What Help Can the Self-Employed Get with Pensions?

What does retirement planning look like for the self employed?

There are around 4.8 million self-employed people in the UK, but only 31% of the self-employed are saving into a pension. A large advantage of being self-employed is being able to work for yourself and not having a boss. One of the disadvantages, however, is that you don’t get automatic pension payments from the company you work for.

The result is that when it comes to saving for a pension, the self employed are at a disadvantage.

What does self employed retirement look like?

As a self employed person, you are less likely to rely on one source to provide an income when you retire.

It will vary from person to person, but it’s unlikely you will have a large pension pot or a generous final salary pension like employees may have.  

Instead, retirement money may come from many different sources. This may be a trade sale, continuing income from a business, or maybe some part-time work. These can be used alongside any traditional pension pot and the State Pension to give you the retirement income you want. In short, there is likely to be a greater mix of things to use for retirement and help will be needed in putting these all together in a plan.

How to save for retirement

Again, saving for retirement will look different between the self-employed and an employee. Someone who is employed is now likely to make steady contributions (plus employer contributions) into a pot. Instead, as a self employed person, you will be likely to have more unpredictable income. This may translate into saving more money when income is high, and less, or even zero, when there are more pressing business or personal needs.

Given this, a key need is the ability to easily adjust or take a break from contributions when necessary. 

How can Guiide help?

Firstly, Guiide’s free calculator can combine everything you may be thinking about using in retirement into one plan, rather than just looking at the traditional sources alone.

This means everything can be considered together, allowing you to create a payment and income plan that works for you. This might include a projected business sale at retirement, other income, or part-time work during retirement. 

Secondly, once you make your plan, you can compare the lifetime charges between pension providers, so that you can look to see if it may be worthwhile putting any pension pots together with them. We have partnered with a number of low-cost pension providers to ensure that you can keep more of your own money rather than pay excessive amounts on fees and charges. Our partner providers also all have simple, ready-made portfolios so you don’t need to worry about managing your own investments in detail.

Penfold: the Specialist Self Employed Provider

One of our partner providers, Penfold, is specifically set up for self-employed and company directors. They offer features including flexible contributions, holidays and pulling multiple pensions into one place. They are a relatively new provider, but already have an excellent rating on Trustpilot based on over one hundred reviews.

Guiide has an exclusive agreement with Penfold. This means you get a discount on their (already low) fees if you sign up with them through your Guiide plan. This reduces the 0.75% per year current total charge to 0.35% a year on any funds over £100,000 in their Blackrock fund option.

If you are self employed, you can build a plan with us today that combines everything you want to put towards retirement.  It costs nothing at all to do! You can then compare how much you can save in pension charges, and consider the other benefits of using any of our partner providers, including Penfold!