A good pension pot will look after you throughout your retirement. But what is a good pension pot – how much money will you need to rely on once you’ve retired, and how do you know how much to put in? More to the point, what is the average UK pension pot?

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What does a good pension pot look like?

There’s no straight answer to the question of what a good pension pot looks like, as there are a number of different factors to take into account. For example, variables include your age, when you’re hoping to retire, the type of pension you have, and the amount of money you’re expecting to live on once you’ve stopped working.

If you have a defined contribution pension, which is the most common type of pension in the UK, your pension’s value once you’re retired depends on what you’ve paid into it, any fees taken by your provider, and how your investments have performed.

What is the average UK pension pot?

According to the Financial Conduct Authority (FCA), the average pension pot for those aged 55 and over was around £107,300 as of 2022, although this varies widely by age group and region. However, this figure does not include the value of defined benefit pensions or the State Pension.

The Pensions and Lifetime Savings Association (PLSA) has also published Retirement Living Standards to help people gauge how much they might need, depending on the lifestyle they want. For a ‘moderate’ retirement lifestyle, the PLSA suggests a single person would need around £31,300 per year, which includes the State Pension. For a ‘comfortable’ retirement, which includes a little more luxury, a single person would need around £43,100 according to the report.   This would require a private pension pot of around £544,000 and £898,000 respectively, assuming retirement at age 65, full state pension with growth rate of 4% pa and 2% inflation each year, until age 100.

How much to put into your pension pot?

It can be tricky to know how much to put into your pension pot when deciding what sort of contributions to make. This is perhaps the main thing to consider, but it’s also important to think about how much you’ve got in there already and what other sources of income you’re expecting post-retirement. It’s often recommended to put about 15% of your income – pre-tax – into your pension every year while you’re working, but that might not always be possible.

Find out how much is in your pension pot at present – if you’ve got old pension pots from previous workplaces, you can track them down. If you have a financial adviser, speak to them about the merits of combining your pension pots, also known as pension consolidation. At this point, your pension provider should be able to provide you a simple projection of what your pension pot may be at the age you selected you wish to retire. As their projections are based on limited assumptions and are not personalised, you might also want to get an independent forecast from a financial adviser, like our pension specialists.

Once you’ve got a projection, you can discuss your situation with your adviser, who will be able to let you know whether your pension pot size will meet your retirement needs. If not, they can help you decide on how to increase your monthly contributions at a sensible rate.

Retirement Calculator

A useful tool to get a basic understanding of this is our retirement calculator. From your own inputs, you will be able to forecast an estimate of the pension income you will get when you retire and receive a target retirement income to aim for based on your choices. 

Am I saving enough into my pension?

Consider your preferred annual income in retirement, and any other guaranteed sources of income in retirement you may have, such as a state pension. Subtract your guaranteed income from your preferred income, and you’ll see how much you’ll need to make from other sources – including your pension pot. Through your workplace, you may have a final salary or defined benefit pension – these types of pensions can provide you with a guaranteed income for the rest of your life, and you can add it to your projected state pension to see how much you could earn when you’re retired.

If you’re not sure how much income you’ll need once you’re retired, you can make a few calculations to get a rough idea. Just start with your monthly expenditure at present, and then subtract regular costs that might not apply post-retirement; will you still be paying off your mortgage by then, for example? Then subtract other costs – if you’ve currently got dependent children who will be adults by the time you retire, consider how much you’d save as a result. Then, consider other savings you might be able to make, such as taking holidays during term time, and you should have a rough idea.

You might also need some extra money in retirement, whether that’s for treating yourself to luxuries you didn’t have time for while working, medical expenses and care costs as you get older, or helping your grandchildren through university or buying their first home. When saving, it’s best to include a safety margin, rather than just going for the bare minimum.

One last thing to consider is how long your retirement might be. People retire at different ages – and if you retire later, you might not need to save as much, despite potentially being able to save more. If you’re unsure, use 65 as the baseline. Then, estimate how long you might live – you can use a life expectancy calculator for this. According to the Office for National Statistics (ONS), life expectancy at age 65 is now around 19.8 years for men and 22.5 years for women in the UK, based on 2023 data. Of course, this also depends on your lifestyle and health.

What is the 50 – 70 rule?

The 50 – 70 rule is a quick estimate of how much you could spend during your retirement. It suggests that you should aim for an annual income that is between 50% and 70% of your working income.

In other words, if you are earning £100,000 then in retirement you will want to achieve somewhere between £50,000 and £70,000.

This rule should not be relied on as in-depth retirement planning, rather it is the first step in calculating and deciding upon what your ideal retirement expenditure should be. Realistically you will want to look at your employed income and expenditure and then think about what will change in retirement, for instance will you spend less money as you stop commuting? Or more money on holidays? This should then help you to have a more precise and robust expenditure plan for your retirement.

How to check my pension pot

It pays to check your pension pot size on a fairly regular basis, so that you can ensure you’re on track to meet your retirement needs. If there’s an issue, but you spot it earlier, you should be able to fix it with less difficulty.

First of all, it makes sense to request a State Pension statement – you can do so online, over the phone, or by post, as long as you’re aged over 16 and are more than 30 days away from your State Pension age. Then, if you belong to a defined benefit or final salary pension, your provider will usually send over a benefit statement each year, but you can ask for one if you need to. On the statement, you’ll be able to see how much you’re likely to receive with options surrounding whether or not you take some tax free cash. With regards to any defined contribution pensions you have, your annual statements will give you an idea of your future pot value, and the expected retirement income you’re thought to be in line to receive once you retire assuming you purchase an annuity. 

It’s worth bearing in mind that you might have other sources of retirement income too, be they investments or savings. These could include a property that you rent out, share-based investments, or cash deposits, and you may be able to get statements for these, too.

Saving for retirement can be stressful, and it’s not always easy to know how much money to put aside while you’ve got immediate expenses to consider. If you’re uncertain about whether you’re on track or simply want reassurance that your plans are realistic, a conversation with a financial adviser can be invaluable. Get in touch with The Private Office for a free initial consultation with one of our financial advisers.

