The Buzz.

Knowing how much to save for later life is tricky. Retirement can feel like something to think about down the line, especially when you’re young and in the middle of your career.

But, the sooner you start putting a plan together and working out how much you’ll need, the easier it can be to set money aside.

Having an end goal to work towards can give you purpose and direction with your saving.

Plus, you can regularly check in at different life stages to monitor your progress.

So how much do you need to save for retirement?

What you need in your pension each decade

In truth, what you need for retirement depends on your personal circumstances - we’ll come back to this idea at the end.

First, let’s look at what retirement could cost on average. For that, we’ll use Pensions UK’s Retirement Living Standards.

These are an estimate of the average annual cost of retirement, updated each year. It breaks the cost of retirement down into three lifestyles: minimum, moderate, and comfortable.

We’ll base our calculation on a moderate standard of living. That’s a retirement lifestyle which each year includes things like:

• £500 for maintaining your property, and £300 in case of emergencies;
• around £59 a week for groceries, plus £33 a week for food out of the home;
• a three-year-old car, replaced every seven years;
• a fortnight three-star all-inclusive holiday in the Med, plus a UK off-peak staycation; and
• up to £1,500 for clothing and footwear.

They also assume you have no housing costs, such as rent or mortgage payments.

In 2026/27, the figures for how much you need each year for a moderate retirement are:

• £32,700 for individuals; and
• £45,400 for couples - that’s a combined household income between two people.

With these figures in mind, we can then work out that a single person would need total pension savings of £503,825. 

This assumes that you receive the full new State Pension, and retire at State Pension age. In 2026/27, the full new State Pension pays £12,547 a year once you reach State Pension age (66, rising to 67 by 2028).

It’s based on annual withdrawals of 4%, increased by inflation each year. This withdrawal rate historically means your pot’ll last for at least 30 years. However, it’s not a perfect science, and that rate might not be appropriate for everyone.

These calculations also assume no tax, but pension income - including from the State Pension - is potentially taxable. So, you might need more in your pension to achieve this income when taking tax into account.

How much should I have in my pension throughout my career?

With this figure in mind, you can then work backwards. Using the PensionBee Pension Calculator, you can work out what you’d need to have saved throughout your life to reach those targets.

The table below shows you what you’d need to build a pot of that size at 30, 40, 50, and 60 as an individual.

The figures make the following assumptions:

• £350 personal monthly contribution, including tax relief;
• £250 employer monthly contribution;
• 5% annual investment growth;
• 2.5% annual inflation;
• 0.7% in pension fees;
• a retirement age of 67; and
• you don’t take your 25% tax-free lump sum (from 55, rising to 57 from 2028).

Note: total pension savings figures are rounded.

These figures show the power of starting early. If you begin contributing at 30 and keep doing so, you have enough time to set money aside and give it the chance to grow so you can enjoy later life.

They don’t show the impact of increasing contributions, either. As you progress through your career, your earnings might rise. That could allow you to increase how much you pay into your pension too.

Doing so could help you hit your goal sooner. That might allow you to retire earlier, or with more saved than you thought you might have.

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Save for your future with PensionBee

The Retirement Living Standards are a good guide for what you’ll need for later life.

But they’re just that - a guide.

What you’ll need for retirement is actually completely personal to you. It’ll depend on things like:

• when you want to retire;
• what you want to do with your time;
• what sort of lifestyle you’re aiming for; and
• whether you’re single or in a couple.

Putting these elements together, you can work out your own personal number to aim for. Then, you can use tools like the PensionBee Pension Calculator to give you an idea of how much you’d need to save to achieve it.

You can see what impact increasing your contributions would have. You can also add or remove the full new State Pension. So, if you won’t make enough National Insurance contributions, you can take that off your calculation. You need 35 years on your record to receive the full amount.

By working out what you need and what it’d take to get there, you can have the confidence that you’re on track for the retirement you want.

Risk warning

As always with investments, your capital is at risk. Past performance is not an indicator of future performance. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

Over the past few months, we’ve been refreshing your PensionBee account (your ‘BeeHive’) to give you clearer access to your pension information and make managing your retirement savings easier.

Android users may have noticed these changes being progressively rolled out since our February launch. If you're an iOS user, changes will be rolled out shortly, or you can download the latest version of the app. We've rounded up some of the changes so far that have made their way into your BeeHive.

‍What’s new:

‍Plan information

You can now more easily see where and how your pension is invested. Head to ‘My pension’ and tap ‘View plan information’. Here you’ll get a quick look at your plan’s top 10 holdings - the companies that your pension has the largest investments in - as well as the type of assets and the countries your pension invests in.

‍Discover tab

Our blog, video and podcast content can be found under the new ‘Discover’ tab, which you’ll find on your main navigation bar. Here you’ll be able to keep up to date with all of our latest and weekly featured blogs, the Pension Confident Podcast and our Pensions 101 videos. There’s always something new to read, watch or listen to, so be sure to check back regularly.

