Questions about your workplace pensions?

Workplace pension
  • 26th March 2020

We have pulled together a list of questions that we are getting asked in relation to your investments and pensions.

We have pulled together a list of questions that we are getting asked in relation to your investments and pensions. We have tried to answer as many as we can but if you do have a specific question about your investment or pension scheme with us, please do drop us a line.

Q. What is the impact on my workplace pension if my hours and salary have been reduced?


A. Pension contributions are a percentage of your salary, so if this has been reduced, your contributions should be lower too. Your employer should check that they are still in line with any specific arrangements they have in place with you.

Q. I’ve been asked to take unpaid leave, how will this affect my pension contributions?

A. If you have been asked to unpaid leave, your employer is unlikely to pay pension contributions during this period.

Q. What can I do if I can’t keep up my regular pension contributions?

A. You should be able to either reduce or stop your contributions and then restart when you are ready without any charge.

Please do be aware however that if you do stop your contributions, the amount you get at retirement will be reduced. Therefore we would recommend that you think carefully about the impact this might have on your income in retirement.

Another consideration if you are contributing to a pension offered by your employer rather than a private pension is that if you decide to pay less into your workplace pension, it could affect the amount your employer contributes too. We would definitely recommend speaking with your employer about this. In some cases there may be a legal obligation on your employer to continue paying contributions so please do discuss this with them.

Q. I’m off sick, will my pension contributions continue?


A. If you are still being paid whilst off sick then Yes, your employer will be required to deduct contributions from your salary. Statutory Sick Pay also forms part of qualifying earning rules if you are in your employer’s auto enrolment scheme.

Q. Is there an option to cash in my plan in early?

A. The money in your pension is not available until you reach the age of 55. If, due to ill health, you can no longer work, you may be able to start taking money from your pension. You would need to speak with your pension provider for clarity though as they don’t all offer this.

The Pensions Advisory Service offers free and impartial guidance to people with workplace and personal pensions. Go to moneyandpensionsservice.org.uk

Q. Can I take some income from my pension early to help me?

A. You will be able to take some money from your pension if you are over 55. There are however some factors that you should take into consideration:

  • How will your future retirement income be impacted if you withdraw funds from it now?
  • Will there be limitations to contributions you may wish to make in the future?
  • What are the tax implications of taking money from your pension now?

When you think about these factors, it makes the decision of whether or not to take income early from your pension a very complex one. This is why we would strongly suggest that you speak to a financial adviser.

The Pensions Advisory Service offers free and impartial guidance to people with workplace and personal pensions. Go to moneyandpensionsservice.org.uk

Q. I’m already taking income from my pension, can I increase this?

A. This will depend of the type of retirement plan you have. If it is a secure income (annuity) then you will not be able to change this.

If however you have Income Drawdown, then you will be able to change the level of income you take. Do think carefully about any changes you make however as they could have an impact on not only how long your pension will last but also could affect how much tax you pay. In addition, if your drawdown was set-up before April 2015, it may be a “capped” drawdown with limits on how much you can draw annually. You can remove this limit by turning the plan into a “flexi-access” one, but this will restrict the amount of pension contributions you can make in the future (from £40,000 p.a. to just £4,000 p.a.).

The Pensions Advisory Service offers free and impartial guidance to people with workplace and personal pensions. Go to moneyandpensionsservice.org.uk

Q. I’d like to move my investment to cash, can I do this?

A. Making decision based on what is happening with the economy in the short term can be very risky. You may think that this is the safest place for your money but by moving your investment you might miss out on the point when the values go back up meaning in the long term you will miss out.

History of global crashes, recession and virus outbreaks has shown that values usually go up in the long term, despite the short term volatility.

If you are considering changing your investment, please do speak to one of our advisers first.

All data and figures referred to in our news section are correct at the date of publishing and should not be relied upon as still current.