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

Investments and the income derived from them can fall as well as rise and you may get back less than you originally invested. Past performance is not a guide to future returns.

The Financial Conduct Authority (FCA) does not regulate cash flow planning, estate planning, tax or trust advice.

The information in this article is based on current laws and regulations which are subject to change as at future legislations.

A pension is a long-term investment. The value of an investment and the income from it could go down as well as up. The return at the end of the investment period is not guaranteed and you may get back less than you originally invested.

It’s been a turbulent time for global markets, with headlines dominated once again by political uncertainty in the United States. As Donald Trump edged back into the spotlight, the resulting volatility in global markets created concern for investors everywhere, including those with UK pensions, and this concern shows little sign of abating anytime soon.

While what happens in US politics may seem far removed from your pension pot, global markets are of course interconnected. A shake-up in the US with the war on tariffs, whether economic or political, has rippled across global stock markets, including those that your pension may be invested in. It’s little wonder that those who are retired, nearing retirement, or even still building a retirement savings pot, are concerned, so it's worth understanding what market volatility could mean for you and what you can do to protect your long-term financial stability.

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For those recently retired: keeping your drawdown plan sustainable

If you’ve retired in the past five years and are relying on drawdown of your pension to provide income, stock market turbulence could present real challenges. When investment values fall and you’re withdrawing from your pension at the same time, you may be forced to sell more units to generate the same level of income. This can quickly erode the long-term sustainability of your pension fund, particularly if markets take time to recover.

One of the most practical ways to guard against this is to ensure you have a cash buffer in place. Rather than drawing from your pension when markets are down, using cash savings to cover income needs can help protect the value of your pension and give your investments time to recover. This is known as sequencing risk.  We generally recommend clients hold between three to five years’ worth of “uncovered expenditure” in cash. This refers to the gap between your annual spending and any secure income you may receive from sources like the State Pension or annuities. Having this buffer not only preserves your pension during downturns but also gives you peace of mind and flexibility in uncertain times.

For those on the cusp of retirement: review, don’t react

If you're planning to retire in the next year or so, recent market instability can be especially unsettling. You might be questioning whether your savings will stretch far enough or even wondering if you need to delay your retirement. These concerns are completely valid, but the most important thing to avoid is making knee-jerk decisions based on short-term market moves.

Rather than reacting emotionally, take this opportunity to review your retirement plan. Assess whether your goals remain achievable given the current market backdrop. We use cashflow modelling to help clients understand how their financial future might look under different economic scenarios. This kind of planning is useful not only during turbulent periods, but also when other life circumstances change, such as spending needs or health considerations.

Continuing to contribute to your pension, if possible, remains a smart move. Despite market dips, pensions are still one of the most tax-efficient ways to save. Higher-rate taxpayers, for example, benefit significantly from tax relief, which helps boost long-term returns. Ongoing contributions also allow you to benefit from pound-cost averaging, helping you buy investments at lower prices when markets fall. Over time, this can enhance the overall value of your pension pot.

It’s also a good idea to review your pension’s investment strategy to ensure it aligns with your changing timeline and appetite for risk. For some, this may mean reducing exposure to riskier assets. For others, especially those with longer-term plans, staying invested in growth assets may still make sense. Either way, professional financial advice can help clarify your options and ensure any changes are based on sound financial reasoning, not short-term fear.

For those around 10 years away: stay focused on the long game

If you’re still a decade or more away from retirement, your pension remains in the accumulation phase, and time is very much on your side. While short-term market downturns can feel unnerving, they’re less likely to have a lasting impact on your long-term retirement goals. The key message for this group is simple: avoid panicking and stay invested.

That said, now is a good time to check the specifics of how your pension is managed, especially if you’re in a lifestyle fund. These funds typically begin to switch from equities to lower-risk assets like bonds in the 10 to 15 years before your target retirement date. While the principle is sound, the automatic nature of this switching process can be problematic if it coincides with a market dip. You could end up selling equities at a loss – not because it’s the right financial decision, but because that’s how the fund is structured.

Understanding when your lifestyle fund begins this transition, and whether the retirement age it targets aligns with your actual retirement plans, is essential. If there’s a mismatch, it may be time to take control and ensure the fund’s timeline matches your own. The same goes for those using Self-Invested Personal Pensions (Sipps), where greater flexibility means greater responsibility. Now could be a good time to reassess your asset mix and make sure it remains appropriate for your long-term goals.

Even though this group is less immediately exposed to market volatility, making the right decisions now can make a big difference in the future. Whether it’s tweaking your investment strategy, increasing contributions, or just ensuring your retirement date is correctly reflected in your fund choices, these actions can help keep your pension on track.

Why advice matters more than ever

Political and economic uncertainty is nothing new, but periods of heightened instability, such as the one we’re currently witnessing, highlight just how important it is to have a robust financial plan in place. Regardless of where you are on your retirement journey, taking a step back to review your situation, rather than rushing into changes, is key.

For many, the support of a professional financial planner can make all the difference. We can help you assess your position, model different retirement outcomes, and ensure you’re making informed decisions that protect and grow your wealth over time. At a time when the headlines can feel overwhelming, having expert guidance tailored to your circumstances can provide much-needed clarity and confidence.

If you’re unsure how recent market movements might affect your retirement plans, or if you simply want to make sure you’re on the right path, now may be the ideal time to get in touch.

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions. 

A pension is a long-term investment not normally accessible until age 55 (57 from April 2028 unless the plan has a protected pension age). The value of your investments (and any income from them) can go down as well as up which would have an impact on the level of pension benefits available.  Your pension income could also be affected by the interest rates at the time you take your benefits

Past performance is not a guide to future returns.

The Financial Conduct Authority (FCA) does not regulate tax advice and cashflow modelling.

The Chancellor previously confirmed that she only wanted to make major tax and spending announcements once a year, with this being in the Autumn Budget.  Therefore, no tax changes were expected and none were delivered.