‍Automatic withdrawals

Our newest way of taking money from your pension lets eligible* customers schedule automatic withdrawals. It saves time and the hassle of making monthly manual withdrawals by having them automatically deposited to your chosen bank account.

‍*you can withdraw from age 55, rising to 57 in 2028.

Dark mode

If you like to use dark mode with your other apps, we’ve now added it as an option within the PensionBee app. If you're not familiar, dark mode is a display setting that uses light-coloured text on a dark background. It’s easier on the eyes in low light, reduces screen glare, and can even help save a little battery life. To enable dark mode, tap the 'Account' icon in the top right corner of your app and then select 'Settings'.

‍Live chat

We've expanded the ways you can access support through our new live chat feature. Live chat lets you get quick answers to your questions without leaving the app. Just tap the icon in the bottom right corner to open it, then type your question and our AI assistant, BeeBot, will respond right away. If BeeBot can't help, simply ask to speak with one of our account managers (BeeKeepers) instead. Past conversations are saved in the 'Messages' tab within the Live chat feature, and you can download transcripts anytime you need them for your records.

Personal rate of return 

Personal rate of return is a new performance metric we’ve added to the 'My pension' tab of your BeeHive. The current simple return compares your current pension balance to the total net amount of money you’ve paid in. However, if you regularly contribute, transfer a pension or withdraw from it, the personal rate of return provides a more accurate picture of pension performance by factoring in the size and timing of those transactions. So you’ll always see a figure that genuinely reflects how your money has grown. This feature is being gradually rolled out, so you may not see it initially.

Read more on our dedicated blog.

‍Account

You can manage your personal information and find account support under the new ‘Account’ tab in the top right corner of your BeeHive. Here you’ll be able to edit your personal details, manage beneficiaries, find your BeeKeeper’s contact information and access our FAQs.

A refreshed look and feel

Whether you manage your pension through our app or online, you’ll get a more consistent experience, including the names of features and menu items. Those menu items are outlined below:

Summary (previously, the ‘Balance’ tab).

This is now split into two parts: ‘Transactions’ and ‘Overview’.

Transactions 

We’ve simplified your pension’s transaction history, showing only the two most recent, with access to your full history available through ‘See all’. Your pension’s transaction history includes contributions, transfers and HMRC and tax top ups made into your pension and any withdrawals from it.

Overview

Your pension’s overview makes it clearer to see how much money has been added to your pension whilst excluding any investment growth.

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My pension (previously, the ‘Analytics’ tab)

See your plan’s performance up front with the performance chart. See simple pounds and percentage figures, making performance over time easy to understand.

Find your plan information, Retirement Planner and switch to a different plan, if preferred, all from here.

‍Actions (previously, the ‘Funds’ tab)

This is where you can contribute to your pension, transfer old ones and track their progress. You can also find your unique PensionBee referral link here. So, you can refer a friend and receive a £100 pension contribution for every friend who opens an account and adds £100 or more to their pension.

‍More to come

Although we’ve completed the rollout of your refreshed BeeHive, we’re continuing to enhance your PensionBee experience with new and improved features coming in the not-too-distant future. You can look forward to enhanced tools, including a new version of your Retirement Planner to help you better plan for and manage life in retirement.

Let us know what you think

We’re always looking for ways to improve your experience as a PensionBee customer. If you have feedback about the changes or any other part of your PensionBee experience, email us at feedback@pensionbee.com.

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For years, millions of couples have lived together. Some of them believe they have the same legal protections as married people. Yet when a relationship ends or a partner dies, many find out the hard way that the so-called ‘common law marriage’ doesn’t exist in the UK.

But this could be about to change.

The government's considering major reforms that would give cohabiting couples in England and Wales greater financial rights. These changes will potentially benefit more than three million unmarried couples. Scotland already has protections for cohabiting couples, albeit limited, under the Family Law (Scotland) Act 2006.

The proposals have been described as the biggest shake-up of family law in a generation. If they become legislation, the rules could transform the legal position of people who’ve built lives, homes and families together without getting married or entering a civil partnership.

For older couples in particular, the changes could be significant. Many people over 50 choose to cohabit, but not marry, after divorce or bereavement. But not everyone understands the impact their relationship status could have on their finances.

The end of the common law marriage myth?

Surveys repeatedly show that many mistakenly think couples have legal rights through long-term cohabitation. This is the case in some other countries - such as Australia and New Zealand - where cohabitees are recognised as being in a “de facto” marriage.

But this doesn’t exist in England and Wales, regardless of how long a couple have lived together.

The legal gap between being married and unmarried is significant. Married couples and civil partners have established rights when it comes to:

• inheritance;
• pensions;
• property; and 
• financial support. 

Whereas cohabiting couples are left to rely on whatever arrangements they’ve put in place themselves.

