Home Pensions & retirement Saving in your 50s

Saving for retirement in your 50s

Deciding when to take your benefits and retire is a balancing act between what you hope for and the reality of a retirement that may last for two or three decades.

A lot of this uncertainty can be taken away by making sure you have a retirement plan.

There are lots of different places where you might have retirement savings, such as your state pension, any company or personal pensions, and other assets such as property and ISAs. Some automatically give you an income, while others require you to make decisions. Either way, you need to know how much you have so you can plan ahead effectively – find out more about creating a retirement plan.

Planning your retirement

The first step is to figure out what you might need in retirement, and what your current pensions might provide.

Estimate what you’ll need

Our retirement calculator will help you to compare your income and expenditure in retirement.

Retirement calculator

Estimate what you’ll get currently

Get an estimate of the income you could receive from your pension with an annuity, drawdown or a combination of both.

Pension calculator

What you can do now

Bring your pensions together
Maximise the tax benefits of pensions
Consider switching other assets
Review your investment choices
Use your carry forward allowance

The tax benefits of a pension

  • Investment growth of your savings in your pension is not taxed
  • In a personal pension such as the Fidelity SIPP, we can claim 20% tax relief from the Government and add it to the money you save
  • You can save up to £40,000* a year in your pension and receive tax relief so long as it’s not more than you earned
  • You can claim money off your tax bill if you pay higher-rate or additional-rate tax
  • From the age of 55 you can normally take a tax-free lump sum worth up to 25% of your pension

What next?

If you want to open a new pension or transfer an existing pension to Fidelity, then take a look at our Self-Invested Personal Pension (SIPP). It’s low cost and easy to manage online.

Open a pension

  • A tax-efficient way to invest for your retirement (subject to limits)*
  • Benefit from 20% government tax relief, added to your SIPP account
  • If you pay Income Tax at higher than the basic rate, you may be able to claim even more tax relief through your tax return
  • Employers can also contribute. Payments from a limited company are considered employer contributions

Transfer a pension

  • Transfer your pension to us and we’ll pay any exit fee (up to £500 per person, T&Cs apply**) that your current provider charges you
  • Applying online takes a few minutes, and depending on your current pension provider your transfer could be complete in ten business days
  • We’ll contact your providers and arrange for your investments (or cash) to be brought into your Fidelity account
  • You can track your transfer online where you’ll see the status of each transfer request

*Tax relief is only available on the lower of the annual allowance (currently £40,000) or 100% of your earnings in a given tax year. If you exceed your annual allowance you may have a tax charge to pay unless you have unused allowance you can carry forward. If you have earnings of £110,000 or more, the amount you can pay in and receive tax relief on could be ' tapered' down to £10,000. Alternatively, if you’ve already taken taxable income from your pension pot under pension freedoms, your annual allowance may be £4,000 (known as the money purchase annual allowance) and you will not be able to use carry forward to contribute to a SIPP.

For more information on tax relief and all the allowances please visit our pension allowances page.

Remember that the value of investments can fall as well as rise, so you may get back less than you invest. It’s important to understand that pension transfers are a complex area and may not be suitable for everyone. Before going ahead with a pension transfer, we strongly recommend that you undertake a full comparison of the charges, features, and services offered.

If you are in any doubt whether or not a pension transfer is suitable for your circumstances we strongly suggest that you seek advice from an authorised financial adviser.

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Carry forward

Find out more about taking advantage of unused annual allowance in our guide to carry forward

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Thinking of transferring?

To find out what you should consider first, please read our Fidelity SIPP transfer guide.

Get your pensions and investments working harder

Find out how bringing your pensions and investments together could benefit you.

Thinking about taking cash from your pension?

Once you reach the age of 55, you’re usually free to take money out of your pensions, even if you don’t retire. If you have no immediate plans to use the cash, it may be better to leave it invested in your pensions.

Leaving your money invested means:

  • Your money stays in a tax-privileged environment
  • You don’t affect the inheritance you leave to your loved ones
  • You may get a better return

Your pension is there to give you an income for the rest of your life, so if you take too much too soon, you may not have enough left for what could be two or three decades of retirement.

Explore tax-free cash
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This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to an authorised financial adviser.

Remember, the value of investments can go down as well as up, so you may get back less than you invest. This information is not a personal recommendation for any particular product, service or course of action. Pension and retirement planning can be complex, so if you are unsure about the suitability of a pension investment, retirement service or any action you need to take, please contact Fidelity’s retirement service on 0800 368 6882, Monday to Friday, 9am - 5pm, or refer to your financial adviser. Eligibility to invest into a SIPP depends on personal circumstances and all tax rules may change in future. Pension money cannot normally be withdrawn until age 55.