FAQs for Workplace Pensions

For many people, joining a workplace pension is a good way of building up a pot of money to provide an income in retirement. You'll get tax relief on your contributions and your employer may pay in too, giving a significant boost to your savings.

However there may be times when paying into a pension may not be the best option. For instance if you have outstanding debts which need to be paid off or there are other financial priorities. Saving into a pension plan is not for everyone. Joining a plan may not be suitable for you, particularly if these savings could affect your entitlement to any means tested state benefits.

Your employer may also stop paying in to your pension if you stop, check with your employer.

Please note, you may have to pay tax when you take money out of your pension.

A personal or workplace pension where contributions and investment performance dictate how much money you have available to provide an income for retirement. Also referred to as ‘money purchase’ schemes as whatever pot you have built up can be used to provide an income in retirement.

The most common type of defined benefit scheme is a final salary scheme. The benefits depend on:

• Your number of years of service.
• Your final salary at the time you stop working for the employer.
• The accrual rates of the scheme (determined by your employer), which determines the percentage of your final salary you will get.

Defined benefit schemes can be:

• Contributory - both the employer and employee pay contributions to provide benefits.
• Non-contributory - only the employer pays contributions.

For further information on defined benefit schemes please speak to a financial adviser. 

Legal & General offer a Retirement Advice Service. Our advisers are experts in retirement regulated by the Financial Conduct Authority , so you can trust them to provide impartial advice and a personal recommendation that’s right for you.

Since 2012, employers have been required to automatically enrol their eligible employees into a workplace pension scheme. If and when you’re notified that you’ve been automatically enrolled, you can choose to opt out, but you may be missing out on benefits, such as contributions from your employer and tax relief.

Your employer is required to enrol you again every three years if you are still eligible and not currently a member of their pension scheme. You will have the right to opt out again.

Find out about automatic enrolment PDF: 271KB  

If you are eligible, you'll be automatically enrolled into the pension scheme. Yours and your employer's contributions will be put into the default investment option. You’ll be able to move your money into the investment options of your choice once we have received your first contribution.

Once you've been enrolled you'll receive a notification explaining the pension scheme and your options to stay in or opt out.

If you’re automatically enrolled you can visit WorkSave Choice (subject to your scheme using Choice) to review your scheme and personal details or to opt out if you do not want to stay enrolled in your workplace pension scheme.

Even if you are not eligible to be automatically enrolled, you may still be able to join your workplace pension scheme. Talk to your employer about how you can join.

You can stop contributions to your pension at any time without penalty. We'll still take charges from your fund even if you stop contributions.

You can restart contributions at any time, again without penalty. If your employer is deducting the contribution from your salary they may restrict when you can restart. Your employer will also have to auto-enrol you into their scheme again every three years if you are still eligible.

Think about why you've decided to stop contributions, as it will have an effect on your retirement income. It's worth bearing in mind that saving regularly can be easy to stop but difficult to start up again. After a month or so you may not notice the contribution going from your salary, but if you decide to stop, starting again can be hard. Your employer may also stop paying in to your pension if you stop, check with your employer.

Use our retirement planning tool to help you plan ahead and see if you're on track to fund the retirement you want.

If you’ve previously opted out of the scheme, re-enrolment is an opportunity to start saving into your pension pot. Your employer is required to enrol you into the workplace pension scheme every three years if you’re still eligible and not currently a member of their pension scheme.

You have the right to opt out again within one month of being re-enrolled.

Although your pension with Legal & General may accept transfers, we would always recommend you speak to a financial adviser before transferring any other pensions you have to us.

Your other pension providers may charge you if you transfer out of their plan. There may be other benefits or guarantees attached to your pension that you might forfeit if you decide to transfer it. If you are a member of a defined benefit scheme with a transfer value of more than £30,000, you’ll need to take advice from an adviser authorised by the Financial Conduct Authority before you can transfer it.

Legal & General offer a Retirement Advice Service. Our advisers are experts in retirement regulated by the Financial Conduct Authority , so you can trust them to provide impartial advice and a personal recommendation that’s right for you.