This reality often comes as a shock when a relationship ends. One person may have spent years raising children, sacrificing career progression, earnings and pension contributions. Despite these contributions, they may find they have little legal claim to financial assets built up during the relationship. In heterosexual relationships, this is more commonly the woman. 

The situation can be even more difficult following a death. Married couples and civil partners can pass unlimited assets to each other tax-free and share their tax allowances. But unmarried couples don’t benefit from this spousal Inheritance Tax (IHT) exemption. Meaning they may face a 40% tax bill on anything over the standard £325,000 IHT allowance (2026/27).

Also, under current ‘intestacy rules’ - which apply when someone passes away without a will - an unmarried partner won’t automatically inherit if their partner dies. Instead assets will be passed on according to the rules of intestacy. This usually means to the closest living relative.

What are the proposed changes?

The reforms would create a new legal framework for qualifying cohabiting couples.

Under proposals put forward by the Law Commission, couples who’ve lived together for three years or more, or who have a child together, could gain the right to apply for ‘financial remedies’ when a relationship ends.

The proposals wouldn’t treat cohabiting couples in the same way as married couples. Instead, they’d provide a more limited system designed to address any financial disadvantage arising from the relationship.

For example, someone who gave up work to care for children, supported a partner's career, or invested money and time into improving a home they didn’t own, could potentially have legal grounds to claim some money. 

The consultation will also explore whether courts should give greater weight to the impact of domestic abuse. That includes controlling or coercive behaviour or economic abuse, when assessing finances for cohabitants.  

Qualifying couples would also gain automatic inheritance rights if their partner died without a will. 

Can couples opt out of automatic inclusion?

Under the proposed rules, couples would be eligible if they’d lived together for at least three years, or had a child together. 

However, those who didn’t want the new rights could opt out.

This could appeal to older couples with children from previous relationships, who may’ve already arranged their finances and inheritance plans.

To ensure both partners are making an informed decision before opting out, the government is considering safeguards. For example, a written agreement, full financial disclosure and independent legal advice. 

Why do the new rules matter to over 50s?

The topic of cohabiting is increasingly relevant to older generations. It’s older people who tend to have built up more wealth over their lifetime.

Some middle-aged couples deliberately choose not to remarry, many because of:

• concerns about inheritance;
• family dynamics;
• pensions; or 
• protecting assets for children from previous relationships.

However, if a home is in one partner’s name, and that person dies without a will, the surviving partner has no rights. This includes being able to inherit the property or to continue to live in it. Instead, the estate usually passes to children or other relatives, potentially making the surviving partner homeless.

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What should cohabiting couples do now?

Any legislation is unlikely to become law until 2028 at the earliest. Until then, if you’re cohabiting, consider taking your own steps to protect your financial future.

• Make a will - this is the most important step. Writing a will gives you the opportunity to set out who your estate should be left to or divided between.
• Keep pension beneficiaries up to date - pension benefits don’t always automatically pass to an unmarried partner. Check that your chosen beneficiary details are up to date. PensionBee customers can do this in their online account (‘BeeHive’).
• Consider a cohabitation agreement - this legal document sets out what happens to property, savings and other assets if the relationship ends. It could help you avoid disputes later on. 
• Review how your home is owned - the way a property is registered can affect what happens if one partner dies. If you're unsure whether you own as joint tenants or tenants in common, seek legal advice. 
• Seek advice if a relationship breaks down - even under the current rules, some financial protections may be available. In particular, where children are involved.

What happens next?

No final decisions have been made yet. And any changes would require legislation to pass through parliament before becoming law.

If you want to have your say, visit the Ministry of Justice website and take part in the consultation before 14 August 2026.

Want to find out more about whether getting married is financially worthwhile? Listen to episode 52 of The Pension Confident Podcast, where our expert guests discuss the benefits and downsides of getting married for your purse strings.

You can also read the full transcript of the conversation.

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Emma Lunn is a multi-award winning Freelance Journalist. She’s written about personal finance for 20 years, with a career spanning several recessions and their consequences. Her work has appeared in The Guardian, The Telegraph and MoneyWeek. Emma enjoys helping people learn to manage their money well, in both the short and long term.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice. 

Please note that tax rules change regularly, and the actual tax benefits you receive will depend on your individual circumstances. If you’re not sure, please seek professional advice. 

The following is a transcript of a bonus podcast episode of The Pension Confident Podcast. Listen to the episode or scroll to read the conversation.

‍

Takeaways from this episode

• Fewer couples are choosing to get married - fewer than half of all UK adults are married or in a civil partnership, while the number of cohabiting couples has increased by about 140% between 1996 and 2021.
• The ‘common law marriage’ myth - around 46% of people in the UK mistakenly believe common law marriage exists.
• Marriage still carries real tax advantages - assets, including property, can pass between spouses free of Inheritance Tax.
• Adults aren’t preparing for the worst - around 47% of people in the UK don’t have a will, leaving unmarried partners especially exposed.

