How to boost your pension
March, 2026For most people, private and workplace pensions will be an important source of income in retirement. So, the fact you are already building a pot of money for the future is really positive.
But is the money you have already saved working as hard as it can for you? And what else could you do to increase the size of your pot because a bigger pension should mean more flexibility and more opportunities as you approach and enter retirement. You might even find you can cut down or stop working sooner than you thought.
Whether you are five, ten or even fifteen years from retirement, this blog sets out five steps and checks to help you boost your pension.
- Make the most of your workplace pension
All UK employers are legally required to offer a workplace pension scheme to employees aged between 22 and the State Pension age and earning more than £10,000 per year. Each year, you contribute a minimum of 5% of your salary, and your employer must add at least 3%.
This employer contribution is effectively free money, which makes a workplace pension extremely valuable. So, if you initially opted out, it’s well worth opting back in if you can. And if you are already saving into a workplace scheme, there are ways to give it a boost.
Matching contributions
Some employers will match contributions. let’s say you contribute an extra £50 a month and your employer matches it; that’s an extra £100 a month going into your pension before tax relief is even considered. If this is something your company will do, it’s a great way to boost your pot without taking on the full burden of extra contributions.
Explore salary sacrifice
With salary sacrifice, you give up a portion of your gross salary, which your employer then pays into your workplace pension. It means more money in your pot. And there’s a chance your take-home pay will not be affected because you usually pay less national insurance and income tax as a result.
If your employer does offer this as a benefit, ask them to talk you through the pros and cons. While it’s usually a good thing to do, it’s not right for everyone. This is one of the many things we would check if you asked us to review your pensions and retirement plan.
The rules around salary sacrifice are due to change in 2029, which will likely reduce the positive impact it could have.
- Consider consolidation
Fees and investment performance can have a big impact on the size of any private or old workplace pensions you have. The benefit of reducing fees is straightforward: it means more of your money stays in your pension with the potential to grow. There is more to consider when it comes to performance.
Why pension performance matters
Any private pensions you have will be defined contribution schemes. It’s likely the same applies to your old workplace pensions. This means a lot of the money you save into the pension is invested in stock markets and bonds. And the value of your pension when you retire depends on how much you have contributed and, crucially, how your investments have performed. This is why performance matters so much.
If one or more of your pensions is performing poorly, there’s a good chance this can be fixed by changing how your savings are invested. Even small improvements can make a big difference over time. Investment performance can never be guaranteed, though. And different types of investments come with different levels of risk.
How to make the right call
On the face of it, consolidating any pensions with high fees and a history of poor performance into a better scheme makes sense. But you need to be careful. Getting the balance of your investments right can be tricky. And some pensions have valuable benefits you will lose or penalties you will incur if you transfer out of them.
A regulated financial adviser will help you avoid potentially costly mistakes. Our team has years of experience helping people make the best possible pension decisions. This includes making sure solutions are tailored to each client considering the investment risk they are prepared to take and how long until they plan to retire.
- Contributing more if you can
Building up a pension pot is not easy, so you’ve done well to get to where you are. And contributing more will make a difference. But how do you do that when most of us don’t have much spare cash at the end of each month?
When it comes to pensions, small changes can have a meaningful impact over time. So, it makes sense to start small. If you can, up your monthly contributions by an amount that feels manageable. Then, in a few months’ time, see if you can do the same again. This gradual approach often takes away the financial pain of trying to make a big one-off change.
A pay rise is often a good time to contribute more. Again, aim for a small, manageable increase because you are more likely to make that stick. Your workplace pension is a good starting point, especially if your employer will match any increases you make.
Finally, if you receive a one-off windfall, such as a bonus or inheritance, it is worth adding some of that to your pension pot if you can.
- Check your State Pension
The State Pension will be an essential part of most people’s retirement pot. The amount you will receive depends on your annual National Insurance contributions (also known as qualifying years). You need 10 years of full contributions to receive anything and 35 years to receive the full State Pension.
The good news is, if you are missing qualifying years, you can often buy them back. Read this article to get an idea of the impact this could have on your State Pension.
While it is often a good idea to buy back missing years, it is not right for everyone, and the calculations can get complicated. This is something our friendly team would review for you if you asked for help with your pensions and retirement plan.
- The power of staying invested for longer
It stands to reason that the longer you leave your private and workplace pensions as they are, the more potential they have to grow. Yet many of us are cutting working hours or retiring before the State Pension age1, which means income needs topping up from somewhere.
This is where other savings, such as ISAs, can help bridge the gap. Keping your full pension pot invested for even an extra couple of years could make a big difference to how much money you have to live on. Plus, there is the added benefit that ISA withdrawals are not taxed as income.
Getting the balance right
The bottom line is, everyone’s circumstances are different. So, what’s right for you in terms of boosting your pension pot and eventually accessing these savings could be wrong for your best friend or even your partner.
At Pension Sense, we will create a retirement plan that is tailored to you. If there are sensible and manageable ways to boost the size of your pot, we will help you do that. And we will help you to navigate all the rules and potential pitfalls, so you can make the most of all the money you have worked so hard to save.