The headline from the speech was that the Office for Budget Responsibility (OBR) has halved its 2025 growth estimate for the UK from 2% to 1% in 2025, but it has upgraded its longer term forecasts from 2026 onwards.

Alongside this, previously announced cuts to Welfare and Overseas Aid payments, Increases in Defence spending and Planning Reforms were confirmed.

In terms of signposting future changes that could be announced:

• The government confirmed it is looking at options to reform ISAs to “get the balance right between cash and equities to earn better returns for savers” which could indicate limited cash ISA allowances relative to Stocks and Shares ISA allowances.
• The government will also be holding a series of roundtables with key stakeholders over April as it considers the role of tax reliefs for Enterprise Management Incentives Schemes, Enterprise Investment Schemes and Venture Capital Trusts.

After the pension changes over the last few years and, in particular, last year’s confusion as the new pension rules were ‘bedded in’ and legislation adjusted, it was a relief to have no further tinkering with pension rules.

We already know of course, of various areas of impending change, including the removal of the ‘domicile’ tax regime from 6 April this year, the Business Property Relief and Agricultural Property Relief changes from April 2026 and of course the Pensions and IHT changes from April 2027 – which we await further details on.

These areas and others, including the employer National Insurance increases, are covered off in our Autumn Statement 2024 summary.

There were some changes announced to Universal Credit from 2026 onwards and from this summer it will become possible for those newly liable for the High Income Child Benefit Charge to pay the tax through PAYE rather than via self-assessment.

If you’d like to discuss any of the announcements from the Spring Statement or Autumn Budget last October, and are concerned about how they will affect your financial plan, why not get in touch and speak to one of our expert advisers.

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

The Financial Conduct Authority (FCA) does not regulate tax advice.

Planning for retirement requires careful consideration of the best savings vehicles available, and two of the most popular options in the UK are pensions and ISAs (Individual Savings Accounts). While both offer tax-efficient ways to grow wealth, they serve different purposes and come with distinct advantages and limitations. A well-rounded retirement strategy may involve using both, depending on individual financial goals, tax considerations, and evolving regulations.

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The role of pensions in retirement planning

Pensions are designed primarily for long-term retirement savings, offering significant tax advantages that make them an attractive option. One of the biggest benefits is the tax relief on contributions—money paid into a pension receives tax relief at an individual’s marginal tax rate, effectively reducing the amount of tax paid on earnings. For higher or additional-rate taxpayers, this makes pensions particularly valuable, as contributions can benefit from 40% or even 45% tax relief, depending on income levels.

Additionally, pensions provide tax-free investment growth, allowing savings to accumulate over time without being eroded by capital gains tax or dividend tax. When it comes to withdrawing funds, 25% of a pension pot can be taken as a tax-free lump sum, while the remaining balance is subject to income tax. The trade-off for these benefits is that pension savings are locked in until at least age 55 (rising to 57 in 2028), making them less accessible in comparison to ISAs.

The flexibility of ISAs

ISAs, on the other hand, offer tax-free growth and withdrawals, making them an excellent complement to pensions in a retirement strategy. While contributions do not receive tax relief, the ability to access funds at any time without penalty makes ISAs more versatile. This flexibility can be particularly useful for those who may need to draw on savings before retirement or wish to supplement their pension income without triggering additional tax liabilities. ISAs have a limit of £20,000 per individual per tax year and this can be split across cash and/or stocks and shares.

Cash ISAs allow savers to earn tax-free interest, while Stocks & Shares ISAs provide the potential for investment growth with no capital gains or dividend tax on returns. This makes ISAs an attractive choice for those who want to retain control over their savings without the restrictions of a pension. However, recent discussions about potential changes to the Cash ISA framework have raised concerns about its long-term benefits, making it all the more important for savers to stay informed about policy updates.

The changing landscape of pensions and inheritance tax

One of the most significant changes being proposed for pensions  is the planned inclusion of pension funds within the scope of inheritance tax (IHT) from 2027. Historically, pensions have been an efficient way to pass wealth down to future generations, as they have typically fallen outside of an individual’s estate for IHT purposes. This has led many financial advisers to recommend using non-pension savings first in retirement, preserving pension wealth to be inherited tax-free.

However, with the proposed new rule changes, pensions may no longer enjoy this exemption, potentially making them less favourable for wealth transfer. This shift may encourage retirees to draw down on their pensions earlier rather than leaving them untouched, making strategic planning even more essential. Individuals should review their estate planning strategies in light of these proposed changes to ensure they optimise tax efficiency while securing their financial future.

Balancing pensions and ISAs for a stronger retirement plan

Given the unique advantages of both pensions and ISAs, a balanced approach can help individuals make the most of their retirement savings. Pensions remain a powerful tool for long-term wealth accumulation due to tax relief and employer contributions, but they have some limitations on access and flexibility and could soon be subject to inheritance tax. ISAs, while not offering tax relief on contributions, provide tax-free growth and withdrawals, making them an excellent complement for early or flexible access to savings – but are limited to £20,000 contribution per tax year.

Younger savers may prioritise pensions to take full advantage of employer contributions and tax relief, ensuring they build a solid foundation for the future. Meanwhile, those approaching retirement may benefit from shifting some focus to ISAs, allowing for accessible savings that can be drawn upon without incurring additional tax burdens. Given the proposed changes to pension inheritance tax, retirees may also need to rethink how they draw down their savings, potentially using pensions earlier than previously advised.

With tax laws and regulations evolving, seeking professional financial advice is crucial to navigating the complexities of retirement planning. A tailored strategy that considers tax efficiency, investment growth, attitude to risk, and changing policies can make a significant difference in long-term financial security. By carefully balancing contributions between pensions and ISAs, individuals can build a more resilient retirement portfolio that aligns with their goals and adapts to the shifting financial landscape.

We’re currently offering anyone with £100,000 or more in pensions, savings or investments  a free initial financial review worth £500. If you’d like to learn more, get in touch for an initial consultation to see how we can help.

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions. 

