Cancelling unused direct debits and redirecting these funds into a pension could add up to £37,000 extra in retirement, new analysis by Standard Life has indicated.

This comes as the group estimated the average UK adult wastes £39 a month on direct debits they no longer need.

According to the research by Standard Life, someone who began working at age 22 with a salary of £25,000 and paid the minimum monthly auto-enrolment contributions – 5% employee, 3% employer – from the age of 22, could build a total retirement fund of £210,000 by the age of 68.

However, redirecting £39 of unused monthly direct debits into their pension, roughly the equivalent of leading streaming services at £18.99 and £14.99 today, could increase the projected fund to £247,000 – a figure £37,000 more in today’s prices.

Standard Life also estimated that the benefit could be even greater for those with more direct debits on the go. Someone who spends double the amount on wasted direct debits at £78 – roughly the equivalent of an average UK gym subscription (£47.24), premium video streaming (£18.99) and premium music streaming (£12.99) – could see a boost of £73,000 in today’s prices.

Retirement savings director at Standard Life, Mike Ambery, said that unused direct debits “have a habit of quietly draining our bank accounts in the background”.

“The new year is often a time people focus on their physical health, but it’s also the perfect moment to think about your financial wellbeing too,” Ambery commented.

“Redirecting just a few of those forgotten payments into your pension could make a meaningful positive impact to your financial future. However, it is important to double check terms and conditions of cancelling any direct debits or subscriptions to avoid potential penalties or impact on your credit scores.”

“If your retirement is decades away, pensions might not feel urgent but small changes made early on can have an outsized impact thanks to tax relief and the potential power of compound investment growth. A financial reset in January can make a meaningful difference to the income you’ll have in later life.”

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