FAQs for Workplace pensions

For many people, joining a workplace pension is a good way of building up a pot of money to provide an income in retirement. You'll get tax relief on your contributions and your employer may pay in too, giving a significant boost to your savings.

However there may be times when paying into a pension may not be the best option. For instance if you have outstanding debts which need to be paid off or there are other financial priorities. Saving into a pension plan is not for everyone. Joining a plan may not be suitable for you, particularly if these savings could affect your entitlement to any means tested state benefits.

Your employer may also stop paying in to your pension if you stop, check with your employer.

Please note, you may have to pay tax when you take money out of your pension.

Since 2012, employers have been required to automatically enrol their eligible employees into a workplace pension scheme. If and when you’re notified that you’ve been automatically enrolled, you can choose to opt out, but you may be missing out on benefits, such as contributions from your employer and tax relief.

Your employer is required to enrol you again every three years if you are still eligible and not currently a member of their pension scheme. You will have the right to opt out again.

Find out more about automatic enrolmentPDF file: Being prepared PDF size: 271KB  

If you are eligible, you'll be automatically enrolled into the pension scheme. Yours and your employer's contributions will be put into the default investment option. You’ll be able to move your money into the investment options of your choice once we have received your first contribution.

Once you've been enrolled you'll receive a notification explaining the pension scheme and your options to stay in or opt out.

If you’re automatically enrolled you can visit WorkSave Choice (subject to your scheme using Choice) to review your scheme and personal details or to opt out if you do not want to stay enrolled in your workplace pension scheme.

Even if you are not eligible to be automatically enrolled, you may still be able to join your workplace pension scheme. Talk to your employer about how you can join.

You can stop contributions to your pension at any time without penalty. We'll still take charges from your fund even if you stop contributions.

You can restart contributions at any time, again without penalty. If your employer is deducting the contribution from your salary they may restrict when you can restart. Your employer will also have to auto-enrol you into their scheme again every three years if you are still eligible.

Think about why you've decided to stop contributions, as it will have an effect on your retirement income. It's worth bearing in mind that saving regularly can be easy to stop but difficult to start up again. After a month or so you may not notice the contribution going from your salary, but if you decide to stop, starting again can be hard. Your employer may also stop paying in to your pension if you stop, check with your employer.

Use our retirement planning tool to help you plan ahead and see if you're on track to fund the retirement you want.

If you’ve previously opted out of the scheme, re-enrolment is an opportunity to start saving into your pension pot. Your employer is required to enrol you into the workplace pension scheme every three years if you’re still eligible and not currently a member of their pension scheme.

You have the right to opt out again within one month of being re-enrolled.

Although your pension with Legal & General may accept transfers, we would always recommend you speak to a financial adviser before transferring any other pensions you have to us.

Your other pension providers may charge you if you transfer out of their plan. There may be other benefits or guarantees attached to your pension that you might forfeit if you decide to transfer it. If you are a member of a defined benefit scheme with a transfer value of more than £30,000, you’ll need to take advice from an adviser authorised by the Financial Conduct Authority before you can transfer it.

Legal & General offer a Retirement Advice Service. Our advisers are experts in retirement regulated by the Financial Conduct Authority , so you can trust them to provide impartial advice and a personal recommendation that’s right for you.

If you decide not to speak to a financial adviser, you can contact our Employee Support Team on 0345 070 8686 to discuss transfer options that may be open to you. 

Lines are open between the hours of 8:30am and 7pm Monday to Friday.

Call charges will vary. We may record and monitor calls.

You can contribute up to 100% of your relevant earnings or £3,600 gross, if greater, into your pension plan and still get tax relief.

If your contributions go over the annual allowance including employer contributions (currently £60,000 in the tax year 2024/2025) you will incur a tax charge up to the highest rate you pay.

For those with earnings over £200,000 a year, and £260,000 a year when total pension contributions are included, the annual allowance may reduce below £60,000 but not less than £10,000. Please note it may be possible to carry forward unused annual allowances from up to three previous tax years.

If you have started drawing a flexible income from your pension pot, your annual allowance will reduce to £10,000 a year (this is called the Money Purchase Annual Allowance (MPAA)) and you can't carry forward any unused allowances. If you want to carry on building up your pension pot this may influence when you start taking income. Taking your tax-free cash lump sum without any other income doesn't affect your annual allowance.

Our retirement planning tool helps you understand how much you may need to pay in based on the retirement income you hope to get. If you join or are already in a company pension scheme, you should receive an annual statement from your pension provider showing the progress of your savings over the last year.

The size of your pension pot will depend on how much you pay in and for how long, together with how your chosen investment funds perform and the charges you pay. Generally speaking, the sooner you start and the more you pay in, the more you'll benefit at retirement.

Don't forget you may want to take into account any other savings or investments that you're relying on to provide an income when you retire.

In general, tax treatment depends on your individual circumstances and may be subject to change in the future.

