In this guide
Preparing for your retirement needn’t be an expensive process. If you just want to take an initial look at your options, there are a number of government-backed tools that can provide cost-effective guidance.
Midlife MoT
The Midlife MoT is a free digital tool aimed at those aged 45 to 65 to help you to improve your overall financial health and plan a more comfortable retirement.
The five-minute questionnaire on MoneyHelper.org.uk asks you about your savings, pensions, insurance, goals and benefit eligibility. Upon completing it, you’ll receive a personalised report that will point you to links and information on focus areas, such as estate planning, tackling debt, or building an emergency fund.
Increasing numbers of employers are also offering midlife MoTs to help employees to take stock of their financial wellbeing, so it may be worth seeing what’s available at work.
Read more: A simple guide to pensions
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PensionWise’s free 60-minute guidance
PensionWise, run by MoneyHelper, offers a free 60-minute appointment with a pensions specialist to those aged 50 and over to discuss topics such as how to take money from your Sipp or workplace scheme, plus the tax implications of doing so.
You’ll need to know the type of pension, its value, and your entitlement to a state pension. The session is done on the phone, but there are limited spaces in person at selected Citizens Advice offices.
Read more: Our best SIPP providers
‘Free guidance was better than a paid consultation”
Natalie McKay, a 62-year-old author from Suffolk, made use of the PensionWise service in 2022 after feeling the weight of deciding what to do with her £100,000 pension pot. She describes her experience as “enormously helpful” and better than a paid consultation she previously sought. “The consultation lasted well over the allotted hour, I had time to repeat some questions and make notes, and it gave me the confidence to eventually opt for an annuity. I got an annuity rate of 6 per cent for my pot and now receive £518 a month.”
The £1,500 tax break for advice
The Pensions Advice Allowance allows you to take up to £500 out of your pension three times before you reach the age of 55 if you use it to pay for advice. It’s a savvy way to access advice at different stages in your life as your priorities and goals change.
Rebecca O’Connor, director of public affairs at PensionBee, says the “little-known, under-used perk” can effectively save basic-rate taxpayers £750 if they maximise the scheme’s use rather than pay for advice from their taxable income.
“That’s because when they paid £1,500 into their pension originally, this would have cost £750, with a further £562.50 coming from their employer and £187.50 from basic rate relief,” O’Connor says.
Not all pension providers offer the Pension Advice Allowance.
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