Pension Planning – Why Your Pension Needs a Review — Not Just a Statement
June 26, 2026
Most people glance at their annual pension statement, file it away, and assume everything is on track. But a statement only tells you what you have — not whether it’s enough, whether it’s working hard enough, or whether it still fits your life.
1 in 3
UK adults have never reviewed their pension — even once.
£37,000
Average retirement income shortfall for those who never reviewed their pension.
11+
Average jobs held in a lifetime — each potentially leaving behind an unclaimed pension.
Sources: Association of British Insurers / FCA Financial Lives Survey. Figures are illustrative.
Why a Statement Is Not the Same as a Review
Your pension statement is a snapshot — a point-in-time figure. It tells you the current value of your fund, perhaps an estimated retirement income projection, and the funds you are invested in. What it does not tell you is far more important:
- Is your target retirement income still realistic given inflation, market performance, and changes to your spending plans?
- Are your investments appropriate for your current risk profile, time horizon, and financial goals?
- Are you contributing enough — or could you be contributing more efficiently through salary sacrifice or employer matching?
- What happens to your pension if you die — have you updated your expression of wishes with the correct beneficiaries?
- Do you have pensions from previous employers sitting dormant in poor-performing funds with high charges?
“A pension statement tells you where you are. A pension review tells you where you are going — and whether you will actually get there.”
KPW Investments
The 5 Moments When a Pension Review Is Critical
Life does not stand still — and neither should your pension strategy. These key life and financial triggers should prompt an immediate review:
📈 1. A Significant Salary Increase or Bonus
Higher income means greater pension contribution potential. A review at this point ensures you are maximising tax relief, fully utilising salary sacrifice, and not missing your annual allowance.
🏠 2. Approaching Retirement (10 Years Out)
This is arguably the most critical window. Investment strategy should begin to de-risk. Drawdown versus annuity decisions need careful planning. Tax-free cash options must be properly evaluated.
💼 3. Changing Jobs or Going Self-Employed
Each job change risks leaving a pension behind. Self-employment often means contributions stop entirely. Consolidating and redirecting contributions ensures nothing falls through the cracks.
👨👩👧 4. Marriage, Divorce or Death of a Partner
These life events directly affect pension planning — from updating beneficiary nominations to reassessing spousal pension provisions and tax-efficient wealth transfer on death.
📊 5. A Change in Tax Legislation
Pension rules change regularly. The abolition of the Lifetime Allowance, changes to Annual Allowance tapering, and the planned inheritance tax treatment of pensions from 2027 make timely reviews essential for anyone with significant pension assets.
What a Proper Pension Review Covers
A professional pension review from KPW Investments goes far beyond your annual statement. It is a structured, holistic assessment of your entire retirement strategy:
| Review Area | What We Assess | Why It Matters |
|---|---|---|
| Fund Performance | Are your investments delivering appropriate returns for their risk level? | Poor fund selection can silently erode years of retirement savings |
| Charges and Fees | Total expense ratio, platform costs, adviser charges | Even a 0.5% difference in charges can reduce your pot by tens of thousands over 20 years |
| Contribution Levels | Are you on track to hit your retirement income target? | Small adjustments now have a disproportionately large impact over time |
| Risk Profile | Does your strategy match your risk tolerance and timeline? | Too much or too little risk at the wrong time can be costly |
| Tax Efficiency | Annual Allowance, Carry Forward, salary sacrifice optimisation | HNW individuals often leave significant tax relief unclaimed |
| Death Benefits | Nomination of beneficiaries, lump sum vs. drawdown on death | Ensures your wealth passes to the right people, efficiently |
| Consolidation | Multiple legacy pensions assessed for consolidation suitability | Simplifies management and often reduces costs significantly |
Pension Planning for High Net Worth Individuals: It Is Different
If you are a higher or additional-rate taxpayer, a business owner, or have accumulated significant assets, pension planning carries additional complexity — and significant opportunity. Standard auto-enrolment pensions are rarely structured to take full advantage of your position.
Tax Relief at 40% or 45%
Every £1,000 of pension contribution costs a higher-rate taxpayer just £600 after tax relief — and just £550 at the additional rate. For large contributions, this is a powerful wealth-building mechanism that should not be underused.
Using Carry Forward
The Annual Allowance Carry Forward rules allow you to use up to three prior years of unused pension allowance in a single tax year — potentially contributing up to £200,000 in one year while receiving full tax relief.
Inheritance Tax Planning
From April 2027, pensions will be brought within the scope of inheritance tax. This is a significant change requiring immediate planning — particularly around the order in which you draw down assets and how your pension integrates with your wider estate plan.
⚠️ The 2027 Inheritance Tax Pension Change: Act Now
Currently, pensions sit outside your estate for inheritance tax purposes — making them one of the most tax-efficient ways to pass wealth to the next generation. From April 2027, this changes. Unused pension funds will become subject to IHT at 40%.
If you have significant pension assets and an estate that may be subject to IHT, this is one of the most important planning issues of the next two years. A review now could save your beneficiaries tens of thousands — or more.
The Real Cost of Doing Nothing
Inaction is not a neutral choice when it comes to pensions. Consider this scenario:
❌ Without a Review
James, 52, has not reviewed his pension in 8 years. He has three old workplace pensions from previous employers, all in default lifestyle funds with annual charges of 1.2%. His total pot is £380,000 — but poor fund performance and high charges mean he is on track to retire with significantly less than he expects. He has no idea he could have been contributing far more tax-efficiently as a higher-rate taxpayer.
✅ After a KPW Review
After a comprehensive review, James consolidates his three pensions onto a single low-cost platform (reducing charges from 1.2% to 0.45%), moves into an investment strategy aligned with his risk profile, and begins salary sacrificing an additional £1,500 per month — saving £7,200 in income tax annually. Projected retirement income improves by over £18,000 per year.
Book Your Complimentary Pension Review
Pension planning is not a set-and-forget exercise. Whether you have not reviewed your pension in years or recently experienced a major life change, now is the right time to take stock.
At KPW Investments, we offer a complimentary initial pension review for prospective clients. No obligation. No jargon. Just clarity on where you stand — and what steps, if any, you should take.
KPW Investments is authorised and regulated by the Financial Conduct Authority. Pension advice is subject to individual circumstances. The value of investments can go down as well as up. Past performance is not a guide to future performance.