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PHILIPPA LAMB: Hi! Will you marry me? It’s a question most people answer with their heart, not their head. But should they? For the first time ever, fewer than half of all UK adults are married or in a civil partnership. Cohabiting is a completely normal part of modern life. The problem is the law hasn’t kept pace with it, and the financial and legal gap between married and unmarried couples is way bigger than most people realise. So, the question we’re asking is: legally and financially, is it worth getting married?

With me today, another Philippa! Philippa Dolan, a Solicitor and Partner at Collyer Bristow. She’s also Co-Host of their legal podcast, LawTorn. Philippa has spent decades advising clients about prenups, divorce, and custody cases. Mike Donkor’s here with us too. He’s a former Stockbroker turned Financial Planner. He provides regulated advice to help individuals and couples simplify complex financial decisions around issues like Employee Share Schemes [and] Inheritance Tax (IHT). And from PensionBee this time, we’re joined by Chief Marketing Officer, Jasper Martens. He’s been with PensionBee since, what, almost the very beginning?

JASPER: The beginning, yeah.

PHILIPPA LAMB: And it’s not your first time on the podcast.

JASPER: It isn’t.

PHILIPPA LAMB: Welcome everyone.

MIKE: Welcome, welcome.

PHILIPPA LAMB: Thanks for coming in.

MIKE: Thanks for having us.

JASPER: Thank you.

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Why marriage rates are falling

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PHILIPPA LAMB: Now look, I’ve got a question for all of you. Assuming you find someone that you want to spend the rest of your life with, do you personally think marriage is the way to go? Philippa? 

PHILIPPA DOLAN: It’s hard to generalise. Sorry, I’m a lawyer.

PHILIPPA LAMB: She’s equivocating right out of the gate.

PHILIPPA DOLAN: I am, yes.

PHILIPPA LAMB: For you then?

PHILIPPA DOLAN: I got married to someone I’m still very friendly with. We had two children. We got divorced after a few years. I did the divorce. It was all fine.

PHILIPPA LAMB: DIY divorce.

PHILIPPA DOLAN: I totally trusted my then husband.

PHILIPPA LAMB: Did you marry again?

PHILIPPA DOLAN: I did marry again.

PHILIPPA LAMB: How did you two meet?

PHILIPPA DOLAN: He came to see me as a client, because he was getting divorced and we fell in love.

PHILIPPA LAMB: OK.

JASPER: Sounds like a rom-com.

MIKE: Sounds like an episode of Suits.

PHILIPPA LAMB: I don’t know if that’s romantic or not. But it’s handy -

PHILIPPA DOLAN: yeah, yeah -

PHILIPPA LAMB: wow -

PHILIPPA DOLAN: who I’ve been married to for many years.

PHILIPPA LAMB: Mike, how about you?

MIKE: I’ve been married about 11 years now.

PHILIPPA LAMB: And was it always going to be marriage?

MIKE: So yeah, I never really over-thought about it. It was just, “OK, we’re together, we’re gonna have kids, and then we’re gonna get married”. And that was the process with me. Yeah.

PHILIPPA LAMB: And that’s what happened.

MIKE: Yeah.

PHILIPPA LAMB: For the record, I’m married, second marriage, like Philippa. So, fair to say I’m quite positive about it myself. Which brings me to Jasper.

JASPER: Well, I’m not married myself, but I’ve been together with my partner for 18 years, so you can consider that to be quite a long-term engagement - 

PHILIPPA LAMB: yeah, long relationship -

JASPER: yes, long relationship, and I think I’ve never been too keen on it.

PHILIPPA LAMB: Tell me why.

JASPER: A couple of reasons. First of all, quite a lot of people around me got divorced, quite early on in the process. And second, I’m gay, and in not many countries marriage was an option on the table. And my age hopefully doesn’t show too much, but from the Netherlands it was always possible, where I’m from originally. But I’d say in other countries it wasn’t always an option. Here in the UK only, I don’t know when it was actually legalised or when it was possible.

PHILIPPA LAMB: I think that came in 2014.

JASPER: So, there were two reasons for it really. I see a lot of marriages fail.

PHILIPPA LAMB: Yeah.

JASPER: And I just want to keep it nice and clean if the time ever comes that me and my partner are no longer together. But we’ve been going for 18 years and we’re quite happy.

PHILIPPA LAMB: What you say is right. Not all marriages go well. Mike, marriage is declining anyway, isn’t it?

MIKE: Yeah. 42% of marriages end in divorce. Naturally, we’re seeing an increase of cohabitants in the UK as well. It’s about 3.5 million people. It’s increased by about 140% [from 1996 to 2021]. And we’re seeing a lot more kids being born from unmarried couples as well.

PHILIPPA LAMB: Philippa, there’s this term, isn’t there, that people throw around a lot, ‘common law marriage’.

PHILIPPA DOLAN: Yes.

PHILIPPA LAMB: So, is that a thing?

PHILIPPA DOLAN: No.

PHILIPPA LAMB: So -

PHILIPPA DOLAN: absolutely not.

