{"id":505026,"date":"2026-03-31T10:42:26","date_gmt":"2026-03-31T10:42:26","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/505026\/"},"modified":"2026-03-31T10:42:26","modified_gmt":"2026-03-31T10:42:26","slug":"pensions-warning-over-5-rule-as-expert-says-to-maximise-this-scheme-personal-finance-finance","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/505026\/","title":{"rendered":"Pensions warning over 5% rule as expert says to ‘maximise’ this scheme | Personal Finance | Finance"},"content":{"rendered":"

\"A<\/p>\n

An expert has shared some tips around pensions (Image: Getty)<\/p>\n

People have been urged to read up on some key rules around pensions. Savings experts have shared several tips on how to ensure you have enough saved up for retirement.<\/p>\n

Andrew Prosser, head of Investments at investing platform InvestEngine<\/a>, explained the key principles to remember when it comes to building up your funds for your golden years. He said: “To ensure a secure retirement, individuals should focus on maximising contributions, consolidating pensions, and taking full advantage of tax relief.”<\/p>\n

The expert said a good place for many people to start is by looking at their workplace pension contributions. He said: “Start by maximising workplace pension contributions. Under auto-enrolment, employees typically contribute 5 percent of their qualifying earnings, with employers adding at least 3 percent.<\/p>\n

Read more: State pension update over changes to National Insurance qualifying years <\/a><\/p>\n

Read more: State pension rule change alert over ‘different retirement ages’ <\/a><\/p>\n

“Many employers offer higher contributions or even match additional contributions, which can significantly boost your retirement savings.” Another option you can look at is a self-invested personal pension (SIPP), where you can get tax relief on your pension contributions, similar to a workplace scheme.<\/p>\n

Tax relief benefits<\/p>\n

Mr Prosser explained the tax advantages: “Contributions to a SIPP receive Government tax relief, effectively increasing the amount invested. For example, if a basic-rate taxpayer (20 percent) contributes \u00a38,000, the government adds \u00a32,000, making a total of \u00a310,000 in the pension.<\/p>\n

“Higher-rate (40 percent) taxpayers can claim additional relief of up to \u00a32,000, and additional-rate (45 percent) taxpayers up to \u00a32,500, making contributions an effective ‘guaranteed return’. On top of this, investment growth in a SIPP is free from capital gains tax, and income tax is deferred until you access the funds.”<\/p>\n

If you create a SIPP with InvestEngine, they do not charge any platform fees, allowing you to keep more of your money invested in the scheme. This can make a big difference over the long run – if you paid in \u00a3500 a month for 40 years with a 5 percent annual return, you could lose out on \u00a3130,000 if you had to pay 0.75 percent annual fees.<\/p>\n

This may reduce your fees<\/p>\n

You may also want to track down and consolidate any old pensions you have. Mr Prosser said: “The average UK worker holds nine jobs during their career and often ends up with multiple pension pots. Bringing them together simplifies management, gives a clearer picture of your retirement progress, and may reduce fees.”<\/p>\n

He explained how to recover any lost pension pots you may have. The investment expert said: “To find lost pensions, start by listing all previous employers. If you suspect gaps, the Government\u2019s Pension Tracing Service can provide contact details for former pension providers.<\/p>\n

“Once located, transferring pensions to a single provider like InvestEngine can make them easier to manage. Consolidation allows you to monitor your investments, optimise contributions, and in some cases, benefit from transfer incentives.”<\/p>\n

InvestEngine offers \u00a35,000 cashback when making a pension transfer from many major pension providers.<\/p>\n","protected":false},"excerpt":{"rendered":"An expert has shared some tips around pensions (Image: Getty) People have been urged to read up on…\n","protected":false},"author":2,"featured_media":505027,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[84,2215,4176,5107,4174,3489,4175,4204,119794,7087,2221,56,54,55],"class_list":{"0":"post-505026","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-business","9":"tag-dwp","10":"tag-finance","11":"tag-pension","12":"tag-personal-finance","13":"tag-personal-finance-section","14":"tag-personalfinance","15":"tag-retirement","16":"tag-retirement-section","17":"tag-retirement-age","18":"tag-state-pension","19":"tag-uk","20":"tag-united-kingdom","21":"tag-unitedkingdom"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/505026","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=505026"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/505026\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/505027"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=505026"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=505026"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=505026"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}