The National Living Wage will increase from £10.42 to £11.44 an hour, and it will also be extended so the rate applies to all over 21s, rather than just over 23s, from April.

For full time employees this equates to a total annual pension contribution of £1,166 a year, made up of their own five per cent and their employer’s three per cent pension contributions.

Ms Smith stated that when allowing room for investment growth and future salary increases over a lifetime of fulltime work, Britons could see an increase in future pension pot of over £37,200.

She said: “Allowing for investment growth and future salary increases, over a lifetime of fulltime work this could lead to an increase in future pension pot of over £37,200 – giving a total projected pension fund of £397,700.

“These new figures bring into sharp focus the benefits of paying into a workplace pension.

“Opting out might seem appealing for those on lower wages but the gain in take-home pay today is tiny compared to the boost to future pensions from sticking with it for the long term.”

Ms Smith also called for timetabling on the expansion of workplace pension auto-enrolment.

The government has not yet put a timeline in place of when it will expand auto enrolment rules to extend to under 22s.

Currently under 22s are excluded from auto-enrolment, which means that they won’t benefit from an employer pension contribution.

She continued: “Rather than kicking this into the long grass, we urge the government to implement this change sooner rather than later along with equalising the National Living Wage for the under 21s, who will receive only £8.60 an hour from this April.

“Higher pension contributions, invested over a longer period, enable employees to build up larger pension pots so they can plan for a more secure retirement.”

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As a result of higher-than-normal wage increases and the increase in the NLW, more people will earn more than the £10,000 earnings trigger, which will bring them into the fold of auto-enrolment.

Ms Smith added: “This will particularly benefit women, who tend to be on lower earnings, as many work part-time, or have multiple jobs, each one below £10,000 a year.”

Campaigners have long argued that the £10,000 earnings trigger should be scrapped altogether. This would allow people with multiple part-time jobs, each of which pay less than £10,000 per year, to benefit from auto-enrolment.