If you decide not to speak to a financial adviser, you can contact our Employee Support Team on 0345 070 8686 to discuss transfer options that may be open to you. 

Lines are open between the hours of 8:30am and 7pm Monday to Friday.

Call charges will vary. We may record and monitor calls.

You can contribute up to 100% of your relevant earnings or £3,600 gross, if greater, into your pension plan and still get tax relief.

If your contributions go over the annual allowance including employer contributions (currently £60,000 in the tax year 2024/2025) you will incur a tax charge up to the highest rate you pay.

For those with earnings over £200,000 a year, and £260,000 a year when total pension contributions are included, the annual allowance may reduce below £60,000 but not less than £10,000. Please note it may be possible to carry forward unused annual allowances from up to three previous tax years.

If you have started drawing a flexible income from your pension pot, your annual allowance will reduce to £10,000 a year (this is called the Money Purchase Annual Allowance (MPAA)) and you can't carry forward any unused allowances. If you want to carry on building up your pension pot this may influence when you start taking income. Taking your tax-free cash lump sum without any other income doesn't affect your annual allowance.

You will need to check your policy documents or member’s booklet to find out whether you have a:

• WorkSave Pension Plan
• WorkSave Mastertrust Plan
• WorkSave Pension Trust
• Group Stakeholder Pension Scheme
• WorkSave Buy Out Plan
• Trustee Buy Out Plan

You can find more information about the investments available to you by logging into your online account or visiting your scheme microsite/website. Our ‘Funds’ section lists the investments generally available to each of the above products. Your scheme may have chosen different investments for you than those listed.

The vast majority of people who join a workplace pension scheme invest in its default investment option which is designed to be broadly suitable for the majority of savers. You should remember that a default option has not been assessed against your own personal circumstances and so it might not be the right investment choice for you.

If you wish to choose your own investment options, we can help you understand the things you need to take into account. An important element of this is how much investment risk you're prepared to take in pursuit of a higher potential return.

A lifestyle is an investment strategy that changes the funds you are invested in as you approach your retirement date. They typically invest your money in funds that offer the potential for long term growth when you’re a long way from your retirement date. Then, as you approach retirement, they switch your money into different funds generally with the aim of reducing volatility or targeting a specific investment objective.

Please note - you can't combine a lifestyle profile with any other fund for any one benefit type, e.g. regular contributions, or a single contribution or transfer value. If you're already invested in a lifestyle profile and want to change your investment, you'll have to switch your existing pot and redirect any future payments for that benefit type. Likewise, if you'd like to start investing in a lifestyle profile, you’ll have to switch your existing pot and redirect future payments into the lifestyle profile for that benefit type..

Learn about lifestyle profiles.

If your scheme allows, you can make changes to your investments by logging in to Manage Your Account. Here you will be able to see all the funds available to you and make changes. You will also find a personalised pension video statement. It's based on your current pension pot, its projected performance, and how much retirement income it could provide.

Your Guide to Investing outlines some important things to think about before making changes to your investments.

If you do not wish to use our online service to change your investments you can complete our Changing Your Investments form or call us on 0345 070 8686. We're open 8.30am - 7pm, Monday to Friday. Calls may be recorded and monitored. 

Please note - you can't combine a lifestyle profile with any other fund for any one benefit type, e.g. regular contributions, or a single contribution or transfer value. If you're already invested in a lifestyle profile and want to change your investment, you'll have to switch your existing pot and redirect any future payments for that benefit type. Likewise, if you'd like to start investing in a lifestyle profile, you’ll have to switch your existing pot and redirect future payments into the lifestyle profile for that benefit type.

Learn about lifestyle profiles

The value of your pension pot may fall as well as rise, and is not guaranteed. You should choose your funds carefully and review them regularly, particularly if you are close to retirement.

Upon leaving your current employer you'll have some options available to you with regard to your pension.

