a full-time worker (37.5 hours per week). According to their analysis, if a 25-year-old worker chose to put this additional £81 per month into their pension, it could grow into surprisingly large savings over time. After 10 years, their pot could grow by an extra £10,502, and by £23,000 over 20 years (both inflation-adjusted).

The retirement age is currently being gradually raised from 66 to 67 for millions of Britons. It may increase further, but PensionBee uses 67 as a baseline for calculating long-term potential savings growth.

According to the financial services firm, by retirement at age 67, the small monthly top-up could be worth around £59,505 in today's money, as a result of compounding investment growth.

For those aged 18-20, the effects of the savings trick are even more pronounced. This age group saw their NLW increase by 8.5% to £10.85 per hour.

It means an 18-year-old who diverted their 85p pay increase into a pension could see their pot grow by an extra £126,436 in today's money by retirement, the company says.

PensionBee's analysis is based on an annual investment growth rate of 5%, compounded monthly, with contributions made at the end of each month. It includes an annual provider fee of 0.7% and an annual salary growth of 2.5%, and assumes long-run inflation of 2.5%.

And while workers need to be 22 or over to be automatically enrolled in a workplace pension, those aged 18 to 21 can still opt in, provided they meet the earnings threshold, or open a personal pension and pay into it.

PensionBee says starting contributions earlier allows compound growth to do more of the heavy lifting and helps Britons avoid gaps in their retirement savings.

It recommends considering whether the extra cash could be put aside before it's absorbed into everyday spending.

Maike Currie, VP personal finance at PensionBee, said: "A 50p-per-hour pay rise might not feel like much, but when it comes to pensions, there is power in small amounts, especially if regular and early on in your savings journey.

"If workers redirect their pay increase into a pension now, before it gets sucked up into their daily spending, they can turn even a modest wage increase into meaningful additional pension savings at retirement.

"Starting with even small pension contributions at a younger age amplifies the benefit of compound growth, and April is the ideal time to act. With the cost of living still weighing on household budgets, it might feel counterintuitive to put money away.

"But locking in a pension increase now, means workers can protect their future spending power rather than watching it slowly disappear.

"A few minutes spent adjusting your pension contributions this week could be one of the most valuable financial decisions you ever make."

PensionBee has a Pension Calculator to help you work out how much the April pay rise could add to your retirement pot.