Blog

<div></div><div><br></div><div><p>Family leave (maternity, paternity, and adoption leave), as well as part-time working or taking a career break, can ultimately impact your pension contributions and pension benefits you receive. </p><p>Here’s a straightforward guide to what you need to know. You can jump to the relevant section of the article using the links below.</p><ul><li><a href="#section1" data-sf-ec-immutable="">Types of family leave</a></li><li><a href="#section2" data-sf-ec-immutable="">Your pension during family leave</a></li><li><a href="#section3" data-sf-ec-immutable="">Working part-time</a></li><li><a href="#section4" data-sf-ec-immutable="">How to make the most of your pension with the Scheme</a><br></li></ul><h3 id="section1">Types of family leave</h3><h4><span style="background-color: initial; font-size: inherit; text-align: inherit; text-transform: inherit; word-spacing: normal; caret-color: auto; white-space: inherit">Maternity pay and leave&nbsp;</span></h4></div><div><span style="background-color: initial; font-size: inherit; text-align: inherit; text-transform: inherit; word-spacing: normal; caret-color: auto; white-space: inherit">The following are your statutory rights, but your employer may have a different policy.&nbsp;&nbsp;</span></div><div><br></div><div>You are entitled to statutory maternity pay if you:&nbsp;</div><div><br></div><ul><li>have worked for your employer for 26 weeks when you reach the 15th week before your due date, and&nbsp;</li><li>earn on average at least £129 per week.&nbsp;</li></ul><div>You’ll be entitled to 52 weeks statutory maternity leave and receive statutory maternity pay for 39 weeks. For the first six weeks, you’ll get 90% of your average weekly earnings. For the next 33 weeks, you receive 90% of your weekly earnings, or £194.32 a week, whichever is lowest. The remaining 13 weeks are unpaid.&nbsp;&nbsp;</div><div><br></div><div>You don’t have to take the 52 weeks you’re entitled to, but you must take at least two weeks off work following the birth.&nbsp;</div><div><br></div><h4>Paternity leave&nbsp;</h4><div>Under the same rules as statutory maternity pay, you are entitled to two weeks’ statutory paternity pay. The weekly rate is £194.32 or 90% of your average weekly earnings, whichever is lower.&nbsp;</div><div><br></div><h4>Adoption leave&nbsp;</h4><div>If you’re adopting or having a child through surrogacy, you’re usually entitled to paid time off work. This is subject to the same rules and requirements (as above) for maternity pay and the pay structure is identical.&nbsp;</div><div><br></div><div>If you’re adopting as a couple, only one person can get adoption leave. The other might be able to get paternity leave or shared parental leave.&nbsp;</div><div><br></div><h4>Shared parental leave&nbsp;</h4><div>Alternatively, you and your partner may be able to get shared parental leave and statutory shared parental pay. You can share up to 50 weeks of leave and up to 37 weeks of pay between you.&nbsp;</div><div><br></div><div><h3 id="section2">Your pension during family leave &nbsp;</h3></div><div>Your pension Scheme membership will be continuous while you are off, unless you have an agreement with your employer for this to be different. Your pension contributions may change during family leave, because pension contributions are calculated using a percentage of your earnings. However, if you are in a defined benefit (DB) section of the Railways Pension Scheme, your pension benefits will not be affected. If you are in the Industry-Wide Defined Contribution (IWDC) Section, it will be affected by any reduction to the contributions paid in.&nbsp;</div><div><br></div><div>If your pay reduces to nil, then your contributions will stop and your pension benefits may be affected. Your employer may continue to pay them on your behalf, but you may have to pay these back once you return to work – you would need to arrange this directly with your employer.&nbsp;</div><div><br></div><div>While you’re on family leave, your pension benefits won’t be affected, as long as you haven’t opted out of your Scheme membership and contributions are paid. Your overall benefits will still be based on your final average pay.&nbsp;</div><div><br></div><div>For more information, check the &nbsp;<a href="https://cdn-suk-memberportal-preprod-002.azureedge.net/mp-sitefinity-preprod/docs/default-source/rayn/guides-for-active-(contributing)-members/guide-for-family-leave.pdf?sfvrsn=9db485ae_12" target="_blank">family leave guide</a>.&nbsp;</div><div><br></div><h4>The gender pension gap&nbsp;</h4><div>The career breaks women take to care for their families’ amount to £39,000 in lost pension savings, according to NOW: Pensions’ 2024 gender pensions gap report. This is because, in many cases, women pause their careers or go part-time to care for their children (this is sometimes known as the ‘motherhood penalty’).