Updated: April 08, 2024
Pensions for Freelancers
Looking for the best retirement scheme if you're a freelancer? Take a look at our guide for all the information you'll need
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One of the key differences between freelancers and those who are employed are that freelancers aren’t necessarily entitled to a workplace pension. Many employees choose to sign up to their company’s pension scheme and forget about it, safe in the knowledge that money is automatically being put aside to contribute towards their future.
As a freelancer, however, you have to arrange your own pension and savings system to ensure you’re financially secure during your retirement.
In this article we’ll explain what options are available to help you make pension plans as a freelancer, covering the following:
The pensions experts we work with have whole-of-market access, meaning that they can find the best pension plan deals for your circumstances – some of which may not even be available to the public.
Call us on 0808 189 0463 or make an enquiry today to get started.
What pension schemes are there for freelancers?
There are a number of options when it comes to pensions for freelancers in the UK.
These are detailed below:
As a freelancer you’ll be entitled to a state pension, however, this alone is unlikely to be enough for you to live comfortably on. During retirement, it’s currently £168.60 per week (as long as you paid the required number of National Insurance contributions), which is why having an additional personal pension is important.
With a personal pension you can enjoy some benefits, and one of those is that you can claim tax relief on the contributions you make towards your pension as long as it’s under £40,000 per annum. If you’re living in England, this means that for every £100 you invest in your pension, the government will invest £25 into the fund as a tax break. The amount varies if you live in Scotland or if you pay a higher rate of tax.
The best way to understand what the effect will be for you is to speak to an independent pensions expert who has experience in advising freelancers. They can also advise on which type of personal pension you should take out as there are different options including stakeholder pensions or self-invested personal pensions.
Make an enquiry and we’ll match you with one of the experts we work with for a free, no-obligation chat about your options.
The National Employment Savings Trust (NEST) is a workplace pension scheme (one of several in the UK) that employees may be automatically enrolled into. However, if you’re self-employed you can still enroll for this type of pension provided that you’re a UK resident who pays national insurance contributions, as well as other criteria. You can pay in as often as you like with a minimum of £10 until your chosen retirement date.
It’s also worth noting that if you have previously been employed and received any form of pension you’ll still be entitled to receive that, which will boost your overall pensions pot.
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What are the best pensions for freelancers?
This is a major decision that’s best discussed with a financial advisor who will advise you according to your particular circumstances.
For example, while it’s common to opt for a personal pension, some people opt for a mixture of this and an ISA savings account but this won’t be the right decision for everyone.
To get an expert opinion, make an enquiry and we’ll get back to you shortly.
When should a freelancer start saving for retirement?
It’s never too early to start a freelancer’s pension. The longer the period over which you pay contributions for, the more pension you’ll accrue and the more comfortable you’ll be during retirement.
It’s estimated that if you start your pension in your 30s by the time you get to retirement age, you may end up doubling your pension pot.
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Can I get a freelance contractor pension?
As a contractor you may be offered the choice of enrolling on the company’s pension scheme for the duration of your contract. You can choose whether to opt in or out.
For many people, having a number of pensions with different providers as part of their overall pension pot can give them more security, so it’s worth considering the pros and cons for your situation before you decide.
Remember, you’ll have to forgo some of your usual salary but that money will be invested as your pension instead and this can have beneficial effects in the future.
Speak to an expert about pensions for freelancers
Pensions can be a minefield and what works for your friends or partner may not be the same for you. That’s why it’s best to speak to a pensions expert about freelancer pensions. They will explain the options for your personal circumstances related to factors like your age, salary etc.
This is something that we can help you with. Give us a call on 0808 189 0463 or make an enquiry we’ll match you with a pensions expert who can talk you through your options and find the best deals for you. We don’t charge a fee and there’s absolutely no obligation to take the advice given.
Ask a quick question
We can help! We know everyone's circumstances are different, that's why we work with brokers who are experts in pensions. Ask us a question and we'll get the best expert to help.
Tony Stevens
Finance Expert
About the author
Tony has worked in a vastly diverse array of areas in the pensions industry for over 20 years. Tony regularly writes for trade press, usually on topical and pensions pieces as well as acting as a judge at prestigious national events.
Tony is also a highly qualified Independent Financial Adviser in his own right. His mantra has always been “Hope for the best, but plan for the worst”, and believes that the biggest impact that an adviser can have on a client’s life journey is to take them on a journey from generally having little or no real idea of what their retirement will look like, to giving them the understanding of what their retirement looks like now, then helping them navigate a path to what they want their retirement to be.
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