People are retiring later in life, according to the Office for National Statistics (ONS), yet many still find themselves facing a significant shortfall in the amount of pension savings they need.


The age where more than half of people were retired increased from 64 in 2011 to 66 in 2021, the latest ONS ‘Milestones’ report released earlier this month reveals. The report looks at the key events that mark out adult life and the changing ages at which people tend to experience them.

However, even though the average retirement age is getting later, which should mean in theory that people have longer to save for retirement, most still face a significant shortfall in the amount of pension savings they end up with. Separate research from Standard Life, part of Phoenix Group, found that retirees hoped to have a pension pot of £250k when they finish working – but typically end up with £131k in retirement savings on average, potentially reducing their monthly income in retirement by £480.

Here, we look at some of the ways you might be able to boost your pension savings so that you have a better chance of enjoying a comfortable retirement when you finish working.

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Could you increase your contributions?

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Under auto-enrolment rules, combined contributions by employees and employers stand at 8% of earnings between £6,240 and £50,270 a year and have been frozen at this level since 2020/21. However, this doesn’t mean you can’t increase your contributions if you can afford to.

Alice Guy, head of pensions and savings at interactive investor, said: “When it comes to your pension, increasing your contributions is especially valuable as any extra payments are super charged by additional pension tax relief. This means it only costs £80 to increase your pension contributions by £100 each month, as you’ll receive a £20 tax boost.

“For higher rate taxpayers it’s an even better deal and it only costs £60 to pay £100 into your pension, due to additional tax relief. Upping your pension contributions over time can give your wealth a huge boost and make it easier to achieve your retirement goals.”

Remember to claim tax relief

Tax relief, as mentioned, can provide a significant boost to your retirement savings, but if you’re a higher or additional rate taxpayer you must remember to claim it back. You can do this via your tax return.

Helen Morrissey head of retirement analysis at Hargreaves Lansdown explained: said: “In most cases, basic rate tax relief will usually be added to your pension contribution. But if you’re a higher or additional rate taxpayer you may need to claim the extra 20% or 25% tax relief through self-assessment.”

Make the most of carry forward rules

You can currently save up to £60,000 per year into your pension, known as your annual allowance. If you haven’t been able to use this previously, and perhaps now have a lump sum to invest, such as an inheritance or bonus, you can use previous years’ allowances if you want to.

Jason Hollands, managing director at investment platform Bestinvest, part of Evelyn Partners, said: “If you don’t make full use of your current year pension allowance, it is not lost forever. Under ‘carry forward’ rules, you have the ability to utilise unused pension allowances from the previous three years once you have fully utilised a current year allowance, providing you belonged to a registered pension scheme in those years.”

Could you delay taking your pension?

If you’re not planning a ‘hard stop’ retirement, and so perhaps are thinking about winding down the amount you work gradually, think carefully about whether you might be able to delay when you start taking an income from your pension.


This will not only give you more time to contribute to your retirement savings, but it also means there will be more time for your pension investments to potentially grow in value.

Cashback offers from Hargreaves Lansdown for 2024 - savings, investments and pensions