&nbsp;</div><div><br></div><div>The <a href="https://adviser.scottishwidows.co.uk/assets/literature/docs/61536.pdf" target="_blank" data-sf-ec-immutable="">2025 Women and Retirement report</a>, produced by Scottish Widows, shows that the median annual retirement income of UK mothers is 32% lower than men’s (£13k for women vs £19k for men), largely driven by women having longer career breaks, doing part-time work, freelancing or taking on multiple jobs. However, this means that many women might not be earning enough to pay into a private or workplace pension. People in the UK need to earn at least £10,000 a year to meet the criteria for pension &nbsp;<a href="https://www.moneyhelper.org.uk/en/pensions-and-retirement/auto-enrolment/automatic-enrolment-an-introduction" target="_blank" data-sf-ec-immutable="">auto enrolment</a>.&nbsp;</div><div><br></div><div>The 2024 gender pensions gap report also shows that women are far more likely to take time out of work to care for an elderly or sick family member.&nbsp;</div><div><br></div><div>What is more, the fact that they’ll have worked less years throughout their life could reduce their <a href="https://www.gov.uk/new-state-pension" target="_blank" data-sf-ec-immutable="">State Pension</a> entitlement if they do not build enough qualifying National Insurance years (although credits such as child benefit can help to protect this). To get any State Pension, people in the UK are required to have worked for a minimum of 10 qualifying years. To get the full State Pension, 35 qualifying years of work are required.&nbsp;&nbsp;</div><div><br></div><div>The 2025 Women and Retirement report also says that around half of all women have taken a career break compared with only one in five men. Around one quarter of women over 55 have spent five years or more out of the workforce, which increases the risk of not qualifying for any State Pension further down the line. You can check your <a href="https://www.gov.uk/check-state-pension" target="_blank" data-sf-ec-immutable="">State Pension forecast</a> on the government’s website.&nbsp;</div><div><br></div><div><h3 id="section3">Working part-time</h3></div><div>Many parents, especially mothers, choose to work part-time to balance work and family. While this offers flexibility, it affects your pension.&nbsp;</div><div><br></div><div>If your working hours change it’s likely your wages will too. That means how much you pay into your pension may also change. The amount that you pay into your pension is worked out using your full-time rate of  <a href="https://member.railwayspensions.co.uk/knowledge-hub/help-and-support/glossary" data-sf-ec-immutable="">Section Pay</a> for your job, but is reduced for the hours you work.  &nbsp;</div><div><br></div><div>If you go part-time then you’re still entitled to the same range of benefits as your full-time colleagues. However, the amount you pay in and the amount you receive will be based on the part-time hours you work. You can find out more in the  <a href="https://cdn-suk-memberportal-preprod-002.azureedge.net/mp-sitefinity-preprod/docs/default-source/rayn/guides-for-active-(contributing)-members/guide-to-part-time-work166beabb5d844e31a0839a6ff1bb075b.pdf?sfvrsn=4d5472da_9" target="_blank">guide to part-time work</a>.&nbsp;</div><div><br></div><h4>The gender pay gap&nbsp;</h4><div>The gender pay gap – the difference between the earnings of men and women – is deemed one of the major drivers of the pension gap. Women have been earning (and still earn) less than men on average, although <a href="https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/bulletins/genderpaygapintheuk/2025" target="_blank" data-sf-ec-immutable="">2025 figures</a> show a narrowing of this gap over time.&nbsp;&nbsp;</div><div><br></div><div>In April 2025, women earned an average of 6.9% less than men per hour, according to the ONS (down from 7.1% in April 2024).&nbsp;</div><div><br></div><div>The significant gap in income means women have less capacity to meet increasing financial demands. The 2025 Women and Retirement report, by Scottish Widows, suggests that on average, 24% of men have savings above £10,000 compared to only 16% of women. Men are also more likely to be able to draw from other long-term savings sources in retirement, with 37% of them investing in stocks and shares ISA, compared to 26% of women.&nbsp;</div><div><br></div><div>It’s not all doom and gloom for women, though. The 2024 pension gap report shows a positive tendency of more women undertaking higher education and therefore entering the workforce with higher salaries. If the trend continues, the gender pay gap is likely to reduce further over the coming years, as more young women go on higher education. This could mean better retirement outcomes too.&nbsp;</div><div><br></div><div><h3 id="section4">How to make the most of your pension with the Scheme&nbsp;</h3></div><ul><li>Make sure you register for a myRPS account so you can take advantage of all the guidance and pension planning tools available to help you prepare for retirement. <a href="https://member.railwayspensions.co.uk/login" data-sf-ec-immutable="">Register and/or log in </a>and check your account today.&nbsp;<br></li><li>Don’t forget your National Insurance (NI) credits. Many benefits, including child benefits, automatically give you NI credit. Some women don’t sign up for child benefit because if their partner earns over £50,000 they would have to start paying it back.  