Education

Whether a stakeholder pension is still worth using depends on the saver's situation: self-employed, topping up provision, saving for a child, or seeking a simple capped-charge alternative outside the workplace.

Annuities shift longevity andInvestmentrisk to an insurer and provide certainty; drawdown keeps the pot invested and offers flexibility and potential growth but with market and longevity risk.

In-scheme AVCs sit alongside the main workplace scheme (commonly run by Prudential, Standard Life, Legal &Amp; General or Scottish Widows for public sector employers). Free-Standing AVCs (FSAVCs) are separate contracts with an insurer, now less common since stakeholder pensions and SIPPs grew.

In 2025/26, the headline rules include a 60,000-pound standard Annual Allowance, a 10,000-pound Money Purchase Annual Allowance after flexible access, a 268,275-pound Lump Sum Allowance, a Normal Minimum Pension Age of 55 (rising to 57 from April 2028) and contribution limits of 100% of …

The case for AVCs strengthens for higher-rate taxpayers, for employees near retirement with unused tax-free cash capacity in a defined benefit scheme, and for those with access to salary sacrifice. The case weakens where competing priorities such asDebtrepayment,Mortgageclearance or insufficient emergency savings dominate.

Self-employed UK workers do not benefit from auto-enrolment and need to set up their own pension provision. A SIPP can offer flexible contributions, tax relief at the saver's marginal rate and a wide investment range. This article explores how SIPPs fit self-employed circumstances, the …

Unlike a defined benefit scheme, the final value depends on contributions paid,Investmentperformance and charges, not on salary or service years.