5 Things to Check when your Pension Statement Arrives

As the tax year comes to a close, many pension providers begin issuing annual pension statements. For many people, the document arrives, gets skimmed briefly and is then filed away without much thought.

But your pension statement is more than just a summary of the past year. It’s an opportunity to check your progress, spot potential issues and make adjustments that could strengthen your retirement plans.

If your pension statement has recently arrived, here are a few key things worth checking.

1. Your Current Pension Value

Your statement will show the total value of your pension pot at the time it was issued. This gives you a snapshot of your retirement savings so far. While market movements can cause short-term fluctuations, it’s useful to consider whether your pension is steadily growing over time.

2. Contributions Over the Past Year

Check how much has been paid into your pension over the last tax year. This should include contributions from you, your employer, and any government tax relief. Ensuring these figures look correct helps confirm that your pension is receiving the contributions you expect.

3. Your Projected Retirement Income

Many statements include an estimate of the annual income your pension could provide when you retire. Although this is only a projection, it can be a helpful guide when assessing whether your current savings are likely to support the lifestyle you hope to enjoy in retirement.

4. Investment Performance

Your pension savings are typically invested in funds designed to grow over time. Your statement may provide an overview of how these investments have performed during the year. Short-term ups and downs are normal, but it’s still worth checking whether your investment approach remains suitable for your retirement timeline.

5. Charges and Fees

Pension providers charge fees for managing your pension and investments. While these charges are often small, they can have an impact on your savings over time. Your annual statement should outline the costs associated with your pension plan, helping you understand how much you’re paying for the service.

Signs Your Pension May Need Attention

While reviewing your pension statement, certain details may suggest it’s worth taking a closer look at your retirement planning.

For example:

Contributions appear lower than expected

Your projected retirement income has fallen significantly

Your pension pot hasn’t grown as much as you anticipated

Charges seem higher than you realised

These situations don’t necessarily mean something is wrong, but they may indicate it’s time to review your pension strategy more carefully.

What to Do If Something Doesn’t Look Right

If anything on your pension statement raises questions, it’s worth investigating further rather than ignoring it. You might consider:

Contacting your pension provider to clarify contributions or charges

Reviewing your investment choices to ensure they still suit your goals

Increasing contributions if your projected retirement income looks lower than expected

Tracking down pensions from previous employers to understand your full retirement picture

The value of pensions and investments can go down as well as up, and you may get back less than you invest. This information is for general guidance only and does not constitute financial advice.

Small adjustments made today can have a meaningful impact over the long term.