Your workplace pension might be one of the biggest investments you’ll ever own, yet most people have never looked at where it’s invested. If you’ve never logged in, it’s almost certainly sitting in the default fund: an investment chosen for everyone, not for you.
This isn’t financial advice, and your circumstances matter. But a 20-minute check could make a real difference to your retirement.
Step 1: Make sure you’re getting the full employer match
Under auto-enrolment, most employees get a pension with a minimum total contribution of 8% of qualifying earnings, including at least 3% from the employer. But many employers offer more if you pay in more. For example, they might match up to 6% or 8% if you do the same.
If your employer matches and you’re not paying enough to get the full match, you’re turning down part of your pay. Check your contract, staff handbook or HR portal for “pension matching” or “enhanced contributions”.
Good to know: Pension contributions also get tax relief, so each £1 you pay in costs you less than £1. Combined with employer matching, it’s one of the best returns available anywhere. See how tax relief on pensions works.
Step 2: Find out where your pension is invested
Log in to your pension provider’s website or app. You’ll need your policy or member number, which is usually on your annual statement or in welcome emails from the provider. Look for:
- The fund name. “Default”, “Lifestyle”, “Target date” or “Balanced” are common.
- The annual charge. Often shown as an AMC or ongoing charge.
- What it invests in. Look for the split between shares, bonds and cash.
Step 3: Understand why the default may not suit you
Default funds are designed to be sensible for a huge range of people, so they’re often cautious. Many use “lifestyling”, which gradually moves your money from shares into bonds and cash as you approach retirement. That’s useful near retirement, but if you’re 30 or 40 with decades to go, a very cautious mix may grow more slowly than you’d like.
The charge cap on auto-enrolment default funds is 0.75% a year, but many funds charge much less, and over decades small differences add up, as our index fund guide shows.
Step 4: Look for a low-cost global index fund option
Many workplace schemes let you switch to other funds, and most offer at least one global equity index fund: a low-cost fund tracking thousands of companies worldwide. They may be run by large index providers such as Vanguard, BlackRock, Legal & General or HSBC, among others.
| Question to ask | Why it matters |
|---|---|
| What does it track? | Global funds spread risk across countries and sectors |
| What’s the yearly charge? | Lower charges mean more of the growth stays with you |
| How much is in shares vs bonds? | More shares usually means more growth and more ups and downs |
| When will I need the money? | The longer you have, the more risk you may be able to take |
Do your own research before switching. A 100% shares fund can fall sharply in a crash. If you’re unsure, a regulated financial adviser can help, and your scheme may offer free guidance.
Step 5: Gather up old pensions
If you’ve had several jobs, you may have several small pensions in old default funds. You can track down lost pensions with the free government Pension Tracing Service. Moving old pots into one personal pension or SIPP with low-cost global funds can make them easier to manage. Check for exit fees or guaranteed benefits first, and never transfer a defined benefit (final salary) pension without advice.
The short version
Get the full employer match, because it’s free money. Then log in and check where your pension is invested: default funds suit everyone, so they may not suit you. Many schemes offer a low-cost global index fund. Compare the charges and the mix of investments, do your research (or get advice), and revisit it once a year.
Common questions
Can I choose where my workplace pension is invested?
Usually, yes. Most defined contribution workplace pensions let you choose from a range of funds through the provider's website or app. Check your provider's fund list and charges.
Is the default fund bad?
Not necessarily. Default funds are designed to be reasonable for most people and have a charge cap. But they may be more cautious than you need, especially if you're young, so it's worth checking rather than assuming.
Can I move my workplace pension to a different provider?
You usually can't move your current employer's scheme, but you can often transfer old workplace pensions into a personal pension or SIPP. Check for exit fees or valuable guarantees first, and get advice before transferring a defined benefit (final salary) pension.
What is salary sacrifice?
It's an arrangement where you give up part of your salary and your employer pays it into your pension instead. You save Income Tax and National Insurance on that amount. From April 2029, the National Insurance saving is due to be limited to the first £2,000 a year.
This article is general information, not personal financial advice. Your situation is your own, so check the details for yourself or speak to a regulated adviser before making big decisions. Where investments are mentioned, their value can go down as well as up.
