How to protect your pension from a midlife curveball

The problem with long-term savings goals – like retirement – is that it’s easy for more pressing financial challenges to take precedence.

From childcare to home renovations, holidays to spiralling bills and potentially university fees, there are often pressures that feel more demanding than a distant retirement.

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Even if you’re making some contributions into your pension each month, it’s tempting to put full-blown retirement planning on the back burner, until you’ve got more money to spare. You’ll pay more in when the kids leave home, when you get a pay rise or the mortgage has been paid off.

But while you might think of your 50s as the decade where you’ll really prioritise your pension, it can sometimes be an unexpectedly difficult period of your life.

Midlife challenges

Nobody likes to contemplate the fact that their lifestyle could take a turn for the worse. But as you enter your 50s, there’s a greater risk of problems that could jeopardise the amounts you can earn and save.

• Work

Lots of us, understandably, assume that our earnings will keep rising steadily as we progress through our careers. But the age of peak earnings is actually 47, according to the latest data from the Office for National Statistics (ONS). Of course, not all of us will see our earnings drop – the figure is arguably skewed by the fact that higher earners retiring early will bring down the median figure. Nonetheless, it’s important not to underestimate some of the challenges that could present themselves.

ONS data shows that the risk of redundancy is generally greatest among those over 50. And, unfortunately, it may not be the ideal stage of life to find yourself job hunting. The Centre for Ageing Better, describes ageing as “the least scrutinised and most widely accepted form of discrimination in the UK”. When you do find new work, you may find yourself on a lower salary.

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Or, it may be that you simply reach a point in your life where your appetite to remain in a competitive or stressful workplaces wanes and you simply want to slow down and do something more enjoyable before you retire.

• Health

It’s also an unfortunate fact of life that your health may deteriorate as you get older.

The latest government figures suggest that 54% of people who were out of work due to long-term sickness were aged between 50 and 64, equivalent to 1.4 million people.

And it’s not always life-threatening illnesses that can keep you off work. Analysis of Civil Service absence rates in 2025, attributed almost half of long-term absence (47.1%) to mental health problems.

Meanwhile, one in 10 women who worked through the menopause, quit their job altogether as a result of their symptoms, according to research from the Fawcett Society.

• Care

It’s not just your own health that could affect your ability to earn.

Some 2.6 million people have had to quit their job to care for a loved one, according to research from Carers UK.

Most unpaid carers are aged between 55 and 59, and 59% (overall) are women.

Carers UK State of Caring survey 2025 found that 69% of those carers who are still employed, said that they hadn’t been able to focus on their career, while 61% said that their caring responsibilities had limited their employment options. One in five had to take on a lower-paid job.

Stopping pension contributions in your 50s: the impact on your retirement

If you find yourself unable to make further contributions into your pension in your 50s, it could have a significant impact on your eventual retirement.

Let’s take two 55-year-olds with £100,000 already saved in a pension.

If our first stayed in work, contributing 10% of their £50,000 salary into their pot (increasing by 2.5% a year), 12 years later they would have a pension worth £272,758 (assuming 5% growth) when they reach 67 (state pension age).

But life throws our second individual a curveball and they can’t make further contributions into their pension. As a result, their £100,000 pot is only worth £181,985 when they turn 67 – a difference of more than £90,000.

And their retirement income could be reduced even further, if their circumstances mean they need to call on their pension earlier than they anticipated (you can access your pension from age 55, rising to 57 in 2028).

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How to protect your pension from a midlife crisis

Of course, your 50s aren’t destined to be a decade of struggle and stress. With a fair wind you’ll stay healthy and carry on working and earning in a way that works for you – lining your pensions and savings as you go.

But it’s important to be mindful of the risks and not put off retirement planning as a problem to be tackled in the future.

By prioritising your pension in your 40s – even your 30s if you can – you’ll buy your retirement income some protection and reduce the potential hit if a change of circumstances forces you to reduce your contributions at some point.

And, if life doesn’t force you to wind down, the healthier your pension, the more freedom and control you’ll have to decide how you want to work – or retire.

The obvious first step is to pay as much into your pension as you can afford. It’s not easy and requires a bit of willpower, but there are some ways to ease the pain and increase the pay back.

• Find out if your employer will boost your contribution

If you agree to pay more into your workplace pension, many employers will match your contribution (up to a cap). The more you pay in, the bigger the top up you’ll get.

• Pay a work bonus into your pension

If retirement is still a long way off, it takes discipline to pay a bonus into your pension. But get your head around the tax benefits and it’s well worth the effort. By paying a bonus, or part of it, into your pension, tax relief means you’ll get the full amount, without losing any to the taxman (as you would if it was paid through payroll).

If you make contributions through salary sacrifice (or bonus sacrifice), you can enjoy national insurance (NI) savings as well as income tax. The combined tax saving could total 47%, or perhaps even higher if you’re caught in a tax trap.

Although salary sacrifice rules are changing, you still have three tax years to make the most of the current system (from April 2029, the maximum you’ll be able to pay into a pension in this way and get NI savings, will be capped at £2,000 a year).

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Appreciate the benefits of compounding

Compounding – where your returns (dividends) start earning returns when reinvested – is one of the most significant drivers of growth when you’re investing over the long term. So, the sooner you can get money into your pension, the longer it will have to grow.

But paying more money into your pension isn’t the only way to fortify your retirement pot.

There are several steps you can take that could boost its value over time.

1) Review your investment strategy

You shouldn’t take unnecessary risk with your retirement savings, but with time on your side, you shouldn’t be too cautious either. By taking a balanced approach you may be able to improve your returns. Although most people save into a default fund with their workplace pension, it’s normally possible to select alternative options if you have the confidence to switch. If you run your own personal pension, there may also be an argument for switching out of actively managed funds and into passive funds. Charges will be lower but returns – in many cases – are similar.

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2) Combine old pensions into one

If you’ve changed jobs and have a handful of workplace pensions that you no longer contribute to, it may make sense to consolidate them into a self-invested personal pension (SIPP). Not only will this make your retirement savings easier to track and manage, you can often cut your charges, too.

3) Get a state pension forecast

If your private pension takes a hit, you’ll be even more reliant on the state pension. You can buy voluntary NI contributions if you’ve got gaps in your record and it doesn’t look like you’ll get the 35 years required for the full state pension.

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But, as you can only plug gaps from the last six years, it’s important to find out where you stand as soon as you can. Leave it too late and you may lose the opportunity to plug any gaps.