Are These Pension Errors Costing You Thousands?
Pension experts Lisa Picardo (PensionBee) and Claire Trott (St. James’s Place) reveal the top 5 pension mistakes that could leave you with less retirement income than you expect.
1. Losing Track of Old Pension Pots
❌ The Mistake: Forgetting about pensions from past jobs
💡 Why It’s Bad:
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4.8 million UK pensions are “lost” (PensionBee research)
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Multiple small pots = higher fees & harder to manage
✅ The Fix:
✔ Consolidate pensions into one pot
✔ Use the Pension Tracing Service (Gov.uk link)
2. Missing Out on Free Employer Contributions
❌ The Mistake: Not maximizing workplace pension matching
💡 Why It’s Bad:
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Employers often match extra contributions (free money!)
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Missing this is like turning down a pay rise
✅ The Fix:
✔ Check if your employer offers contribution matching
✔ Even 1% extra can make a big difference long-term
3. Starting Too Late (Or Contributing Too Little)
❌ The Mistake: Delaying pension savings for “later”
💡 Why It’s Bad:
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Compound growth works best over decades
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Waiting until your 40s or 50s means playing catch-up
✅ The Fix:
✔ Start as early as possible (even small amounts help)
✔ Use a pension calculator to see growth projections
4. Ignoring Tax Relief
❌ The Mistake: Not claiming full pension tax relief
💡 Why It’s Bad:
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Basic-rate taxpayers get 20% top-up from HMRC
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Higher earners can claim 40% or 45%
✅ The Fix:
✔ Check if you’re claiming all relief (especially if self-employed)
✔ Consider salary sacrifice for extra tax savings
5. Not Reviewing Investments
❌ The Mistake: Keeping pensions in default funds forever
💡 Why It’s Bad:
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Default funds may be too cautious for long-term growth
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Your risk tolerance changes over time
✅ The Fix:
✔ Review investments every 2-3 years
✔ Consider diversified funds or ethical options
How to Fix These Mistakes Today
1️⃣ Find lost pensions (use the Pension Tracing Service)
2️⃣ Increase contributions (aim for 12-15% of salary including employer payments)
3️⃣ Consolidate old pots (lower fees, easier management)
4️⃣ Check tax relief (don’t miss free government money)
5️⃣ Review investments (optimize for growth)
💬 Lisa Picardo (PensionBee) says:
“Small steps now can lead to thousands more in retirement. Don’t wait—take control today.”
