Step 1: Picture Your Ideal Retirement

• Decide when you want to retire (full-time or phased retirement?).

• Estimate how much money you’ll need yearly (think housing, living costs, hobbies, healthcare).

• A rough rule of thumb: 50–70% of your current salary per year in retirement.
  

✅ Tip: Use free tools like MoneyHelper’s Retirement Calculator to get a rough target.

Step 2: Gather All Your Pension Information

• Workplace pensions: Current employer and any previous employers.

• Personal pensions/SIPPs: Any you’ve opened yourself.

• State Pension: Check your forecast at Gov.uk State Pension Forecast.
  

✅ Tip: Keep a simple spreadsheet tracking:

• Provider

• Fund value

• Fund choice

• Charges

• Beneficiaries
  

Step 3: Trace and Consolidate Old Pensions (If Appropriate)

• Use the free Pension Tracing Service at Gov.uk if you’ve lost track.

• Consider Consolidating if:

  • You have lots of small pots.

  • You’re paying high fees.

  • You want easier management.

⚠️ BE CAREFUL IF:

• You have defined benefit pensions (like final salary schemes).

• You’d lose valuable guarantees.
  

✅ Tip: Check for exit penalties and protected benefits before moving anything and seek professional advice if you are unsure.

Step 4: Review Your Current Pension Contributions

• Check:

  • How much you’re contributing (% of salary).

  • How much your employer contributes.

• Minimum auto-enrolment: 5% employee + 3% employer.

• Many employers match higher contributions up to 10–15%.
  

✅ Tip: Always contribute enough to get the maximum employer match — it’s free money!

Step 5: Boost Your Pension Savings (Smartly)

• Increase your own contributions (even 1–2% more helps hugely over time).

• Salary sacrifice: Some employers offer this — saves on both tax and National Insurance.

• Use tax relief:

  • Basic rate taxpayers: For every £80 you contribute, HMRC adds £20.

  • Higher rate taxpayers: Can claim extra tax relief through your tax return.
    

✅ Tip: Extra pension contributions are one of the few "safe" ways to cut your tax bill!

Step 6: Check Fees, Performance, and Risk

• Fees:

  • Annual Management Charge (AMC) ideally under 0.5%–0.75%.

• Performance:

  • Look at 5–10 year returns, not just the past year.

• Risk level:

  • Younger (under 50): Higher equity exposure for growth.

  • Closer to retirement: Shift towards bonds/cash for stability.
    

✅ Tip: Many workplace pensions default to a “lifestyling” glidepath — check if it fits your real retirement plans.

Step 7: Review Your State Pension Position

• Full State Pension is about £221.20/week (2024/25 rates) — about £11,502/year.

• Need 35 qualifying years of National Insurance.

• You can buy back missing NI years if you have gaps.
  

✅ Tip: Plugging an NI gap usually offers a much higher return than investing elsewhere!

Step 8: Set a Regular Retirement Check-in

• Review all pensions at least once a year:

  • Are you still on track?

  • Update beneficiaries.

  • Adjust investments if your retirement timeline changes.
    

✅ Tip: Make it part of your New Year's financial review!

SUMMARY

Planning your retirement as a UK employee means piecing together workplace pensions, personal pensions, and your State Pension into a clear, confident future plan.

Start by gathering all your pension details, trace and consolidate if needed (carefully!), and aim to maximise contributions to capture free employer money and tax benefits. Always keep an eye on fees, investment performance, and risk levels.

The earlier you start — even with small extra contributions — the easier and more comfortable your retirement will be. Make reviewing pensions a habit and you’ll stay firmly in control.