The Financial Conduct Authority (FCA) does not regulate tax planning.

Investment returns are not guaranteed, and you may get back less than you originally invested. Past performance is not a guide to future returns.

The information contained within this article is based on our understanding of legislation, whether proposed or in force, and market practice at the time of writing. Levels, bases and reliefs from taxation may be subject to change.

Who deals with the finances in your household? Would your family know where to look should something happen to you?

In the past, having a will would be how your final wishes were granted for the distribution of your assets after death…

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But is it enough in the new digital world?  

As the financial industry transitions towards increasingly using technology, your loved ones are unlikely to unearth your financial information by searching through a physical filing cabinet. Finder, a global fintech, estimates that in the UK alone, 47 million people use some form of online or remote banking – that’s 87%!  In the last decade especially, each of our digital footprints has grown exponentially. With multiple logins, passwords, usernames and accounts held across different websites and portals it’s hard to keep track yourself. The question is, how would your loved ones cope with this should you pass away?

No one can dispute that navigating the death of a loved one is one of life’s biggest challenges. To further complicate things, a recent survey by consumer group Which? has indicated that 76% of members surveyed had left no plan for what to do with their digital assets should they die.

Removing the additional complexity of trying to locate relevant documents to settle your estate can only be of benefit to those you leave behind. Although you can name a ‘digital executor’ in your will, this does not extend to consolidation of your financial affairs into one accessible place. TPO Wealth solves this problem for you.

What is TPO Wealth?

At The Private Office, all our clients have access to a digital filing cabinet, at no additional cost, through our secure online portal TPO Wealth. As with a physical filing cabinet, here documents can be stored safely and securely. By leaving behind instructions for family members on how to access this, the painful process of settling your estate can be expediated and enhanced.

With your consent, your solicitors and accountants can also access information you deem appropriate, such as tax returns. This capability allows for a seamless and effortless experience for you. You can have confidence that your information is safe, whilst allowing trusted contacts to have access to relevant documents.

Our clients use TPO Wealth to file personal financial documents and those they choose to share with professional contacts, such as their:  

• Tax Information 
• Will 
• Invoices 
• Details of professional contacts 
• In case of emergency details 

This can be particularly useful for the self-employed. As of October 2024, the statistical agency Statista estimates that 4,383,000 people in the UK are self-employed. That’s 13.1% of the workforce! Granting your accountant access to secure documents on TPO Wealth could substantially speed up the arduous process of filing tax returns and completing annual accounts.

With all the information neatly stored in one place, the need for time consuming back-and-forth is reduced. You’re free to get on with life’s more important things.

What about if you become incapacitated? 

Beside from the death of a loved one, information may be required, in other instances. Consider critical illness or incapacity. Should something happen to you, access to your TPO Wealth account and those within the remit of your Power of Attorney rights can be granted. Ministry of Justice data from 2024 indicates just how slow the Lasting Power of Attorney process can be – in fact, one application was finally processed in 2024 after a total of 2,777 working days!  

Would you like to take control of your finances?

Beyond secured storage of important files, with TPO Wealth you can track investment performance and the growth of your savings, across various accounts with different providers, all in one place. Using clear graphics, our clients can track the value of their net-worth in real time. Features such as an in-built property value calculator contribute towards overall peace of mind, as you can get a clear picture of the state of your finances, all at your fingertips.

If you’d like to learn more about how TPO Wealth can help to consolidate your financial affairs into one simple, easy-to-use place, we would be happy to help.

So why not get in touch?

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions. 

TPO Wealth is only available to clients of The Private Office.

The Financial Conduct Authority (FCA) does not regulate estate planning or tax advice. 

According to studies by the Financial Conduct Authority, there is a staggering number of people in the UK who do not seek financial advice. This is known as ‘The Advice Gap’ and the number has been put at 39 million.

As an adviser with nearly 40 years in the business it does not necessarily surprise me that there is a great deal of reluctance. Much of the UK’s wealth resides with the Baby Boomers, many of whom can remember what financial advice used to be like in the 70s and 80s. The high levels of professionalism which exist in the industry today, were a thing of the future. Even as late as the mid 80s (when there was no regulation) one insurance company rep (I will desist from mentioning any names) cited that in his first job (in Swansea) one of his best producing ‘advisers’ was a butcher who also sold life insurance policies to his customers, presumably in conjunction with two pounds of mince!

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I have witnessed the complete transformation of this industry. The advisers of today are well educated and highly qualified people with, perhaps most importantly, a high degree of integrity. There is no resemblance to the ‘wild west’ of old but, of course, I have sympathy for any individuals (and there are many) who had a bad experience in the past.

But baby boomers with unhappy memories aside, there is still a great deal of misunderstanding about the value an adviser can add.

In 2022 the Financial Conduct Authority (FCA) conducted research and found that 60% of people with investable assets of £10,000 or more considered that they wouldn’t benefit from financial advice. Another survey by the Financial Services Compensation Scheme (FSCS) indicated that 23% of people felt they didn’t have sufficient wealth to warrant advice and 38% considered advice to be too costly and didn’t represent value for money.

What does value for money represent?

In stark terms this can be viewed as asking the simple question “would I have more money at the end of the day with or without and adviser?” and this is a fair question. Most ‘sceptics’ will simply look at portfolio returns only. Of course, performance returns are very important but in the context of holistic financial advice, it is only one factor.  

This point can be illustrated well by an experience I had with a client I had just acquired back in 2017, who was drawing down money from a pension and paying 40% tax for the privilege. The same client had considerable wealth held outside of the pension and by running cashflow projections, I was able to demonstrate that by directing the income away from the pension and taking it from pension investments, at the end of his life (assumed to be the life expectancy given his age) his estate would be over £300,000 better off. This was simply a tax observation and had nothing to do with the performance of underlying portfolios.

We would all be great investors if we had a crystal ball!