• The plan will still be invested for you and annual management and fund management charges will continue to be deducted. You may be able to continue payments or start again in the future depending on the type of scheme your new employer has set up. Please note, if annual management charges plus fund management charges are greater than any fund growth, the value of your investments will reduce.
• At any time in the future, you can transfer the pension you hold with us to another provider. We won't charge you to do this.

As soon as we receive the last payment from your old employer, we'll send you a leaver's pack which will explain all your options in more detail.

You can change your contact details now by logging into your online account.

Alternatively you can complete our online form.

Our privacy policy tells you how Legal & General collect and store your personal information.  

Adding a beneficiary means nominating someone you wish to receive any benefits from your pension in the event of your death.

The best way to provide us with your beneficiary details is by logging into your online account.

If your pension contributions come straight from your salary then you need to tell your payroll department about any changes you wish to make to them. Your employer may also restrict the number of times you can do this in a year.

If you pay by your own direct debit simply call us or send us a letter or email, quote your plan number and tell us what you'd like to change your payments to. You can increase or decrease your regular contributions, but you may have to meet a minimum amount.

If you have been automatically enrolled, you can opt out within one month and you’ll get your money back and be treated as if you never joined the plan. Your enrolment communications will explain how to do this. If you don’t opt out within one month of being automatically enrolled you can stop contributing at any time. If you do this, both your contributions and any made by your employer up to that point will remain invested in your pension pot until you take your benefits, or you can transfer them to another pension scheme.

If you have not been automatically enrolled, after you have joined the plan, we will send you a letter containing details of what you will need to do if you decide to cancel and ask for any money back that you have paid. The letter includes a form, called a ‘cancellation notice’. If you decide to cancel, you will need to complete this notice and post it back to us at the address shown on the notice within 30 days of receiving it.

After this period HMRC rules state that your money must remain invested in a pension scheme until you take benefits. For the vast majority of people this will mean that you won’t be able to take benefits until you have reached age 55 rising to age 57 from April 2028.

Our retirement planning tool helps you understand how much you may need to pay in based on the retirement income you hope to get. If you join or are already in a company pension scheme, you should receive an annual statement from your pension provider showing the progress of your savings over the last year.

The size of your pension pot will depend on how much you pay in and for how long, together with how your chosen investment funds perform and the charges you pay. Generally speaking, the sooner you start and the more you pay in, the more you'll benefit at retirement.

Don't forget you may want to take into account any other savings or investments that you're relying on to provide an income when you retire.

In general, tax treatment depends on your individual circumstances and may be subject to change in the future.

If you are uncertain how to proceed we recommend you seek financial advice. 

Legal & General offer a Retirement Advice Service. Our advisers are experts in retirement regulated by the Financial Conduct Authority , so you can trust them to provide impartial advice and a personal recommendation that’s right for you.

You become entitled to a State Pension by paying National Insurance contributions during your working life. The more years you have paid National Insurance the larger your State Pension, with the maximum entitlement currently based on contributions of 35 years or more.

Like the name suggests, the State Pension is unlikely to give you enough income to fulfil all your lifestyle wants and needs in retirement. In the current tax year (2024/25), it only gives you £221.20 per week. If you were born before 6 April 1951 (if male) or 6 April 1953 (if female) the basic State Pension is £169.50 per week (for tax year 2024/25). And this amount could be even less if there have been any gaps in your National Insurance contributions record.

You might be able to get more but this will depend on your personal circumstances, for more information visit GOV.UK.

Find out more about State Pensions and see how much you'd be likely to receive from the state when you retire with a State Pension Forecast.

By joining your employer's pension scheme your income in retirement could be significantly more than if you just rely on the state as both you and your employer contribute.

The best place to get information about your options for your scheme is on your employer pension scheme website. If you don't know where that is, check with your employer. There will usually be a link on your employer’s intranet site.

Learn about your options including a guaranteed income, flexible income, lump sums and cash.

You can also download our guide to taking money from your pension PDF: 339KB. 

You can request a retirement quote from our Claims team by ringing them on 0345 070 8686.

Lines are open between the hours of 8:30am and 7pm Monday to Friday. Call charges will vary. We may record and monitor calls.