PHILIPPA LAMB: And it doesn’t matter how long you’ve been together?

PHILIPPA DOLAN: Doesn’t matter. None of that counts. You can be together for 60 years.

PHILIPPA LAMB: Doesn’t matter if you’ve got kids? Doesn’t matter if you own property together?

PHILIPPA DOLAN: They make a difference, clearly, because you’ve got a claim if you’ve got property with someone and children are separate. Children do have claims, but they’re -

PHILIPPA LAMB: but if you’re not married, in any way -

PHILIPPA DOLAN: the children’s claims. They’re not the parents’ claims, and the parents have no rights.

PHILIPPA LAMB: I do wonder how many people actually know that.

MIKE: I don’t think a lot of people know. I think it’s quite low. In the UK, around 46% of people believe that common law marriages exist, and it doesn’t. So, people are cohabiting together and assuming that the government or the law is protecting them in one way, shape, or form when it actually isn’t.

PHILIPPA LAMB: That’s a big problem, isn’t it? We’ll get into the why of that in due course, but it’s fascinating to hear. Essentially, should we just nail down civil partnership as well, Philippa? Because obviously, not everyone marries, but people do have civil partnerships. Are your rights the same?

PHILIPPA DOLAN: Exactly.

PHILIPPA LAMB: OK.

PHILIPPA DOLAN: Absolutely the same.

PHILIPPA LAMB: But, Jasper, you haven’t done either?

JASPER: No, we haven’t done either. So, we’re together, we’re cohabiting, I’d say, and we’ll probably get later into it, but certain things that are common, like our house, we’ve got that sorted. You have to make sure that those things - what happens if we’re separating, or even one of us passes away? What happens to the house? I think you need to take care of those things. But there are other ways to do it rather than going into either a civil partnership or getting married.

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The financial perks of marriage

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PHILIPPA LAMB: OK, well, I don’t want to persuade you to [do] anything different, but I’m going to ask Mike -

MIKE: yeah -

PHILIPPA LAMB: to talk about actual financial benefits -

JASPER: yes -

PHILIPPA LAMB: of being married. Are there any?

MIKE: Well, yeah, there’s loads.

PHILIPPA LAMB: Go on then, tell us.

MIKE: There’s loads. Ultimately, I always say to clients when I’m speaking to them about this stuff, “What’s important for you, and the people that you care about, if you weren’t here?” And I think when you start to answer that question, then the question of marriage starts to become a bit more attractive in some circumstances.

The idea of marriage is essentially, I guess, from a legal, financial perspective, is more of an automatic framework of what could happen in the event of something later on. And that can save a lot of time, a lot of hassle, maybe a lot of cost as well. So, if I was to touch on one thing, for example, Inheritance Tax (IHT) - Jasper was talking about property - if you’re married and something [were] to happen to one of the spouses, your property could automatically be transferred to your surviving spouse -

PHILIPPA LAMB: without Inheritance Tax? -

MIKE: without Inheritance Tax.

PHILIPPA LAMB: That’s a key difference, isn’t it?

MIKE: It’s quite powerful.

PHILIPPA LAMB: That could be a lot of money.

MIKE: Yeah, definitely. If you think about London, the average house price is around £550,000, probably upwards of that. We start thinking about Inheritance Tax, those numbers can just keep going up and up and up without you even doing anything, just by sitting in the property.

PHILIPPA LAMB: It’s quite a compelling thought, isn’t it, Jasper?

JASPER: Mm-hmm. Mm-hmm. Yes.

PHILIPPA LAMB: Just got to lay that out there.

MIKE: Jasper’s intrigued!

JASPER: I think the Inheritance Tax isn’t something I would’ve thought about per se. For me, it was more about - and this sounds awful to say because we’re very happy together - but it was more from a point of view, I meant, what if we decide to move, split up? Like, what would happen? We just take each other’s share of the house. And that’s it really. But what if one [of you] passes away and if you’re not married or in a civil partnership, Inheritance Tax might be on the table versus not on the table. So, I think that’s definitely a consideration.

PHILIPPA LAMB: We’re going to talk more about what happens if someone unfortunately dies a bit later on, but are there other tax benefits we should be thinking about?

MIKE: Well, yeah, Capital Gains Tax (CGT).

PHILIPPA LAMB: Right. So how does that work? 

MIKE: So, if you’re an owner of property or shares, [or] some investment, you could effectively transfer some of those assets, or that equity, to your spouse at no Capital Gains Tax. I guess one of the key benefits there is you’re now in a position where it’s not just one allowance that you can maximise, because everyone has a Capital Gains [tax-free] allowance of £3,000 a year (2026/2027). So effectively you could split that share, provide it to your partner, and they can also use their allowance if they were to sell those shares as well.

PHILIPPA LAMB: Am I right, maybe there used to be something around Income Tax as well for married couples?

