As increasing numbers of furloughed or out of work individuals are forced to dip into their savings, the impact this is having on pensions savings is now being revealed.

According to research by Scottish Widows, fewer people are now putting money aside for pensions (22%) than they are for keeping it available to pay for a rainy day (36%).

The research also revealed it was only because people couldn’t access their pension pots that they potentially still exist at all. It found almost one in five (19%) admitted they would have already accessed their pension pot during Q4 2020 if they could have been granted early access.

The results will be a worrying sign that once-careful savers are foregoing future security for getting by in the short-term.

Jackie Leiper, workplace savings director, Scottish Widows, said: “Pressure on families’ financial resilience and lack of protection leaves people in danger of saving less for the long-term and more for emergencies due to uncertainty over the immediate future.”

She added: “Household savings are being severely squeezed for those hardest hit by the pandemic. Around one in five households say lower workplace income had made their financial situation worse at the end of 2020.”

The news could have come at a worse time – the day The Department For Work and Pensions revealed the long-awaited Pensions Bill had finally moved to the Queen to be given royal assent after being passed by the House of Lords.

Department for Work and Pensions parliamentary under-secretary of state baroness Deborah Stedman-Scott said: “The bill will make pensions better by creating a new style of pension scheme that has the potential to increase future returns for millions of working people, and by delivering pensions dashboards that will help individuals to make informed decisions about their financial futures.”

The de-prioritising of pension savings chimes with research this week that found 38% of furloughed workers said they would be putting back their retirement dates, while ONS also finds pension contributions fell 11.2% in Q2 of 2020.