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Planning ahead

Pensions for the under 50s

When you’re under 50, retirement may still seem a long way off and there may be other things competing for any extra money you earn – holidays, children heading off to university or supporting elderly relatives – but putting money away into a pension is just as important.

Did you know?

44% of retirees depend on the State Pension as their main source of income.*


Your questions answered

  • Pensions are a tax efficient way of saving for your retirement. You don’t pay income tax on the money you pay into your pension or on the amount it grows. You can also take a quarter of your pension pot as a tax-free lump sum when the time comes to retire.

  • Pension money is invested and your investments can go down as well as up, meaning you could get back less than you invested. The idea is that this pattern of ups and downs balances out over time, which is why investing for your retirement is a long-term plan.

  • The most popular pension route is to invest in a pension. You can either set up a private pension yourself, or pay into a workplace pension scheme set up by an employer. If you pay into a workplace pension scheme, the amount you choose to contribute is often met by the same contribution (up to a set limit) by your employer – so your savings grow even more quickly. As a part of Lloyds Banking Group, Scottish Widows offers pensions and advice. See how they can further help you understand your options.

  • On average, a person will have 11 different jobs over the course of their working life . If you’re part of a pension scheme at each job, that means you could end up with pension pots all over the place. If you’re self-employed, you may have different pension pots depending on if you’ve worked for a company or pay into accounts privately. You can choose to combine your pension pots or keep them separate, but it’s worth considering the pros and cons of each option carefully. Keeping tabs on your different pensions is also important, with estimates that there is almost £20bn in ‘lost’ pensions outstanding*.

    * The Times - £20bn pension treasure hunt - October 2018

  • It’s never too late to start saving for retirement, so even if life has got in the way, any money you pay into your pension fund will make a difference.

    Our pension payment calculator shows you how different levels of payment can add up and our paying more calculator helps you see how increasing your payments could help you get more at retirement.

  • There’s no longer a statutory retirement age for most jobs, and many pension schemes give you some flexibility over when you can take your money once you reach 55.

  • Our pension options calculator can help you understand how these options would work for you if you were to be retiring now and, although the rules or options may change, they can give you an idea of whether you’re on track with your plans or whether it’s worth topping up your payments. Your pension provider or administrator should be able to give you an up-to-date statement of what your pension could be worth at the retirement age you originally selected. You can also find out what State Pension you may be entitled to.

  • Things may have changed by the time you’re ready to retire, but currently there are a number of options available to you when you decide that the time is right to take money out of your pension:

    • Turn it into a regular taxable income (annuity), so you can always be sure of what you’ll get.
    • Take lump sums (25% tax free) and taxable income from your pension pot as and when you need and leave the rest invested.
    • Take your whole pension pot as a cash sum of which 25% would be tax free but the remaining 75% is taxed along with any other income you may receive. Leave it where it is and continue saving.

What should I do today?

Scottish Widows have been helping people plan for retirement for over 200 years. As a part of our Group, they can help you to understand whether your plans are workable to give you the retirement you want and help you make the best decisions for you.

To find out more about pensions.

Visit the Scottish Widows website

If you’d like to combine your pensions we can help.

Visit our pension transfer pages

Tools and resources

Pensions Transfer - if you have more than one pension pot you could combine them into one plan to make them easier to manage

Pensions Transfer

Handy Tool - if you’re approaching retirement, review your pension options with our pensions provider Scottish Widows and see how you could benefit

Pensions Calculator

Wealth Management Service – if you feel that you’d benefit from some financial advice to plan your retirement, we can help.

Wealth Management

Looking for further help?

Visit the Money Advice Service website for more information. You might want to talk to a financial adviser. Find one near you.

The Government are offering free guidance on your options online, by phone or face to face from Pension Wise.

Important legal information

Lloyds Bank plc. Registered office: 25 Gresham Street, London EC2V 7HN. Registered in England and Wales No. 2065. Lloyds Bank plc is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 119278.

Eligible deposits with us are protected by the Financial Services Compensation Scheme (FSCS). We are covered by the Financial Ombudsman Service (FOS).

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