Marvin OnumonuAegon has advised individuals not to let Budget fears derail their pension planning ahead of the Autumn Budget on 26th November 2025.
Steven Cameron, pensions director at Aegon UK, said there has been a lot of speculation over possible changes to pensions, but most rumours are unlikely to happen.
Cameron said: “It’s important people remember the positives of pensions and don’t let Budget fears derail their retirement planning.”
Cameron pointed out that pensions come with valuable tax perks, and there is always a risk the Chancellor could change these or target them at lower and medium earners.
He said that every year there is talk about reducing the tax-free lump sum or changing how tax relief works, which has previously caused people to take out their tax-free cash in a panic, only for nothing to change.
Cameron added: “In the past, whoever was in Government has followed a convention not to make ‘retrospective’ changes.
“In other words, they’ve made sure individuals who have built up pension entitlements in the past were ‘protected’ from any new taxes on these existing savings.
“Instead, new rules generally apply only to future savings. So even if there are changes, we hope they wouldn’t affect what’s already been built up.”
He said: “What is for sure is that currently, pensions are the best means of saving for retirement.
“Even before adding in the tax perks, workplace pensions in particular are a fantastic deal, as employees also benefit from valuable employer contributions.
“Also, if income tax rates do go up, pensions tax relief which is granted at an individual’s highest marginal rate, would go up too, becoming even more valuable.”
He added: “Pensions are also good for the economy. Since coming into power, the Government has been focusing strongly on pensions and the billions they have in funds as a source of investment, to help boost the economy and drive UK economic growth.
“The Government recently launched an independent review looking at how to make sure the millions of people who aren’t saving enough, save more adequately for retirement.
“We’ll keep pushing the Government to help more people make greater use of pensions. We need long-term policies for long-term pension planning, not short-term tax tinkering.”
He said: “With all this in the background, we hope the Chancellor remembers the positives of pensions – not only do they help individuals plan for their future, they’re also good for the economy and UK growth.
“It would be a short-sighted Budget that did anything to damage pensions.”
