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Why save with a
workplace pension

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Workplace pensions are an effective way to save, helping to build financial security for your future.

A workplace pension is a scheme set up by your employer on your behalf to help you save for retirement. Many UK workers have been automatically enrolled into workplace pension schemes like Nest to help them prepare for the future simply and smartly.

If you’ve been automatically enrolled into a workplace pension it’s because your employer is required to do this by law. This is to help you save for your future as most people won’t enjoy a comfortable retirement through the State Pension alone.

Workplace pensions are different to most other types of pension. Both you and your employer put money into your pot, so you build up more savings over time.

The minimum contribution set by the government that you and your employer pay into your workplace pension is 8%.

There are lots of benefits to saving with a workplace pension like Nest.

  • You could get extra money on top of your salary in the form of employer contributions. So, when you start saving into a workplace pension it’s a bit like getting an immediate pay rise from your employer that helps to fund your future.

  • You receive tax relief every time you pay contributions, if you’re eligible. This extra money tops up your pot and is the government’s way of encouraging you to save for life after you stop working.

  • You decide how your Nest pension is managed. If you want to choose how you invest, you can. If you’d prefer just to set the destination and leave getting there to us, you can do that too. It’s your money. You call the shots.

  • You can increase your income beyond the State Pension, which currently pays a maximum of £179.60 a week - that’s around £9,300 a year. While this provides a good foundation, it won’t be enough on its own for many of us to live on.

  • Your money can grow more than it would in a cash ISA, for example, as your pension pot is spread across a range of investments.

  • As Nest was set up and is regulated by the government you can be confident that we’ll manage your pension responsibly.

  • By contributing even a small amount regularly, over time your money will grow and could make a big difference to your retirement.

A workplace pension can fit perfectly around your other financial commitments and your savings set-up. It doesn’t need to replace what you’re currently doing but can work seamlessly alongside. 

If it feels like you can’t afford to pay into a workplace pension or you’re concerned about balancing it with a mortgage or other debts, then don’t worry. You don’t need to pay in huge amounts of money unless you want to, or decide how much to save right now. But it’s worth remembering that no matter the amount, saving regularly while you’re working can make a big difference when you retire. You do have the option to pause your contributions if you need to, but you should understand what this means for your pension first.

Some people decide to overlook workplace pensions, choosing to prepare for later life through property or other investments instead. These strategies work for some, but you could miss out on the extra contributions from your employer and tax relief from the government. They can also be risky, complicated and time consuming. Workplace pensions are an easy way to build up a comfortable pension pot for your retirement.

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Managing a pension and a mortgage

Taking out a mortgage is a huge commitment but it’s one that can balance well with pension contributions.

Balancing pensions and mortgages

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Fitting pensions around other investments

Paying into a workplace pension is a great way to save for your future and can fit perfectly around your current investments.

Pensions and other investments

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Pension and debt payments

Even if you’re managing debt you can still benefit from making pension contributions too.

Balancing pensions and debt

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Playing the long game

It’s simple – the longer your money is in a workplace pension, the more time it has to grow. Find out why you should start saving earlier rather than later.