Ten million workers in the UK will now see more of their wages automatically diverted to a pension, starting from 6 April 2019 when the workplace pension scheme will rise again - to a total of 8%.

The Government is giving a tax relief to those contributing to their pension. For basic rate payers, a £100 contribution to the pension will cost £80 - due to the 20% tax relief - and higher tax brackets will receive a larger percentage of relief.

However, it will mean less take-home pay for people who are automatically enrolled into a workplace pension - a person earning £30,000 per annum will pay an extra £32 a month into their pension. This has caused experts to worry that these employees will see the short term income loss as a reason to opt out of the auto-enrolment.

Employees are being urged to remain enrolled in the scheme to reap the long term benefits, as an annual pension contribution of 8% of salary, from the age of 30, could mean £125,000 in their pension pot at retirement.

Analysts say that by choosing to opt-out of this automatic pension saving, workers would actually lose out on the money their employer puts into their pension pot.

Tom Selby - Senior Analyst at investment company AJ Bell - stated:

"Anyone who chooses to opt-out is basically taking a voluntary pay cut. If you turn down the matched contribution from an employer you won't get it back elsewhere."

Advice for workers who are worried about what happens when they move employers is that most modern pension schemes are portable - meaning it can be moved through employers, roles and industries. Moving employers does not mean the pot will be lost.

Michelle Gribbin - Chief Investment Officer at Profile Pensions - advises:

“The workplace pension scheme is to the benefit of UK employees and designed to help everyone prepare for their financial future. Together, the employer contribution, tax relief and investment growth offer the ability to significantly increase the value of your money for a time in your life when you will really need it.

Straightforward pension advice is a vital step in the personal finance education process. When people really understand what these contributions mean, where they come from and how opting-out impacts their financial future, they become empowered to make their own informed decisions and potentially be over £125,000 better off in retirement.”