But you don’t need to actually receive the cash – you can just sign up to ensure your NI record and then your State Pension will be protected.&nbsp;<br></li><li>You could consider extending your working life. Your Railways Pension Scheme pension will offer you a Normal Retirement Age (NRA) but normally you can work and remain a member beyond this date. <a href="https://member.railwayspensions.co.uk/login" data-sf-ec-immutable="">Log in to your myRPS account</a> to check what your NRA is.&nbsp;<br></li><li>Putting in a small, extra regular amount now into AVCs (Additional Voluntary Contributions), could go a long way towards a better future. You can put as little as £2 extra per week. This means you make the most of the valuable tax relief you get and the longer you have your money invested, the more chance it has to grow. If you’re a DB member of the RPS, the main AVC scheme is called <a href="https://member.railwayspensions.co.uk/defined-benefit-members/saving-more-BRASS-AVC-Extra/saving-more-with-BRASS" data-sf-ec-immutable="">BRASS</a>.  For IWDC members, you can <a href="https://member.railwayspensions.co.uk/iwdc-members/Im-still-working/saving-more" data-sf-ec-immutable="">save more with AVCs</a>.&nbsp;<br></li><li>If you’ve had a number of different jobs, don’t forget to check that you’ve kept track of all your past pension schemes. The Pension Tracing Service is free and can help you find a pension you’ve lost. Go to <a href="https://www.gov.uk/find-pension-contact-details" target="_blank" data-sf-ec-immutable="">gov.uk/find-pension-contact-details</a> and follow the online steps.&nbsp;</li></ul>

<p><strong></strong>Your pension is effectively a safeguard for the future. A way to make sure you have money to spend when you stop work.<span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"></span></p><p>With that in mind, it’s important you understand what your pension can do for you and how to make the most of it. That’s where a financial adviser might be able to help.<span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"></span></p><h3><strong>Do I HAVE to get financial advice? </strong></h3><p>There are a limited number of circumstances where getting financial advice is a legal requirement.&nbsp;For example, if the value of your DB benefits is more than £30,000 and you are looking to transfer to a scheme that provides flexible benefits e.g. a Defined Contribution or a Personal Pension Arrangement, then by law you have to get financial advice from an FCA-authorised adviser who is qualified to advise on transfers before the transfer can be made.</p><p>In most cases though, whether or not to get financial advice is entirely your choice. </p><p>Before that, you may find some of the answers you’re looking for in your Member Guide, or in the wide range of informative content available across the member website. </p><p>This includes a number of tools designed help you understand your pension and consider your options, such as:</p><ul><li>The <a href="/knowledge-hub/help-and-support/retirement-budgeting-calculator">Retirement Budgeting Calculator</a>, to help you work out how much income you might need, to enjoy the lifestyle you hope when you stop work</li><li>A retirement modeller for IWDC members and a pension planner for DB members, showing how much your pension might be worth by the time you retire. These can be found by logging in to your <a data-sf-ec-immutable="" href="https://member.railwayspensions.co.uk/login">myRPS account</a> </li><li>A range of videos in the <a data-sf-ec-immutable="" href="https://member.railwayspensions.co.uk/resources/video-library">video library</a>, covering topics such as planning and saving, tax and your retirement options</li></ul><p>As well as the tools available on this website, you may come across other online sources, including artificial intelligence (AI) tools like ChatGPT or Gemini. While these can be helpful for general guidance, they don’t replace personalised financial advice. AI can make mistakes and may give you information that’s incomplete, out of date or not relevant to your situation, so it shouldn’t be the only source you rely on when making important decisions. <br></p><p>For important financial choices, it’s always worth checking information carefully and considering financial advice from a qualified professional.