On the subject of portfolios there is also a tendency for would be clients to look at performance in the rear mirror and conclude that self-investing would result in a higher net return. We would all be great investors if we had a crystal ball! The most common trait of the amateur investor, particularly when markets are doing well, is to increase the risk of the portfolio and then, when a market crash comes, all of a sudden, those high performing investments are often the first to fall off a cliff.  

One of the responsibilities of a good adviser is not only to ensure that your money grows well but to ensure than when times are tough, you are sufficiently protected. This is particularly true for retired clients who are in the ‘decumulation’ stage, the point at which you start to draw on your retirement funds. They have worked hard all their lives to build up a pot for retirement and it must be structured in such a way that, if there is a market crash (and there will be one sooner or later), they can continue to draw an income without losing sleep. This can only be done by managing the overall risk and making sure there is sufficient ‘low risk’ investment in the short term to ride the market turmoils.

How to quantify the Value of Financial Advice

In 2019 the International Longevity Centre (ILC) conducted a survey to quantify the value of advice in monetary terms. Over the course of a 10-year period, on average, those who sought advice saw their wealth increase by a whopping £47,706, twenty-four times higher than the average initial fee for the advice.

It is not only the hard benefit of pounds and pence. A Royal London study examined the emotional benefits of having a trusted adviser on board. Peace of mind scored highly. Most people want to enjoy their lives without feeling anxious about their finances. 

A good financial adviser can often provide reassurance, particularly if a projection of finances (using cashflow tools based on cautious assumptions) indicates that life goals can be achieved.

Achieving one’s goals is like climbing a mountain. It takes preparation, equipment, skill and determination to get there, and I don’t know about you, but if I were taking on Everest, I’d rather do it with a good sherpa by my side!

Ultimately, it hinges on trust, and the industry has created a landscape populated by well-equipped advisers who are highly regulated, and duty bound to work in the clients’ best interests. According to the Langcat Report 91% of people considered their advice to be helpful and valuable.  

Some readers will be old enough to remember Red Adair. A colourful character, Red was the only person in the world capable of extinguishing raging fires on oil rigs (an alarmingly regular occurrence back in the 70s). He also charged accordingly and when challenged on his fees he replied “If you think it’s expensive hiring a professional, you should try hiring an amateur!”.

If you would like to learn more about how we can help, why not get in touch and speak to one of our qualified advisers for a free initial consultation.

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This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

Investment returns are not guaranteed, and you may get back less than you originally invested. Past performance is not a guide to future returns.

The Financial Conduct Authority (FCA) does not regulate cash flow planning, estate planning, tax or trust advice.

In one of the longest ‘Budget’ speeches in memory, Chancellor Rachel Reeves gave the first Labour Budget speech for nearly 15 years on 30 October 2024.  

Here we’ve summarised the main elements of interest for financial planning, with further details on tax rates and allowances for 2025/26 (to compare to 2024/25) available on the government website.  

If you have any concerns or questions about any of the announcements and would like to speak to one of our expert financial advisers, contact us for a free initial consultation to see how we can help.

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Non- domicile changes

The non-domicile tax regime is to be abolished from 6 April 2025. Domicile will no longer be a feature of the UK tax system and will be replaced by a system based on residency.

The government will:  

• Introduce a new 4-year foreign income and gains regime for new arrivals who have not been UK tax resident in the previous 10 years
• Allow individuals previously taxed on the remittance basis to remit pre-6 April 2025 foreign income and gains using a new Temporary Repatriation Facility
• Reform Overseas Workday Relief
• Replace the domicile-based system for inheritance tax with a residence-based system

VAT on private school fees

From January 2025, 20% VAT will apply to private school fees across the UK and the business rates charitable rates relief for private schools in England will be removed.

Income tax and personal National Insurance (NI)

Income tax bands and personal NI thresholds remain frozen until April 2028. This time period hasn’t been extended and from 2028/29 these bands/thresholds will increase with inflation.

Capital gains tax (CGT) changes

Investors’ Relief

Investors’ Relief (IR) provides for a lower rate of CGT to be paid on the disposal of ordinary shares in an unlisted trading company where certain criteria are met, subject to a lifetime limit of £10 million of qualifying gains for an individual.

This measure reduces the lifetime limit from £10 million to £1 million for IR qualifying disposals made on or after 30 October 2024.

CGT rates

The main rates of Capital Gains Tax (that apply to assets other than residential property and carried interest), will increase from 10%/20% to 18%/24% respectively for disposals made on or after 30 October 2024.

The main rate of Capital Gains Tax that applies to trustees and personal representatives will increase from 20% to 24% for disposals made on or after 30 October 2024.

The rate of Capital Gains Tax that applies to Business Asset Disposal Relief and Investors’ Relief is increasing to 14% for disposals made on or after 6 April 2025 and from 14% to 18% for disposals made on or after 6 April 2026.

Carried interest

Carried interest, which is a form of performance-related reward received by fund managers, primarily within the private equity industry, will be subject to a CGT rate of 32% from April 2025 (current rates are 18% and 28%). From April 2026, carried interest will be subject to a revised regime within the income tax framework.  

Inheritance tax (IHT) changes

Freezing of IHT thresholds

The Inheritance Tax thresholds were already fixed at their current levels until April 2028. This time period has been extended to April 2030. This measure will fix the:

• Nil-rate band at £325,000
• Residence nil-rate band at £175,000
• Residence nil-rate band taper, starting at £2 million

Inherited pensions

From 6 April 2027, when a pension scheme member dies with unused funds or without having accessed all of their pension entitlements, those unused funds and death benefits will be treated as being part of that person’s estate and may be liable to Inheritance Tax. The current distinction in treatment between discretionary and non-discretionary schemes will be removed.  

The change will apply to both DC and DB schemes. It will apply equally to UK registered schemes and QNUPS. This will ensure that most pension benefits are treated consistently for Inheritance Tax purposes, regardless of whether the scheme is discretionary or non-discretionary, DC or DB.  

A small number of specified pension benefits will remain outside scope for Inheritance Tax, including where funds can only be used to provide a dependants’ scheme pension. These are currently out of scope in non-discretionary schemes and so will remain out of scope under this change.  

