Only 420 pay packets to go - and all i'll get is a £3,000-a-year pension

A thirty-year- old man planning to retire at 65 will only pick up his pay packet another 420 times before downing tools for good, analysis from Virgin Money shows.

And even if he contributes £100 every month towards his pension until then, he can expect just over the equivalent of £3,000 a year in annual income in today's money once he retires - even assuming his savings grow by a decent seven per cent each year.

That's the shocking outcome of Virgin Money's Pensioner Profile Analysis, which tracks how a regular £100 pension contribution will mature once you retire. The figures show that people with low pension contributions will struggle in later life as the money they set aside will have less value in the future compared to now.

The company says that even a 20-year-old woman who saves £100 a month from now until she retires at 65 will only have set aside enough for an annual pension worth £12,700 in the year 2053. And according to Virgin Money, this sum would only be worth a paltry £4,190 in today's money due to inflation.

However the same woman could benefit from an income of as much as £29,300 a year in real terms if she decided to increase her regular payments by 10 per cent a year. Virgin Money's calculations show that saving just a small amount more could dramatically affect your income in retirement.

Scott Mowbray of Virgin Money said: "Thinking about your pension in terms of how many pay packets you've got left before quitting work concentrates the mind.

"Saving for retirement is not a sexy subject and thinking ahead thirty years is very often low on a list of priorities. This explains why so many of us do not pay it much attention. However our analysis proves that paying attention is critical.

"A ten per cent increase in your yearly contributions will dramatically affect the quality of life you can expect when you retire. It may seem a long way off but acting now is the only way to make the difference in the future.

"It's a strange conundrum and many people won't want to sacrifice ten per cent extra when they could be spending that now, but it really is worth it."

The Virgin Money research shows that a 20 year old man increasing his regular payments by 10% a year for the next 45 years could increase their eventual retirement income by 600%. In real terms, that's the difference between an income of £4,630 a year or £32,500 a year.