</p><h3><strong>When to think about getting financial advice for your pension </strong></h3><p>Reasons for consulting a financial adviser can include getting help with:</p><ul><li>General financial planning</li><li>Tax </li><li>Deciding how to take your pension when approaching retirement </li><li>Avoiding pension scams by getting an expert opinion and/or a steer toward reputable services/products</li></ul><p>Getting advice for your pension could also be particularly useful if things in your life have changed, or if you’re considering a change of another kind. </p><p>For example: </p><ul><li>If you are starting a new pension or deciding which pension arrangements to join</li><li>If you are considering whether to transfer your pension</li><li>If you’ve recently received money, such as inheritance, or a lump sum pension pay-out and are unsure what to do with it </li><li>If your personal situation has changed, for example through divorce </li></ul><h3><strong>The benefits of getting financial advice for your pension</strong></h3><p>Getting financial advice usually means having an expert in your corner. For example, someone who can: </p><ul><li>guide you through any difficult decisions relating to your pension and recommend a way forward to suit your needs</li><li>point you towards products and options that will best match your personal circumstances and goals. And in some cases access products you wouldn’t necessarily have found on your own. </li><li>put together a plan and make sure it stays on track over the longer term, even making adjustments with your permission if necessary </li><li>help make sure you’re within the relevant tax allowances and advise on alternatives if you’re reaching them </li><li>look at ways to boost your pension</li></ul><h3><strong style="background-color: rgba(0, 0, 0, 0); color: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">Finding the right financial adviser for your pension</strong></h3><p>It’s important to first understand the different between guidance and advice. They may sound similar, but from a financial perspective there is an important difference. </p><p>Individuals and organisations offering financial guidance can help you understand your options and factors you may wish to consider. However, guidance does not tell you what you should do. Whereas financial advisers can actually recommend which product they think would suit you best.</p><p>Unlike guidance services, financial advisers are regulated by the Financial Conduct Authority (FCA). This means they have to agree to a certain level of standards and you can get additional support through the Financial Ombudsman Service or Financial Services Compensation Scheme if things go wrong.</p><p>Liverpool Victoria (LV)&nbsp;has been chosen as the official partner to give RPS members access to financial advice. </p><p>LV covers all areas of pension advice, including:</p><ul type="disc"></ul><ul><li>retirement</li><li>financial planning</li><li>transfers</li></ul><p>And has a dedicated team, with specific knowledge on the Scheme.</p><p><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">LV can be contacted on 0800 023 4187.</span></p><p><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"></span><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">You are still free to choose your own Independent Financial Advisor (IFA). You can find an IFA in your area at&nbsp;</span> <a style="font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal" data-sf-ec-immutable="" target="_blank" href="https://www.unbiased.co.uk/">unbiased.co.uk</a> </p><p><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">More information about getting help and advice is also available <a href="/pension-essentials/guidance-advice">here</a><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">.&nbsp;</span></span> </p><h3><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"></span><strong style="background-color: rgba(0, 0, 0, 0); color: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">Considering the cost of financial advice</strong></h3><p><strong style="background-color: rgba(0, 0, 0, 0); color: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"></strong><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">Getting financial advice can be expensive.&nbsp;</span></p><p><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"></span><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">Any member who contacts LV will be evaluated for free first, to make sure that only those who truly need advice will progress to the chargeable stage. And even then, LV will offer its services at a discounted rate for RPS members.</span></p><p><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"></span><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">If you chose to find your own independent adviser, then keep in mind that not everyone offers a free introductory session and that their charges and areas of expertise may differ. So it’s best to shop around to find the best fit.</span></p><h3><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"></span><strong style="background-color: rgba(0, 0, 0, 0); color: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">Looking out for scams offering financial advice</strong></h3><p><strong style="background-color: rgba(0, 0, 0, 0); color: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"></strong><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">Scammers sometimes pose as financial advisers, or claim to be offering financial guidance and advice, as a way of getting their hands on your pension.