🟩 Why Do We Have Pensions?

Pensions exist to give people financial security when they stop earning a salary. With people living longer than ever, pensions play a vital role in helping you fund 20, 30, or even 40 years of life after work.

🟩 How Do Pensions Work?

• You (and often your employer) contribute money regularly into your pension pot.

• The government gives you tax relief, boosting your savings.

• Your money is invested with the aim of growing over time.

• At retirement, you use your pension to provide an income.

🟩 The Key Benefits of a Pension

• Tax relief: Contributions reduce your taxable income.

• Employer contributions: Many employers add money into your pension on top of your own payments.

• Investment growth: Your pension is invested, giving potential for long-term growth.

• Compound interest: Growth builds on itself over time, especially if you start early.

🟩 Types of Pension

• State Pension — provided by the government based on your National Insurance contributions.

• Workplace Pension — arranged through your employer.

• Personal Pension — arranged privately, especially if you're self-employed or want to make extra contributions.

🟩 When Can You Access Your Pension?

Most private pensions can be accessed from age 55 (increasing to 57 from 2028). The State Pension starts later, currently at age 66 for most people.

🟩 Why Starting Early Makes a Big Difference

The earlier you start contributing, the more time your money has to grow — even small contributions can build into a significant retirement fund through compounding over many years.