Pension Planning

We want you to get excited about your pension. Because there’s a lot to get excited about. Your pension is one of the best ways to save for retirement and offers lots of valuable benefits.

There’s more to it than just putting money aside too. From understanding tax relief to using your pensions as income, we’re here to help you plan ahead.

What is pension planning?

Put simply, pension planning is helping you to make plans towards your retirement, putting money away and helping you plan for the retirement lifestyle you want.

And if you'd like the ins and outs of planning pensions, explained in a way that’s easy to get to grips with, you’ve come to the right place.

There's more to your pension than meets the eye

  • Any growth in your pension is free from income and capital gains tax.
  • Basic rate taxpayers receive an extra £20 in tax relief for every £80 they contribute.
  • Higher rate and additional rate taxpayers can claim an extra 20% or 25% tax relief through self-assessment.
  • Typically, you can contribute up to 100% of your earnings (up to £40,000) a year.

The power of the workplace pension

All employers have to offer a workplace pension - and it shouldn’t be underestimated. In most cases, for every contribution you make to yours, your employer will make a contribution too (based on certain rules). If you’re not sure how much you’re contributing, it’s worth checking to see if you can put in more. Even if it doesn’t seem like much, a bit extra can make a big difference over time. If you're self employed we can also help you consider potential ways to build your pension pot.

Building a Retirement pot - our webinar

How to calculate the rough cost of your retirement, while looking at ways you could support your lifestyle.

Register to watch

We're here for the late starters too

Obviously, the sooner you start saving into your pension, the more money you’re likely to have when you retire. But we’re here for every stage in life. So even if you think you’ve left it too late – talk to us. We might be able to help with personal pension advice to suit you.

Important information about your pension

A pension is a long term investment and your Capital is at Risk. Your fund value will fluctuate and can go down. You could get back less than you paid in. Your eventual income will depend upon the size of the fund at retirement, future interest rates & tax legislation.

Why choose Skipton for pension planning

At Skipton we're helping customers achieve a more fulfilling retirement. All you need to do is provide us with a few details about the pensions you have, and we will contact all your providers on your behalf. We’ll then provide a personalised report about how your plans stack up. And if needed, we can offer you personalised advice on making better plans.

No pressure promise

We'll never push you into taking up a recommendation or service you don't want or need.

No implementation no charge

You'll only be charged if you decide to implement your financial plan.

Retirement planning experts

Your adviser will discuss with you your current lifestyle and financial situation, and build a plan tailored to your needs.

Frequently Asked Questions

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How long does it take Skipton to review my pensions?

The great thing about our Pension Review service is we will do all the hard work. Your pension providers will supply us with detailed information, which will allow our in-house experts to analyse the strength of your plans.

This research will take a few months to compile. But at the end, we promise you'll be in a position to make informed decisions about your future.

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How much should I pay into my pension?

If you’re currently working and paying taxes, you should be able to count on the state pension to provide you with some support in retirement. The current rules are that you need to have made at least 10 years’ National Insurance contributions to get the minimum state pension amount.

If, by the time you reach state pension age, you’ve made 35 years’ National Insurance contributions, you’ll potentially get the full state pension.

It is important to note that a state pension will only cover a basic retirement. Having a private pension as well is a must in order to achieve a better quality of life, when you need it most. You should only contribute what you can afford and make the most of an employee pension scheme, which means your employer pays in to you pension too. This can make a real difference to its overall value in the long-term.

Remember the sooner we start saving for retirement, the better off those retirement years are likely to be.

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How much pension do I need?

This answer can differ wildly for people. It all comes down to what type of lifestyle you want when you retire. Your golden years can be the most precious time of your life. If your goal is to take holidays, lose yourself in your hobbies, volunteer for important causes, you just need a plan in place and a commitment to follow it.

Research from Which? has shown that a retiree’s household spent just under £2,110 a month, or around £25,000 a year, on average. This covers all the basic areas of expenditure and some luxuries, such as European holidays, hobbies and eating out. Aiming for this as the minimum level of income will provide a good platform for your retirement.

Delving further in to the research, it’s reported that you’d need £40,000 a year if you include luxuries such as long-haul trips and a new car every five years. Your priorities can change slightly as you move through your retirement years though. This can mean spending less on food and drink, housing payments and recreation as you get older.

Beyond leisure activities, it is important to consider day-to-day life when planning your retirement pot:

  • You’ll need an income to cover your bills and essentials like food.
  • You might want to support your family financially, such as contributing towards university costs or to help fund a wedding.
  • Finally, you might want to hold some money back for later in life, in case you or your partner need long-term care.
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What are the differences in a private pension for self-employed?

If you’re self-employed, saving into a pension can be a difficult habit to develop. More so than for those in employment receiving employer pension contributions.

Most self-employed people use a personal pension for their pension savings. With a personal pension you choose where you want your contributions to be invested from a range of funds offered by the provider.

There are three types of personal pension available:

  • Personal pensions – these are offered by most large providers.
  • Stakeholder pensions - where the maximum charge is capped at 1.5% and you can stop and start premiums without penalty.
  • Self-invested personal pensions - which have a wider range of investment options, but usually come with higher charges.

As someone who’s self-employed, you may actually decide that you may not wish to use a pension, to allow more access to readily available funds. As you need to be 55 to access a pension, you may wish to ensure that your business has enough capital, by using savings or investment options instead.

Many self employed people also decide to sell their business when they choose to retire, to fund their retirement plans. This strategy though assumes they will be able to sell their business at that time (and at a good price).

Get in touch

Speak to us on

0800 731 5342

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Site intended for UK residents only. Skipton Building Society is a member of the Building Societies Association. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, under registration number 153706, for accepting deposits, advising on and arranging mortgages and providing Restricted financial advice. Principal Office, The Bailey, Skipton, North Yorkshire, BD23 1DN.

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