Pension scheme administrators will become liable for reporting and paying any Inheritance Tax due on pensions to HMRC. This will require pension scheme administrators and personal representatives to share information with one another.  

A technical consultation has been issued on the processes required to implement these changes for UK-registered pension schemes. After the consultation, the government will publish a response document and carry out a technical consultation on draft legislation for these changes in 2025.

The government will continue to incentivise pension savings for their intended purpose of funding retirement, supported by ongoing tax reliefs on both contributions into pensions and on the growth of funds held within a pension scheme.  

Agricultural relief and business relief  

From 6 April 2025, the existing scope of agricultural relief will be extended to include land managed under an environmental agreement with, or on behalf of, the UK government, devolved governments, public bodies, local authorities, or relevant approved responsible bodies.  

From 6 April 2026, agricultural relief (AR) and business relief (BR) will be reformed, as summarised below:

• The 100% rate of relief will continue for the first £1 million of combined agricultural and business property to help protect family farms and businesses, and it will be 50% thereafter.  
• The rate of business relief will reduce from 100% to 50% in all circumstances for shares designated as “not listed” on the markets of recognised stock exchanges, such as AIM.  

The reforms are expected to only affect around 2,000 estates each year from 2026/27, with around 500 of these claiming agricultural relief and around 1,000 of these holding shares designated as “not listed” on the markets of recognised stock exchanges.  

The government will publish a technical consultation in early 2025. This will focus on the detailed application of the allowance to lifetime transfers into trusts and charges on trust property. This will inform the legislation to be included in a future Finance Bill.

More detail is available at gov.uk. 

National insurance

Employer NI is to increase to 15% (from 13.8%) from April 2025 and the secondary threshold will reduce to £5,000 (from the current £9,100), i.e. employer NI will become payable on an employee’s earnings above £5,000pa.

The Employment Allowance, a National Insurance exemption for smaller businesses, will increase to £10,500 (from £5,000).  

Pensions

Qualifying recognised overseas pension scheme (QROPS)

The Overseas Transfer Charge (OTC) is a 25% tax charge on transfers to QROPS, unless an exclusion from the charge applies.

The government has announced that they are removing the exclusion from the OTC for transfers made on or after 30 October 2024 to QROPS established in the EEA and Gibraltar.

Also, from 6 April 2025, the conditions of OPS and ROPS established in the EEA will be brought in line with OPS and ROPS established in the rest of the world, so that:  

• OPS established in the EEA will be required to be regulated by a regulator of pension schemes in that country
• ROPS established in the EEA must be established in a country or territory with which the UK has a double taxation agreement providing for the exchange of information, or a Tax Information Exchange Agreement

From 6 April 2026, scheme administrators of registered pension schemes must be UK resident.  

Aligning the treatment of transfers to QROPS established in the EEA and Gibraltar with that of transfers to QROPS established in the rest of the world will help to ensure that some UK residents do not benefit from a double tax-free allowance whilst remaining in the UK and reduces the risk of around £1 billion of UK tax-relieved pension savings being transferred overseas across the scorecard.

Changing the conditions EEA schemes need to meet in order to become an OPS or ROPS will mean that they will have to meet the same conditions as those which are established anywhere else in the world.

Requiring scheme administrators of registered pension schemes to be UK resident will mean that all administrators of registered schemes will need to meet the same conditions.    

Further details are available at gov.uk. 

Employee Ownership Trusts and Employee Benefit Trusts

Targeted reforms are to be made to the Employee Ownership Trust tax reliefs to ensure that the reliefs remain focused on the intended purpose of encouraging and supporting employee ownership, whilst preventing opportunities for the reliefs to be abused to obtain tax advantages outside of these intended purposes.

Details are available at gov.uk

Stamp Duty Land Tax (SDLT)

The higher rates of Stamp Duty Land Tax (SDLT) for purchases of additional dwellings (second properties) and for purchases by companies is increasing from 3% to 5% above the standard residential rates of SDLT.  

This measure also increases the single rate of SDLT payable by companies and other non-natural persons purchasing dwellings over £500,000, from 15% to 17%.  

Both changes apply to transactions with an effective date on or after 31 October 2024.  

National Minimum Wage

The National Living Wage will increase from £11.44 to £12.21 an hour from April 2025.  The National Minimum Wage for 18 to 20-year-olds will also rise from £8.60 to £10.00 an hour.

State benefit and state pension increases

From April 2025, a 4.1% increase to the basic and new State Pension meaning the full new State Pension will rise from £221.20 to £230.25 a week, while the full basic State Pension will increase from £169.50 to £176.45 per week.

The Pension Credit Standard Minimum Guarantee will increase by 4.1% from April 2025, meaning an annual increase of £465 in 2025/26 in the single pensioner guarantee and £710 in the couple guarantee.

Working-age state benefits and the Additional State Pension will rise by 1.7% in April 2025, in line with inflation.

Furnished holiday lettings (FHL)

As previously announced, the furnished holiday lettings (FHL) tax regime will be abolished from April 2025, removing the tax advantages that landlords who offer short-term holiday lets have over those who provide standard residential properties.

The current rules provide beneficial tax treatment for furnished holiday lettings compared to other property businesses in broadly four key areas:

• Exemption from finance cost restriction rules (which restrict loan interest to the basic rate of Income Tax for other landlords)
• More beneficial capital allowances rules
• Access to reliefs from taxes on chargeable gains for trading business assets
• Inclusion as relevant UK earnings when calculating maximum pension relief

The abolition of the FHL regime will mean that income and gains will then:

• Form part of the person’s UK or overseas property business
• Be treated in line with all other property income and gains

If you’d like to discuss any of the changes announced in the Autumn Budget or would simply like to explore ways that you can minimise the amount of tax you pay on your wealth, why not get in touch and speak to one of our expert team of advisers. We’re offering anyone with £100,000 in savings, investments or pensions a free financial review worth £500.

Arrange a free initial consultation

This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions. 

