Top Tips To Improve Your Pension

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Without a pension, you might not be able to retire when you want, or live the retirement lifestyle you’d hoped for. It’s likely you’ll be reliant on the State Pension and other savings you have.

If you already have a pension, you’ve made an excellent start. But leaving your pension to its own devices can be risky.

We have prepared some of our top tips on getting the most out of your pension in 2019.

Review Your Pension Regularly

It has been found that 1 in 4 people have never reviewed their pension plan. This may not affect them whilst they’re still working but it could have serious repercussions for their desired lifestyle in retirement.

Millions of people take the important first time of setting their pension up but fail to follow this up by ensuring the pension is prospering. Regularly reviewing your pension could help ensure it’s on track to provide the retirement income you require.


Consolidate Pensions

It can be difficult to monitor how your pension is doing if you have multiple pension pots held with different companies. Many of us accumulate pensions through different employment periods and when changing jobs, we tend to leave a trail of different pension pots behind. These may be easier to manage if they are consolidated into one pension pot.

This can be done by transferring them into a Stakeholder Pension, Personal Pension or SIPP (Self-Invested Personal Pension). To find out whether consolidation is right for you, please email


Top Up

Joining a workplace pension scheme often used to be enough to provide a comfortable retirement. Final salary schemes were common however, very few people outside the public sector are now offered a final salary scheme. Its now common for people to be offered membership of a money purchase pension, with both employee and employer paying in an agreed contribution. This allows the employee to build an invested pot of money which they can draw when they reach retirement age. However, it is likely that you may need more to secure a comfortable retirement. Often, topping up your pension by making additional contributions may make sense to help towards your desired income for retirement. This could include a lump sum or a regular monthly contribution.

Remember, money in a pension cannot normally be accessed until age 55 (57 from 2028). It is then usually possible to take up to 25% tax free and the rest as taxed income.


Don’t Forget Your Spouse’s Allowance

 Investing in a pension for a non-working spouse or civil partner is not only one of the most tax-efficient ways to save, it may also provide additional tax-free income in retirement.

In most cases, people can receive a certain amount of income before starting to pay tax. This is known as a ‘personal allowance’ and is currently £11,850. This could mean that there is a potential for a tax-free income of £23,700 per couple. Pension income could be one of the best ways to make use of both tax-free allowances.


Sacrifice Salary

 This may not sound appealing but, salary sacrifice, or a bonus sacrifice arrangement can be one of the most efficient ways of contributing to a pension. This involves giving up some salary in exchange for a pension contribution from the employer. In doing so, the employee pays a reduced amount of income tax and, in addition to this, both the employee and employer usually make a national insurance saving.

There are some potential drawbacks to entering into a salary sacrifice arrangement which need to be considered. These include:

  • A reduction in contractual entitlement to sick pay, overtime rates and paternity and maternity pay. Most of these issues can be overcome by the employer maintaining a reference salary on which these benefits are based.
  • Eligibility for certain state benefits or statutory entitlements could be reduced as a result of paying less NI or receiving less pay
  • High earners with adjusted income over £150k could be better off making a personal contribution.


For more information on any of the above tips or to discuss what options may be right for you, drop an email to and one of the team will be in touch.

* This guide is for your information only and is not personal advice. It is based on our understanding of legislation at 12th February 2019 which could change. Unless stated otherwise, all figures apply to the 2018/19 tax year.
*If you are unsure a particular course of action is suitable for your circumstances, you should seek personal financial advice – for any information on this, contact

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