How do you find out what pension you will get on retirement?

(UK Answer)

There are in essence three types of pension plan in the UK. Each have a different method of obtaining a projection of your future retirement benefits.

These are:-

1) Your state pension. A pension paid to you by the Department for Work and Pensions based on your national insurance record from during your working life

2) Any personal pensions. These are pensions that you have chosen to save within during your working life. These could be with a Life insurance company or a bank.

3) Any occupational pension pensions. These are pensions that are set up and managed by your employer. There are various types of occupational pension schemes that exist

1) State Pension forecast

Your state pension is calculated by your national insurance record that you build up during your working life. You can obtain a projection of your state pension online. (See the related link)

2) Personal Pension Projections

Your pension provider, for example a life insurance company or bank will be able to provide you with an indication of how much your pension will be when you come to retire. Pension projections and statements can be complicated to understand, and therefore you might like to consider taking financial advice.

3) Occupational Projections

Your employer, or the payroll/HR department will usually be able to tell you whom you should contact in order to obtain a projection of your future benefits. If you no longer work for the employer that set up your pension plan you may like to try the pension tracing service, which can be found online. (See the related link)

There are different types of occupational pension schemes. However, these could be broadly classified in to 2 types.

Firstly, Defined Benefit or Final Salary. This is where you will receive a known amount of income based on your years-service for your employer and your income either throughout your employment history or your salary in the final year before retirement.

Secondly, there is Defined Contribution or Money Purchase. This is where the amount of income at the end of your working life is based on the amount of contributions that are made by you or your employer throughout your working life.