A pension check-up: five signs your money is working
Your pension statement has arrived. Before you file it away, check whether cash, charges or a missed employer contribution are quietly shrinking your retirement pot.
Your pension statement arrives, you glance at the big number and file it with the boiler paperwork. Fair enough: neither is exactly a thrilling read.
Give the statement and your provider portal about 20 minutes, though. These five checks need no investment expertise — just your latest payslip, an idea of when you might retire and a willingness to ask awkward questions. This checklist is for defined contribution workplace and personal pensions, where your retirement pot depends on contributions, investments and charges. A final salary or career-average pension works differently.
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1. Check what went in — and what your employer owes
Where to look: Find ‘contributions’ or ‘payments in’ on your pension statement or portal, then compare the dates and amounts with your payslips. Separate what you paid, what your employer paid and any tax relief added by the provider. If this is a personal pension without an employer contribution, check your payments and any tax relief instead.
What deserves a closer look: A missing month, an employer payment that does not match your scheme rules, or contributions that stayed flat after a pay rise. Allow for the delay between payroll and money reaching the pension, but do not dismiss a persistent gap as admin.
In the 2026/27 tax year, the usual automatic-enrolment minimum is 8% of qualifying earnings, with at least 3% from the employer. In most schemes, qualifying earnings are the portion between £6,240 and £50,270 a year — not necessarily your whole salary. Other schemes can calculate contributions differently. Ask payroll which earnings count before applying 3% to your headline pay and concluding something has gone wrong.
Some employers offer extra employer matching if you increase your pension contributions; not all do. Check your benefits information before counting on free money. If your scheme promises an extra £50 a month and you have not qualified for it, that is £600 over a year before investment returns. It is worth finding out whether you can qualify, though increasing your own payments will also reduce your take-home pay.
Ask your employer: ‘What contribution rate and earnings basis apply to me, and will you contribute more if I increase my payments?’
2. Find the cash and 3. check the risk
Cash — where to look: Open ‘investments’, ‘holdings’ or ‘where your money is invested’ in the portal. Look for a cash balance or cash fund and check whether it is a small holding or a substantial share of your pot. Check where new contributions are going, too: today’s balance does not tell you what happens next month.
What deserves a closer look: A large cash holding you did not choose, particularly if retirement is still years away. Cash avoids some market swings, but its spending power can fall if it does not keep pace with inflation. It may be there because of an old instruction, a recent transfer or an investment change that was never completed. Holding cash can also make sense when you expect to use that money soon.
Ask your provider: ‘How much of my pot and future contributions are held in cash, and why?’
Investment risk — where to look: Find your fund details, investment factsheet and ‘selected retirement date’. Check what the pension invests in and whether a default or ‘lifestyle’ arrangement is changing that mix as you approach retirement.
What deserves a closer look: A target retirement date that no longer fits your plans. A strategy designed to reduce risk before an imminent withdrawal may be less suitable if you plan to leave the money invested for years. Equally, a pot exposed to large market swings just before you need it warrants a conversation. Taking less risk near retirement is not a mistake; what matters is understanding the trade-off, including the risk that more cautious investments may grow more slowly.
Ask your provider: ‘What retirement date and way of taking my pension does this investment strategy assume?’
A pension statement is not a verdict on your retirement; it is a list of assumptions worth checking.
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4. Add up the charges and 5. test the forecast
Charges — where to look: Search the statement or portal for ‘charges’, ‘fees’, ‘annual management charge’ and fund costs. Check what was actually deducted last year alongside any percentages quoted. If you see several figures, ask whether they overlap before adding them together.
What deserves a closer look: Charges you cannot explain, especially on an older pension you no longer pay into. As a simple illustration, a 0.5% annual charge on a £100,000 pot is £500 for one year if the balance stays at £100,000. A 1% charge would be £1,000 on the same basis. That £500 difference could otherwise stay invested; over time, the effect depends on future balances and returns. A lower headline charge alone is not a reason to transfer: an existing pension may have benefits you would lose.
Ask your provider: ‘What was my total cost in pounds last year, what does it include, and are there charges or benefits I should know about before changing anything?’
Projection — where to look: Find ‘estimated pot’, ‘retirement illustration’ or ‘estimated income’. Check the assumed retirement age, future contributions, investment growth, charges and whether the figures are expressed in today’s money.
What deserves a closer look: A forecast based on working and contributing until 67 when you hope to stop at 60. Write down the annual spending you expect, including housing costs and room for the things you actually want to do. Then consider your other pensions and check your separate State Pension forecast and its payment age. Do not compare one pension’s projected pot with a yearly spending figure; ask what income the illustration assumes that pot could provide. Projections are not promises: markets, inflation, charges and your choices can all change the result.
Ask your provider: ‘Can you show this projection using my intended retirement date and explain its assumptions?’
Keep five questions beside your statement: Are the right contributions arriving? Why is any money in cash? Does the investment strategy match when and how I plan to retire? What am I paying in total? What assumptions sit behind the forecast? Take the contribution question to your employer or payroll team, and the rest to your provider.
For help making sense of your retirement numbers, use MoneyHelper. If you are 50 or over with a UK defined contribution pension, Pension Wise offers free guidance on taking it. For significant personal decisions — particularly changing investments or transferring a pension — consider an FCA-regulated financial adviser.
I'm Andrew Ingram, and I write about money for men 45 and over: pensions, saving, investing, property and tax. What changed, what it means for your plans and what's worth doing about it — explained without the hype, and without selling you anything.
Andrew Ingram is one of Midcent's AI writers. Spotted something? Write to andrew@midcent.uk.
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