MIKE: So, if one of the spouses isn’t earning and the other one’s a basic taxpayer, then they could still transfer the Marriage Allowance, about £1,260 [of your Personal Allowance] (2026/2027), something along those lines.

PHILIPPA LAMB: OK, so there’s a marginal gain there. That’s worth thinking about.

MIKE: You can save [in tax up to £252] or so (2026/2027). Obviously [it’s] dependent on the circumstances, but there’s something there.

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When unmarried couples split

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PHILIPPA LAMB: It would be useful, Philippa, to talk about what happens to an unmarried couple’s finances when they split. If you’re just living together, cohabiting, no agreement, no nothing, what happens to all the stuff? However long you’ve been together, what happens to all the things you’ve built?

PHILIPPA DOLAN: Well, it’s like two people living together, that’s all it is. They could be flatmates, so whoever owns what, they own it. And you might have an argument over the sofa if you went out and bought it together, but probably you own half each.

PHILIPPA LAMB: OK, so here’s a common scenario. It certainly was in the past, I think still is. Girlfriend moves into boyfriend’s flat or house. They end up staying together for years. She’s paying other bills, maybe he’s paying the mortgage, maybe she’s contributing, but it’s off the books. They’re sharing their household finances, but he still owns the house. So, they’re together 20 years. At the end, the house is his outright, is it?

PHILIPPA DOLAN: It really depends [on] what she’s been contributing.

PHILIPPA LAMB: Would she have to prove it?

PHILIPPA DOLAN: If he doesn’t agree, yes. The messiest of litigation.

JASPER: That’s very messy.

PHILIPPA LAMB: That’s the thing, isn’t it? In those relationships, you don’t keep notes, do you? You just pay bills.

MIKE: No one’s tracking who bought the vacuum, who paid for the cooker, unless you’ve got a spreadsheet like me, you know.

PHILIPPA DOLAN: So certainly, if the property’s the main asset, then if it’s in one person’s name, you’re a bit stuffed if you’re the other person. You can run arguments about, “Well, I did pay the mortgage, say”, which would give you some claim -

PHILIPPA LAMB: or some other household bill in lieu of the mortgage?

PHILIPPA DOLAN: Depends on the bill, really. It needs to be tied to the house.

PHILIPPA LAMB: So, say you were paying utility bills, maybe you’re paying for a cleaner, would that do it?

PHILIPPA DOLAN: No.

MIKE: No.

PHILIPPA LAMB: Or the Council Tax?

PHILIPPA DOLAN: No, a cleaner wouldn’t do it.

PHILIPPA LAMB: No. So that’s really worth thinking about for people living in someone - in a property which isn’t in their name.

PHILIPPA DOLAN: Yeah, yeah.

PHILIPPA LAMB: A very significant issue. Does it matter if you have children together in that situation?

PHILIPPA DOLAN: Completely different in that the children have claims. That - so the parent who’s the one who’s lost out on the deal, she (as it probably is) can make claims on behalf of the children - 

PHILIPPA LAMB: for maintenance? -

PHILIPPA DOLAN: for maintenance, but also for things like, “Oh, he’s great at the piano, I want him to go and spend three weeks in Germany this summer”. And if the money’s there in the relationship or in the - with the other person, then you can claim lump sums. You can also claim to stay in the house on behalf of the children until they’re adults, because of their accommodation needs. But it’s very complicated and not straightforward at all.

PHILIPPA LAMB: OK, so Jasper, have [you] and your partner talked about that sort of thing?

JASPER: Yeah, for me it was always explained. So, when we moved to London, he owned the apartment outright. He was basically my landlord. I think that’s probably the best way to describe it, and that’s how you need to see it. We sold that apartment two and a half years later and bought a property together. And then from that moment onwards, of course, things will have changed. I think it’s - you should never consider, even if you contribute like, how are you going to prove that? It’s going to be incredibly messy -

MIKE: really, really hard -

JASPER: and you just need to consider it like you’re paying your partner rent. Yeah, I think that’s the best way to describe it.

MIKE: You say that, but people aren’t always thinking about it from that perspective because, back in the day there used to be one breadwinner of the household. And if that person - maybe it was the man of the house that was “bringing in the bacon”, as they say, and the income - and maybe the wife was taking care of the children, then she may not -

PHILIPPA LAMB: or the girlfriend -

MIKE: or the girlfriend in this case - then she may not have all of the financials to feel like she’s contributing to justify the beneficial interest of the household, effectively.

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Avoiding the money conversation

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PHILIPPA LAMB: As we all know, if there’s kids, someone certainly initially is staying at home to look after them and maybe cutting down their work or not working altogether, possibly for very long periods of time. So, then you do get that financial inequality, and it is, yes, mostly even now still women, isn’t it? So, this is definitely something to think about. Do you often see, Mike, people with whom they’ve shared a home for years and they don’t have anything in writing?

MIKE: Yeah.

PHILIPPA LAMB: You do?

MIKE: Yeah. It happens a lot.