If you are uncertain how to proceed we recommend you seek financial advice. 

Legal & General offer a Retirement Advice Service. Our advisers are experts in retirement regulated by the Financial Conduct Authority , so you can trust them to provide impartial advice and a personal recommendation that’s right for you.

You become entitled to a State Pension by paying National Insurance contributions during your working life. The more years you have paid National Insurance the larger your State Pension, with the maximum entitlement currently based on contributions of 35 years or more.

Like the name suggests, the State Pension is unlikely to give you enough income to fulfil all your lifestyle wants and needs in retirement. In the current tax year (2024/25), it only gives you £221.20 per week. If you were born before 6 April 1951 (if male) or 6 April 1953 (if female) the basic State Pension is £169.50 per week (for tax year 2024/25). And this amount could be even less if there have been any gaps in your National Insurance contributions record.

You might be able to get more but this will depend on your personal circumstances, for more information visit GOV.UK.

Find out more about State Pensions and see how much you'd be likely to receive from the state when you retire with a State Pension Forecast.

By joining your employer's pension scheme your income in retirement could be significantly more than if you just rely on the state as both you and your employer contribute.

The best place to get information about your options for your scheme is on your employer pension scheme website. If you don't know where that is, check with your employer. There will usually be a link on your employer’s intranet site.

Learn more about your options including a guaranteed income, flexible income, lump sums and cash.

You can also download our guide to taking money from your pensionPDF file: Taking money from my pension PDF size: 339KB  . 

You can request a retirement quote from our Claims team by ringing them on 0345 070 8686.

Lines are open between the hours of 8:30am and 7pm Monday to Friday.

Call charges will vary. We may record and monitor calls.

A personal or workplace pension where contributions and investment performance dictate how much money you have available to provide an income for retirement. Also referred to as ‘money purchase’ schemes as whatever pot you have built up can be used to provide an income in retirement.

The most common type of defined benefit scheme is a final salary scheme. The benefits depend on:

• Your number of years of service.
• Your final salary at the time you stop working for the employer.
• The accrual rates of the scheme (determined by your employer), which determines the percentage of your final salary you will get.

Defined benefit schemes can be:

• Contributory - both the employer and employee pay contributions to provide benefits.
• Non-contributory - only the employer pays contributions.

For further information on defined benefit schemes please speak to a financial adviser. 

Legal & General offer a Retirement Advice Service. Our advisers are experts in retirement regulated by the Financial Conduct Authority , so you can trust them to provide impartial advice and a personal recommendation that’s right for you.

You will need to check your policy documents or member’s booklet to find out whether you have a:

• WorkSave Pension Plan.
• WorkSave Mastertrust Plan
• WorkSave Pension Trust.
• Group Stakeholder Pension Scheme.
• WorkSave Buy Out Plan.
• Trustee Buy Out Plan.

You can find more information about the investments available to you by logging into Manage Your Account or visiting your scheme microsite/website. Our ‘Funds’ section lists the investments generally available to each of the above products. Your scheme may have chosen different investments for you than those listed.

The vast majority of people who join a workplace pension scheme invest in its default investment option which is designed to be broadly suitable for the majority of savers. You should remember that a default option has not been assessed against your own personal circumstances and so it might not be the right investment choice for you.

If you wish to choose your own investment options, we can help you understand the things you need to take into account. An important element of this is how much investment risk you're prepared to take in pursuit of a higher potential return.

A lifestyle is an investment strategy that changes the funds you are invested in as you approach your retirement date. They typically invest your money in funds that offer the potential for long term growth when you’re a long way from your retirement date. Then, as you approach retirement, they switch your money into different funds generally with the aim of reducing volatility or targeting a specific investment objective.

Please note - you can't combine a lifestyle profile with any other fund for any one benefit type, e.g. regular contributions, or a single contribution or transfer value. If you're already invested in a lifestyle profile and want to change your investment, you'll have to switch your existing pot and redirect any future payments for that benefit type. Likewise, if you'd like to start investing in a lifestyle profile, you’ll have to switch your existing pot and redirect future payments into the lifestyle profile for that benefit type..

Find out more about lifestyle profiles.

If your scheme allows, you can make changes to your investments by logging in to Manage Your Account. 

You can also make changes by calling us or sending us a request by letter or email. Please make sure you quote your plan number. If you make your request in writing you will need to complete a changing your investments form which you can download from the document library.

Please note - you can't combine a lifestyle profile with any other fund for any one benefit type, e.g. regular contributions, or a single contribution or transfer value. If you're already invested in a lifestyle profile and want to change your investment, you'll have to switch your existing pot and redirect any future payments for that benefit type. Likewise, if you'd like to start investing in a lifestyle profile, you’ll have to switch your existing pot and redirect future payments into the lifestyle profile for that benefit type.

Find out more about lifestyle profiles.

The value of your pension pot may fall as well as rise, and is not guaranteed. You should choose your funds carefully and review them regularly, particularly if you are close to retirement.