Myth 5: I have a pension so I’m fine

Since the implementation of auto-enrolment, the vast majority of employees in the UK are saving into a workplace pension.

While the development of auto-enrolment has been seen as universally positive, the Pensions Policy Institute estimates that an appropriate pension contribution varies between 14%-27%^[1] of total salary, with many people needing to make additional contributions due to starting late or not paying in enough. This estimate is well below the 8% minimum contribution rates for auto-enrolment (made up of 5% minimum direct contributions and 3% minimum employer contributions).

While contributions in the region of 27% are an outlier, many people can boost their contributions from their current levels. Doing so earlier rather than later is a positive step, given that the value of contributions made in your 20s will be around four times greater than a decade’s worth of contributions made in your fifties.

Ensuring greater financial stability is also vital given it’s difficult to predict how much the state pension will be when you retire.

How much do I need to save for my retirement?

Retirement isn’t always a cliff-edge decision - it can be phased in gradually, with reduced hours or a career change. Planning for this shift is complex, and cash flow modelling (which your financial adviser can provide) is a powerful tool to help. It gives a holistic view of your finances, showing which assets to draw on, when, and how sustainable your plan is. It also considers tax and lifestyle choices, helping you make informed decisions at every stage.

How should I invest my pension?

This comes down to personal circumstances, as pension investments should reflect an individual’s age and how long the investments have to grow. For example, a younger person several decades away from retirement may want to put most of their pension in higher growth, higher risk assets, like equities. This is because the long investment time horizon of a younger investor allows for volatility to be smoothed out over time to produce better returns than a low-risk option.

Someone closer to retirement will typically hold more of their pension in lower risk assets, such as fixed income, to preserve the wealth they have accumulated. This does not have to be the case, and pension investment strategies can and should be tailored to the individual’s requirements and circumstances. When it comes to drawing income in retirement, our Tailored Income Service offers flexible, personalised solutions that adapt to each client’s goals and circumstances.

Here to help

At Quilter Cheviot, we can help you manage the investments in your pension and work with you (and your financial adviser, if you have one) to ensure you are invested in a way that suits your individual retirement needs.

Monitoring performance against retirement targets is a key planning opportunity, with advisers and investment managers working collaboratively to track your objectives, guiding on investment strategies, your current pension arrangements, future saving plans, and how to manage your pension in retirement.

For more information on our Tailored Income Service, simply fill in your details to arrange to speak to one of our investment managers.

^[1] PLSA Technical report rls adequacy modelling 2025