PHILIPPA LAMB: Wow.

MIKE: Even if you think about wills in general, I think about 47% of people don’t have wills, still.

PHILIPPA LAMB: Yeah.

JASPER: It all comes down to it’s one of those things that a lot of people just don’t understand well.

MIKE: Yeah.

JASPER: And they’re putting it off.

MIKE: Yes.

JASPER: And time goes really fast and it’s the same with other financial things. And being a marketeer in pensions, I can feel the pain, because it’s one of those things you’ll put off.

MIKE: Yeah.

JASPER: You do that on a Sunday afternoon when it’s raining. “Let’s just look at that will. Let’s look at our situation. Let’s have that conversation”. But you’ll be watching Netflix instead, I think. And that’s the problem. That you need to fight that inertia kicking in and take control and talk to you (Mike) and you (Philippa) about what are my circumstances like? Because time flies.

PHILIPPA LAMB: And with marriage, of course, we’re here we’re talking about legalities and money. This is a romantic relationship. There’s trust there, right? So, Philippa, tell me, but I’m guessing that that’s the thing that stops otherwise perfectly rational people thinking about this in a way that they might otherwise do - if it was a business relationship, for example.

PHILIPPA DOLAN: You mean they don’t want to suggest that there may come a time when the other person’s going to behave badly?

PHILIPPA LAMB: Yeah, well, it doesn’t occur to them, they’re in love. We’ve all been there.

PHILIPPA DOLAN: Jasper, you were saying you didn’t want things to go wrong if you split up from your partner, but of course it doesn’t have to go wrong.

JASPER: Yeah.

PHILIPPA DOLAN: For a lot of people, they’re really decent.

JASPER: Yeah.

PHILIPPA DOLAN: And they’re fair. And actually, whether you’re married or unmarried, we tend to know about the minority of people who behave badly for whatever reason - rage, jealousy, mental health, whatever it is. But a lot of people don’t behave badly. So, the benefits, I suppose, of getting married, other than the fact that I think it’s a lovely romantic gesture, it’s going to be tax isn’t it really?

MIKE: Yeah, it’s going to be tax. Jasper, you mentioned it earlier, a lot of people just don’t know. A lot of people are not looking into this. A lot of people are delaying [their] actions. It’s very easy to just kick the can down the road.

JASPER: You talked about marriage being almost like a template.

MIKE: Yeah.

JASPER: If you get married, you get a set of circumstances and rule sets. Even if you’re not very much in the know, it gives you a framework, safety net.

MIKE: Yeah.

JASPER: But I still believe that beyond that framework or the template -

MIKE: yes -

JASPER: you’ve got to switch your mind on when it comes to these things. Sometimes marriage might not be adequate if there’s wealth involved on both sides, for example. So, I do think people need to keep thinking and don’t rely on it too much.

PHILIPPA LAMB: And also, it’s that nice feeling you get, and I really, this is what drives me to get financial stuff done. It feels so good when you’ve done it.

MIKE: Yeah.

PHILIPPA LAMB: Doesn’t it? It feels so, “OK, job done”.

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How pensions are shared

‍

PHILIPPA LAMB: I want to ask about pensions because we’ve talked about property, we’ve talked about kids. Pensions are often a huge asset in a relationship, aren’t they?

JASPER: Yeah.

PHILIPPA LAMB: And if the relationship ends, how the pensions are divided. Do you have any arrangement?

JASPER: Yes, we do.

PHILIPPA LAMB: Impressive.

JASPER: And he’s not getting everything, and I’m not getting anything from his side either -

PHILIPPA LAMB: OK -

JASPER: If one of us passes away, we’ve looked at our retirement planning. I work for a pension firm -

PHILIPPA LAMB: of course -

JASPER: If I [hadn’t] have done that, then it would’ve been a huge scandal. Yeah. So, we’ve looked at our retirement planning, so we know our number, and it means that in my circumstances, some of it’ll go to my nephews, going past my sister, but to the nephews -

PHILIPPA LAMB: that’s for another podcast -

MIKE: we’ll talk about it later -

JASPER: that’s for another podcast -

MIKE: we’ll talk about it later -

JASPER: no, no, no -

MIKE: what did she do?

JASPER: We talked about it and we talked about it. For me, the most important thing was if anything happened to us, “Can I stay in my house? Can he stay in the house?”. Second is, are you financially - [have] you got your number to sustain yourself well and comfortably until the end of your life? The answer is yes. Then other than the romantic reasons, we couldn’t come up with reasons to get married.

PHILIPPA LAMB: I want to ask Philippa about this though, because pensions, as I’ve said, it’s often a huge asset in a relationship. And much like paying a mortgage, paying into a pension can be leveraged and enabled by another partner paying for other stuff. So, it’s not quite as simple as, “Yeah, well, I paid into it, so it’s mine”. If you’re unmarried and you split up, what happens if there’s a big pension pot in the relationship?

PHILIPPA DOLAN: You have no claim.

