5 pension mistakes to avoid in your 40s that could affect your retirement

Posted 11.01.2022

Life begins at 40 … or so they say. By the time we reach our 40s, many of us will have built up a reasonable pension pot, but it’s still a great time to take stock and start to plan more for your future.

If you haven’t started saving into a pension yet, or you have an old pension scheme that you want to start contributing to again, it’s still not too late … but make sure you don’t make these mistakes that you could end up paying for later in your retirement.

  1. Putting paying off into a pension

Don’t put off paying into a pension. The sooner you start making contributions, the better. If you are not already part of a company pension scheme, you can contribute to a private one as a tax efficient way of saving towards your retirement.

  1. Not reviewing your existing pension provisions

Chances are you have been in a few different jobs by the time you reach your 40s, you may have several pension pots floating around. Each of them will be managed separately and charging you annual management fees. If you have numerous pensions and you want to know if they are still cost effective and meeting your objectives, you should take regulated financial advice to understand this and whether the existing pensions have any valuable benefits attached to them.

  1. Not understanding your attitude to risk

All investments come with some level of risk, and values can rise as well as fall. Your pension provider will usually offer several investment funds for you to choose from, with varying levels of risk.

By understanding your attitude to risk, you will be able to select funds which match your attitude to risk. Typically, people who invest into a pension in their earlier years will have a higher attitude to risk, but by the time we reach our 40s, you may want lower-risk options. It’s important to review your attitude to risk on a regular basis to make sure you are investing in funds which are suitable.

  1. Relying on property as a pension pot

If you own a property, and have built up equity, it can be tempting to think that it will see you through your retirement. Despite the rise in property prices over the years, this is not the safest way to invest in your retirement.  Ideally you need to save for a pension alongside paying off your mortgage so your home becomes part of a wider retirement plan.

  1. Not checking your state pension

The amount the state will contribute to your pension is based on your National Insurance contributions (NICs) history. It’s important to check whether you have any gaps in NIC contributions, particularly if you were out of employment for some time or living abroad. You can check your NIC contribution history online here: https://www.gov.uk/check-national-insurance-record


Whatever stage of life you’re at, our professional pension advisers can help you start or grow your pensions to help you really live the life you want in your retirement.

Contact us today for a no obligation pension consultation >>


The value of an investment with St. James’s Place will be directly linked to the performance of the funds selected and may fall as well as rise. You may get back less than the amount invested.

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