The Financial Conduct Authority (FCA) does not regulate cash flow planning, estate planning or tax. 

The information contained within this article is based on our understanding of legislation, whether proposed or in force, and market practice at the time of writing. Levels, bases and reliefs from taxation may be subject to change. 

Nearly 4 months after the general election, Chancellor Rachel Reeves finally delivered her eagerly anticipated Budget this afternoon.

It had been widely reported that there would be tax rises and speculation had been rife that pensions, capital gains tax and inheritance tax could be targeted to raise tax revenue following Labour’s manifesto commitment not to increase taxes on “working people”.

In the end, changes to all three of these areas were announced as Reeves looks to raise taxes by £40bn, though the changes were not to the extent that many had feared.

Arrange your free initial consultation 

Capital Gains Tax

The main rate of Capital Gains Tax will increase for basic rate tax payers from 10% to 18% and for higher rate tax payers from 20% to 24%. This change will take effect immediately. Capital Gains Tax on second properties will remain unchanged.

There had been rumours that capital gains tax rates would be equalised with income tax rates, so the changes could be viewed as relatively modest compared to potential increases of this level.

Pensions

Investors will have been pleased to see that no changes were announced to the maximum tax free cash that can be taken from pensions or the tax relief available on pension contributions. However, it was announced that unused pension funds and death benefits payable from a pension will be included in the value of estates for inheritance tax purposes from 6 April 2027. This will affect individuals who were previously planning to leave their pensions to beneficiaries rather than to spend them in their lifetimes, though income taken from pensions in excess of tax free cash entitlements is subject to income tax and will then form part of the estate for inheritance tax purposes if not spent, so careful planning will be needed to ensure funds are not taxed twice.

Inheritance Tax

Aside from inherited pensions entering the estate for inheritance tax purposes in 2027, there were a couple of additional changes to inheritance tax rules.

Firstly, the freezing of the nil rate band (£325,000) and Residence Nil Rate Band (£175,000) until 2030 was announced. For reference, the Residence Nil Rate Band is generally available when a main residence is passed to direct descendants and this, combined with the nil rate band, generally gives married couples £1m which can be passed to direct descendants inheritance tax free on the second death of them both.

Additionally, there had been rumours that the inheritance tax break on shares listed on the Alternative Investment Market (AIM), if held for two years before death, would be scrapped. However, the Chancellor instead took a ‘half way’ approach by introducing a 20% inheritance tax rate in respect of these shares.

The Chancellor also announced changes to two lesser-known inheritance tax reliefs, Business Relief and Agricultural Relief, which will now be subject to a 20% inheritance tax charge on qualifying asset values over £1 million.

Income Tax, Employee’s National Insurance and VAT

As expected there were no increases in these three areas given they affect “working people”. However, with income tax bandings already frozen until 2028, there was an expectation the Chancellor may extend this date, but this did not prove to be the case, as the Chancellor confirmed the freezing of these bandings would end in 2028.

Given the above changes were not to the level expected, how has the Chancellor raised £40bn?

Employer’s National Insurance

A large proportion of this £40bn (an estimated £25bn) will be funded by a large increase in employer’s National Insurance contributions from 13.8% to 15% and a reduction in the threshold from which these are paid from £9,100 to £5,000.

Stamp Duty on second properties

Landlords will be disappointed to see the stamp duty surcharge on second properties increasing from 3% to 5% with effect from 31 October.

Non-Dom tax status abolished

As expected, the Chancellor confirmed Labour’s plans to abolish “non-dom” tax status.

Overall, after weeks of speculation, the tax rises announced in the budget were not to the extent that many had feared. Individuals with pensions will be relieved to see no reduction in their maximum tax free cash entitlement and no change to the tax relief they can receive on pension contributions. Investors may also feel increases in capital gains tax rates could have been worse. Instead, businesses were left to fund the majority of the tax rises through their National Insurance contributions.

However, these changes to inheritance tax, pensions and capital gains tax rules will mean financial plans will need to be revisited. To discuss the implications of the budget for your personal financial situation, please contact your TPO Independent Financial Adviser.

Arrange your free initial consultation 

The Financial Conduct Authority (FCA) does not regulate estate planning or tax advice.

This article is intended as information only and does not constitute financial advice.  

The opinions shared in this article are solely those of the individual and they do not necessarily reflect those of The Private Office.

The information contained in this article is based on our understanding of legislation, whether proposed or in force, and market practice at the time of writing. Levels, bases and reliefs from taxation may be subject to change.

In today’s complex financial landscape, the issue of ‘ghost’ pensions - pension plans that exist on paper but are not actively funded nor ‘managed’ - has garnered increasing attention. As globalisation and the job universe evolves, so too does job mobility. As a result, many individuals find themselves grappling with lost or forgotten pension benefits. With this backdrop, it is easy to see how ghost pensions begin to emerge over time. This article delves into why the issue of ghost pensions is growing, the importance of finding lost pensions, and what steps to take once they are found.

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Why the issue of ‘Ghost Pensions’ is growing

Recent estimations by the Centre for Economics and Business Research revealed that 22% of UK workers believe they have lost a pension pot, with total misplaced retirement savings likely to exceed £50 billion. Between 2012 and 2017, the Government introduced auto-enrolment in stages, which involved a minimum commitment of 8% of a worker’s qualifying earnings being added to a workplace pension scheme (subject to conditions). Consequently, we have seen a significant uplift in the number of people putting money aside for their future. However, prior to auto-enrolment, only around half of UK employees had a workplace pension. 

Increased job mobility:

With auto-enrolment in mind, as individuals change jobs more frequently than in previous generations, they often leave behind pension plans that can become difficult to track. This is particularly true for younger workers who may work for multiple employers throughout their careers. Each transition increases the risk of losing track of benefits and in turn, this could eventually lead to a lower pot to fund your retirement if forgotten about.

Poor record-keeping: 

Many companies, particularly smaller ones or those facing financial difficulties, may not maintain accurate records of their pension plans. Over time, this neglect can lead to individuals losing track of their benefits, particularly if they do not receive regular statements or updates.

