I receive a final salary pension, am retired and want to invest. Can I start another pension as a saver?

Collette | Greater London| 25/11/2017 | 0

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Collette's question in full

I am already receiving a pension from a final salary scheme and I am retired. I have a sum of money I want to invest. Can I start another pension as a saver and, if so, how much can I put in every year?

Danny Cox's Response

Yes you can. You can pay in £2,880 per tax year (this tax year runs from 6th April 2017 – 5th April 2018) and the government will add £720 to make a total of £3,600. If you are still earning you may be able to invest more. If you are a higher or additional rate taxpayer you may be able to claim some more tax back through self assessment.


When you withdraw money from the pension, the first 25% of the value of your pot is normally tax free with the balance taxed at either 20, 40 or 45% depending on your other taxable income.


The tax position becomes more complicated and expensive if your overall pension savings, including the final salary scheme, exceeded what is known as the Lifetime Allowance. You should have a statement or if not, your final salary pension provider will be able to tell you what proportion of your Lifetime Allowance you have used up.

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Danny Cox

Danny has years of experience in personal finance and helping people make the most of their money. Amongst his awards is the coveted Money Management Financial Planner of the year and he is one of only 1% of advisers who are qualified as both Chartered and Certified Financial Planner.

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