Not yet saving

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.

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.

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.

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.

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.

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.

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.