There are several ways to enhance your pension pot and increase the amount of money you’ll receive in retirement.
One option is to make voluntary National Insurance contributions. If you have gaps in your National Insurance record, for example due to periods of unemployment or caring for children, then making voluntary contributions could help you qualify for a higher state benefits. You can check your NI record online to see if you have any gaps and how much it would cost to fill them.
It’s worth noting that there are time limits for making voluntary NI contributions. In general, you’ll have six years from the end of the tax year in which the missed contribution should have been paid to make a voluntary payment. After this time, it may not be possible to catch up on any missed contributions.
Another way to boost your retirement income is through a workplace or personal / private pension. Many employers offer a workplace pension scheme as part of their benefits package, which can be a great way to save for retirement while also benefiting from employer contributions. Alternatively, you may choose to set up a personal pension plan with a financial provider.
Both workplace and personal pensions work by investing your money in stocks, shares and other assets with the aim of growing your savings over time. The amount you’ll receive in retirement will depend on factors such as how much you contribute, the performance of the investments and any fees charged by the provider.
It’s important to remember that pensions are a long-term investment and that there are risks involved. However, they can also be a tax-efficient way to save for retirement and provide an income in later life.
If you’re unsure about how best to enhance your pension pot or want more information about your options, it’s always recommended that you seek professional financial advice before making any decisions.