Aging population: 

As the baby boomer generation retires, the number of individuals searching for lost pensions is increasing. Many retirees are discovering that their pensions, which they believed would be a stable source of income, are actually ghost pensions due to lack of funding or proper management.
These three factors heighten the importance of ensuring you have a clear understanding of all the retirement benefits you have accumulated over your life, so that you know what is available to you in your years after work.

The importance of finding lost pensions

We are all busy people and as the weight of day-to-day life takes hold, people often tend to put bureaucratic, paperwork-heavy tasks to the bottom of the proverbial pile. However, your future self will one day thank you for taking the time to get ahead of your pension management as early as possible. 

Financial security: 

Pensions represent a significant part of an individual’s retirement income. Finding a lost pension can make a substantial difference in financial security during retirement. Many retirees rely on these funds to maintain their standard of living, and any lost benefits could dampen your retirement expectations.

Legal rights: 

Individuals have legal rights to their pension benefits, and understanding these rights is vital. Failing to locate and claim a pension can result in forfeiture of funds that the employee has earned over the years. Knowing your rights ensure you take necessary actions to reclaim your benefits.

Emotional well-being:

 The uncertainty surrounding lost pensions can lead to anxiety and stress, particularly as you approach retirement age. Finding and securing these funds can provide peace of mind, allowing retirees to focus on enjoying retirement rather than worrying about financial instability.

How to find a Ghost Pension

Finding a ghost pension can be a challenging task, but several strategies can help streamline the process:

1.  Start by collecting as much information as possible about your previous employment. 
   This includes:

• Names of past employers
• Dates of employment
• Job titles and departments
• Any pension scheme details you might remember

          2.  Check with Former Employers

Contact the HR department of your previous employers. They should be able to provide information about any pension schemes you were enrolled in. If the company has merged or gone out of business, try to find out who took over the pension obligations.

          3.  Use the Pension Tracing Service

The UK government offers a Pension Tracing Service, which is a free service to help you find lost pensions. Here’s how to use it:

• Visit the Pension Tracing Service website.
• Fill out a form with the details of your former employers.
• The service will help connect you with the pension scheme administrators.

What to do once you find your Pension

Once a ghost pension has been located, the next steps are crucial to ensure that benefits are secured:

Gather documentation: 

Collect all relevant documentation, including any statements or correspondence related to the pension. This may include records from previous employers, plan documents, and identification information. You can then provide the pension provider with the details to obtain your plan information.

Review your options:

Once you have clarity on your benefits, review your options. Depending on the plan, you will have a variety of income options available to you. These typically vary from each plan, and older pensions can have much more limited options available to you. Consider what features are right for you and whether this is offered in your existing arrangements. 

Stay informed: 

After reclaiming your pension, keep abreast of any changes to the plan or funding status. Regularly update your contact information with the pension plan administrator to ensure you receive timely communications.

Consider financial advice: 

Depending on the amount and nature of your pension, it may be beneficial to consult with a financial adviser. We at TPO provide holistic advice on pension and retirement planning to remove the anxiety you may have around your future. 

How we can help

Navigating the complexities of pensions is essential for securing a stable financial future in retirement. With the potential for lost or forgotten pension benefits increasing, it’s crucial to take proactive steps to locate and reclaim these funds. Utilising resources like the Pension Tracing Service, consulting with former employers, and exploring online databases can significantly help.

At The Private Office, we understand the challenges individuals face when planning for retirement, with our team of experienced financial advisors dedicated to helping clients navigate these complexities. If you’re concerned about your financial future, why not get in touch. We’re offering all those with £100,000 or more pensions, savings or investments a free cash flow forecast worth £500, to visualise if you’re on track for the retirement you want.

Arrange a free initial consultation

This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

The Financial Conduct Authority (FCA) does not regulate cash flow planning.

The clock ticks down with only six months remaining to plug National Insurance (NI) gaps. The government is encouraging people to act now and check their National Insurance record as there is no guarantee of a further extension to the deadline.  

As discussed in our previous article on National Insurance contributions (NICs), the government extended the deadline for NI contributions from the original 31 July 2023 to 5 April 2025 to allow eligible individuals to retrospectively fill gaps in their National Insurance record for the period covering April 2006 to April 2016. This extension was intended to give people more time to fill gaps in their National Insurance record that would otherwise prevent them from accessing the full State Pension.  

Plugging the gaps online

Earlier this year, the government launched a tool enabling people to pay to fill in gaps online. So far, more than 10,000 payments totalling £12.5m have been processed, according to figures from HM Revenue and Customs (HMRC). However, many still have gaps in their National Insurance record and are at risk of losing out on their full State Pension.  

• Key figures from the new online service shows the majority of customers (51%) topped up one year of their NI record
• the average online payment is £1,193
• the largest weekly State Pension increase is £107.44

After the 5 April 2025 deadline, people will only be able to make voluntary contributions for the previous 6 tax years, in line with normal time limits.

About National Insurance Contributions

National Insurance is an umbrella term for universal health care, unemployment benefits and the public pension programme.

National Insurance contributions are a form of tax that employees and employers pay to the government through payroll deductions. NICs are paid automatically through the PAYE (Pay As You Earn) system, which deducts an amount based on a percentage of your income, and this generally continues until you reach retirement age. Employees are able to make additional voluntary payments to increase the pension amount that they will be entitled to receive.  

NICs are collected in order to fund various state benefits, such as the NHS and state pensions.  

There are many reasons why you might have gaps in your NICs. If you were unemployed, in education, took a career break to raise a family or even if you were not earning enough, you may have periods where no NIC payments were made. You need to have been paying NIC for at least 10 qualifying years in order to receive any kind of State Pension, and you need to have been paying for a full 35 years to receive the maximum amount possible.

If you’re thinking about your retirement options and would like to speak to someone to map out your financial future, why not get in touch. We’re offering anyone with £100,000 or more in pensions, savings or investments a free review worth £500.  

Arrange your free initial consultation

This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.