In Focus: Advice for Women  

Five ways to improve financial security in retirement

There may also be other options for improving your long-term financial security, such as a salary sacrifice scheme that will increase pension contributions.

Reducing earnings via salary sacrifice can impact entitlement to income related employer and government benefits and may not be appropriate for some individuals.

4. Continue contributing even when you’re not enrolled in a workplace pension

You don’t have to be part of a workplace pension scheme to continue adding to a pension.

Whether you’re taking a career break or aren’t eligible for auto-enrolment, setting up your own contributions can help close the gap and keep retirement plans on track.

You can choose to open a personal pension or contribute to existing schemes, such as old workplace pensions.

Even small, regular additions to your pensions can add up over the long term and improve your retirement prospects. You can also choose to add a lump sum to pensions.

5. Weigh up the pros and cons of diverting savings into a pension

When we think of financial security, it’s often the short-term we focus on. 

However, there are benefits to saving in a pension if you have long-term goals.

You will receive tax relief on your pension contributions, meaning an extra 20 per cent will be added if you’re a basic rate taxpayer, and more if you’re a higher or additional rate taxpayer.

It gives your savings an instant uplift. As pension contributions are invested, they also aim to deliver long-term returns.

If you’re in a position to do so, diverting money from your usual savings into your pension can make sense.

However, you need to keep in mind that your pension money will not be accessible until you’re 55, rising to 57 in 2028. As a result, you need to be in a secure financial position and have an emergency fund in place before doing so.

simoney.kyriakou@ft.com