Got a new pension plan? Here's what to think about

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There are different ways to land a new pension plan. Some people shop around and set one up themselves. Some people get one through their employer when they start a new job, thanks to something called ‘auto-enrolment’. Either way, there are some important steps for you to take when you get a new plan. And using this checklist could help you.

1. Think about going online

When you get a new pension plan, it’s worth checking whether your provider has an app or seeing if you can set up an online account with them. There are usually lots of things you can do digitally, like reviewing how much money is in your plan and changing your personal information whenever you want. You might find it easier to manage your plan this way, and it could save you time. 

If you’re a Standard Life customer and you’d like to find out more about our online services, you can take a look at our website. But don’t forget you can also visit our support page if you’re looking for other ways to get in touch or take action. 

2. Update your personal information

Make sure the information associated with your new plan is up to date. 

Check your provider has the right home address and email address for you so they can contact you about your plan. 

You may also want to make sure that you choose beneficiaries (the people you want your pension savings to go to when you die). Your provider will keep a record of your wishes and take them into account when paying death benefits. You might be able to name your beneficiaries online, or you may need to get a beneficiary nomination form from your provider.

And do check that the retirement date on your plan reflects when you think you’ll want to retire. You can usually update this if you want. But first, check with your provider to see how changing your retirement date could affect your plan (for example, it could impact things like where your money’s invested). And ask whether you’d lose any benefits that come with your plan.

3. Review your payments in and your investments

It’s important to look at what you’re paying into your plan and make sure it’s right for you.

Did you get a new plan through your employer? They usually need to pay in a minimum of 3% of your ‘qualifying earnings’ (anything you earn between £6,240 and £50,270). You normally need to pay in a minimum of 5%, and you’ll typically start paying into your new plan automatically. 

You can normally change what you’re putting in if you want to, but you may need to get in touch with your employer first.

If you opened your new plan yourself, you’ll need to decide how much to put in. Make sure you’re happy with that figure.

Keep in mind that you can get tax benefits on payments you make into a pension plan. Remember, there’s something called the ‘annual allowance’, which is the total amount that can be paid in across all your plans in a given tax year before you face a tax charge. You can find out more about this in our article. The current tax year is coming to an end on 5 April. 

Once you’ve started saving into a new plan, it’s worth regularly checking in on its value to see how your money’s doing.

Speaking of – the money that’s paid into a pension plan is invested. Your investments may have already been chosen for you, but it’s worth reviewing them and checking that you’re comfortable with them. Remember, the value of your investments can go down as well as up and you could get back less than was paid in. 

Making changes to your plan and its investments is a big decision and could impact how much you’ll have in the future. If you’re feeling unsure about which investments are right for you, it could be worth speaking to a financial adviser. If you don’t have one, you can find one at Unbiased. You can check if an adviser has been authorised by the Financial Conduct Authority (FCA) on FCA.org.uk.

4. Track down your old plans

You might have more than one pension plan, especially if you’ve had more than one job. 

Whenever you get a new plan, cast your mind back to who your previous providers were, and make sure you know where your old plans are. If you’re not sure, don’t panic – the government’s Pension Tracing Service can help you track them down.

Some people may find it easier to keep track of their pension savings if they bring multiple plans together into one plan. This is often known as a ‘pension transfer’. Remember, transferring will not be right for everyone, and you could lose valuable benefits and guarantees.

5. Try out a financial planning tool

Finally, once your new plan has been set up, why not use a free planning tool to help you plan for the future? There are plenty you can find online. For example, you can use our pension calculator to give you an idea of how much you might have across your plans by the time you retire. 

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The information here is based on our understanding in January 2024 and shouldn’t be taken as financial advice.

Pension plans are investments. Their value can go down as well as up and could be worth less than was paid in.

Your own personal circumstances, including where you live in the UK, will have an impact on the tax you pay. Laws and tax rules may change in the future.

Standard Life accepts no responsibility for information in external websites. These are provided for general information.