</span></p><p><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"></span><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">You should be particularly cautious if anyone contacts you out of the blue, or offers you a free pension review or no-obligation consultation. </span>Especially if they actively encourage you to transfer your pension or ‘unlock your benefits early before Normal Minimum Pension Age (NMPA), which is currently 55.’</p><p>Also be alert to anyone promising guaranteed returns, high investment growth or overseas investment opportunities. These are also common warning signs of pension scams.</p><p><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"></span><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">Before entering a conversation with anyone, you should check their details against the </span> <a target="_blank" data-sf-marked="" style="font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal" data-sf-ec-immutable="" href="https://register.fca.org.uk/s/">Financial Conduct Authority (FCA) register</a> <span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"> to make sure they are fully regulated and have the FCA’s permission to provide the services they’re claiming to offer.</span> </p><p><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"></span><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">You can also check the FCA’s </span> <a target="_blank" data-sf-marked="" style="font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal" data-sf-ec-immutable="" href="https://www.fca.org.uk/consumers/unauthorised-firms-individuals">warning list</a> <span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"> to see the names of companies who are known to be operating without proper authorisation.</span> </p><p><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto"></span><span style="background-color: rgba(0, 0, 0, 0); color: inherit; font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal; caret-color: auto">You can read more about staying safe from scams </span> <a style="font-family: inherit; font-size: inherit; text-align: inherit; text-transform: inherit; white-space: inherit; word-spacing: normal" data-sf-ec-immutable="" href="https://member.railwayspensions.co.uk/resources/safety-and-scams">here</a> </p>

<div><span style="background-color: initial; font-size: inherit; text-align: inherit; text-transform: inherit; word-spacing: normal; caret-color: auto; white-space: inherit">Now you’re past your 20s, you’re probably more settled and have an idea of how you want to live, what matters most to you and what your priorities are for the foreseeable future.</span></div><div><br></div><div>In your 30s, you may have changed jobs and moved up the career ladder. You could also have a family to care for, childcare costs to pay, holidays to fund and many more financial demands to meet. Understandably, your money may feel stretched, and you may start looking for ways to cut back on your spending. Although a temporary pause on your pension payments may seem like a good way to give your bank account a breather, it’s important to think carefully before you make that decision.</div><div><br></div><div>Here’s why staying focused on your retirement goal and keeping up your saving journey, even during times of financial strain, could be one of the best things you can do for your future and your loved ones.</div><div>&nbsp;</div><h5>You’re not saving alone</h5><div>One of the most valuable benefits of saving for the future with the Railways Pension Scheme (RPS) is the fact that you’re not saving alone. Your employer puts money in too. If you’re a Defined Benefit member, your employer will pay in at least 60% of the money you put in (normally 1.5 times the contribution you make). For example, if you earn £25,000 a year and you pay in £3,000 towards your pension, your employer will top that amount up by £4,500 for free.</div><div><br></div><div>What’s more, you also get support from the government for saving into a workplace pension. This support comes in the form of tax relief on your pension contributions. The money you pay in is taken from your salary before you pay any tax on it, which helps you save more towards your pension.</div><div><br></div><div>So, for a basic-rate taxpayer, every £100 paid into a pension means the full £100 is invested for your future. If that money had been paid as salary instead, you would usually have received only £80 after tax. By saving into your pension, the £20 that would otherwise have been paid in tax is invested for you instead.</div><div><br></div><div>That’s why it’s important you think carefully before making any decisions about reducing or stopping your pension payments, as it could mean missing out on valuable money from your employer and tax relief.</div><div><br></div><div><a data-sf-ec-immutable="" href="https://www.railwayspensions.co.uk/knowledge-hub/news-and-views/blog/rps-blog/2023/04/26/tax-relief-and-tax-allowances-explained">Find out more about tax-free relief here.</a></div><div>&nbsp;</div><h5>Will your State Pension be enough to give you a good life in retirement?</h5><div>As much as we’d like to think of retirement as the golden time of our lives when for once we don’t have to worry about work and have the freedom to travel, take up new hobbies and enjoy life, we know that in reality the lifestyle we have in later life will largely depend on what income or savings we have.&nbsp;</div><div><br></div><div>If you are planning to rely heavily on the State Pension, will it give you the lifestyle you want at retirement? It’s a great supplement to your retirement income, but the current State Pension is around £12,500 a year. Will that be enough? For comparison, someone working 40 hours a week on the National Living Wage would earn around £26,400 a year, a difference of almost £14,000 a year. And, under current legislation, most people will not be able to claim their State Pension until their late 60s.</div><div><br></div><div>If we save towards our future while we are in work, we are much more likely to have the retirement we hope for.</div><div>&nbsp;</div><h5>Don’t interrupt the art of compounding</h5><div>Your pension is invested to give you an income when your working days are over. The longer you keep it invested, the more chance it has to grow. Sometimes, it may benefit not only from investment growth, but also from further growth on that growth. This process is known as compounding, and we explain it in more detail our <a href="/knowledge-hub/news-and-views/blogs/rps-blog/2026/10/19/pension-planning-your-20s---making-the-most-of-a-pension-plan-when-you're-young">‘Pension planning in your 20s’ article</a>.</div><div><br></div><div>Interrupting the investment process by stopping your pension payments would throw a massive spanner in the works. This is because it would affect the compounding that happens while you’re regularly investing into your pension. This on its turn means that you could potentially miss out on significant sums of money in the long run – after 20, 30 years.</div><div><br></div><div>The compounding effect only applies to members who have some or all of their pension money invested such as members of the Industry-Wide Defined Contribution (IWDC) section and members who pay in Additional Voluntary Contributions (AVCs) such as BRASS. Compounding has no impact on Defined Benefit (DB) only members but if you stop paying into your DB pension that will impact what you have to live on when your working days are over. What is more, you may not be able to re-join the DB section in the future.</div><div>&nbsp;</div><h5>Once you’ve stopped paying in, you may not start again</h5><div>Humans are creatures of habit and routine. It can be hard to go back to saving after you’ve had a flavour of having that extra bit of money in your pocket every month.</div><div><br></div><div>And as pointed above, if you leave the RPS, you may not be able to re-join again.</div><div><br></div><div>Think of your pension as one of your last options not your first when looking at where you can cut costs. To help our members think about their broader financial wellness we have introduced a simple planning tool called MoneyFit which you can access when you log into your <a data-sf-ec-immutable="" href="https://member.railwayspensions.co.uk/my-rps">myRPS account</a>.</div><div><br></div><div><a data-sf-ec-immutable="" href="https://www.moneyfit.co.uk/app/railpen">MoneyFit</a> is designed to give you some simple hints and tips to help you manage your money. It’s totally anonymous and takes around 5-10 minutes to use.</div><div>&nbsp;</div><h5>Have a plan! If you don’t have one, make one!</h5><div>By failing to prepare, you are preparing to fail as the saying goes. The same goes for retirement planning.</div><div><br></div><div>Even if you’re left with no other option but to cut back on your pension saving, this may not mean leaving the Scheme completely but pausing your Additional Voluntary Contributions (AVCs) for a little while.</div><div><br></div><div>So as an example, you may choose to pause your £50 monthly BRASS contributions for a while. This might be a good option for you if it means you can stay in the Scheme and can continue to save towards your pension. Or if you feel you have to leave pension saving behind for the time being, it’s always worth getting back to it when you’re more financially stable and can afford to save for later life.</div><div><br></div><div>The important thing is that you plan ahead, understand what you might need in retirement and ensure you are saving enough, without putting your broader financial wellness at risk.</div><div><br></div><div>Leaving the Scheme rather than pausing any extra payments you’re currently making could significantly impact your lifestyle in the future. It means you’ll have less to live on when your working days are over. For some, this also means they won’t be able to afford to retire when they want to and will be pushed to continue to work for longer.</div><div><br></div><div>To get an idea of how much income you might need to enjoy the lifestyle you hope for, give our <a data-sf-ec-immutable="" href="https://www.railwayspensions.co.uk/knowledge-hub/help-and-support/retirement-budgeting-calculator">Retirement Budgeting Calculator</a> a go. It’s a quick and easy tool to help you estimate if you’re saving enough for later life.</div><div><br></div>