PHILIPPA LAMB: You’ve got no claim on it.

PHILIPPA DOLAN: You have no claim. And also, if it’s a pension that’s not a private pension, but it’s a -

PHILIPPA LAMB: a workplace pension -

PHILIPPA DOLAN: I think they’ve changed the rules to some extent for unmarried couples. There were cases in the last few years, but as a general rule, you’ll just lose the pension completely.

PHILIPPA LAMB: Really?

PHILIPPA DOLAN: Yeah.

PHILIPPA LAMB: So, Philippa, you can put arrangements, legal arrangements, in place in advance of all this, can’t you, against that possibility happening?

PHILIPPA DOLAN: Pension Sharing Order (PSO), you can, but only if you’re getting divorced and that’s something the court has to approve.

PHILIPPA LAMB: You can’t have that if you’re not married in the first place?

PHILIPPA DOLAN: No. 

MIKE: OK, that’s on the other side.

PHILIPPA LAMB: That’s another point well worth thinking about, particularly I’d say for later life couples or high income couples who’ve got these pension pots can be very substantial. That’s a big asset to walk away from.

JASPER: And I think it’s a really important thing to bear in mind, especially if one partner has a much smaller pension than the other, then I think it becomes a really unfair situation if the person that passes away or you’re getting a divorce has the bigger pot, then the other is literally left with nothing. And we see that quite often at PensionBee.

PHILIPPA DOLAN: But if you’re getting divorced, you’ll have an equality, probably, what the pensions are worth. So, it’s a reason for getting married, a financial reason.

PHILIPPA LAMB: So, I think what we’re saying here is this is something that definitely needs thinking about. Married, unmarried, whatever. If you’re in a relationship, there are pensions involved, have a think about that. It’s not unromantic, it’s just rational.

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Who gets the pets?

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PHILIPPA LAMB: Talking of sharing assets, and it’s very different to pensions, but I want to ask about pets. Because…

MIKE: I was thinking about that.

JASPER: Don’t split those in half.

PHILIPPA LAMB: This is a thing, isn’t it, that’s cropping up in legal disputes quite a lot at the moment. Is there, Philippa, firstly, a difference if you’re married or unmarried on the ownership of your communal pets?

PHILIPPA DOLAN: No, but I can say there’s no difference if you’re married or unmarried.

PHILIPPA LAMB: OK.

PHILIPPA DOLAN: And they’re still, I think, treated as ‘chattel’, so they’re still treated as objects.

PHILIPPA LAMB: So how do the pets -

JASPER: Like a sofa.

PHILIPPA LAMB: How do they get divvied up?

MIKE: You put the pet in the middle, and the parents stand on both sides, and you wait to see which -

JASPER: So, you literally have to have a bickering around who’s getting the sofa, who’s getting the dog.

PHILIPPA DOLAN: Yeah, and obviously if you’re a vengeful, angry person and you know the other person really loves the dog -

PHILIPPA LAMB: wants the dog -

PHILIPPA DOLAN: then it’s quite a good weapon to employ.

JASPER: Wow.

PHILIPPA LAMB: Have you seen people go to court for their -

PHILIPPA DOLAN: Yes, they do. Yeah.

PHILIPPA LAMB: And how does the court decide who the dog should go to?

PHILIPPA DOLAN: I think it’s complicated. It’s not really a - it’s not a family case, it’s a civil case. But I think that the judge will use their common sense, look at the people in front of them, work out who paid for the dog, who pays for the vet bills, who takes them for walks the most, who’s at home with them the most -

PHILIPPA LAMB: well, these things are worth thinking about. I’m wondering whether there shouldn’t be some arrangements -

MIKE: keep your receipts -

PHILIPPA LAMB: put in place -

JASPER: keep the receipts -

PHILIPPA LAMB: Can you have shared custody of your pet?

PHILIPPA DOLAN: Yes, you can have shared, but I don’t - I haven’t seen it written into an order, but certainly a lot of people do have shared arrangements.

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Protecting your partner with a will

‍

PHILIPPA LAMB: So now we have talked about this sad situation where one partner dies and protecting yourself in that situation, because as you said Mike, I think it’s not even half of adults in this country have a will now. So, there are big implications there. But I’m wondering, Philippa, if setting aside the question of married, not married, does a will - obviously this doesn’t cope with the end of a relationship if you decide to split, but if you stay together, someone dies, and you have wills, are you covered whether you’re married or you’re not?

PHILIPPA DOLAN: Yes, yes, not for tax, but certainly for who you’re leaving your estate to. Yes, it’d be a very sensible thing to do if you didn’t want to get married, but you love the person you live with and you wouldn’t want to see them on the streets if you died. Certainly, you should make them a beneficiary of your will.

PHILIPPA LAMB: But Mike, I’m guessing, lots of people you deal with don’t do that. And tax-wise, as you’ve said, it’s not as advantageous, right?

MIKE: If you’re not married. Yeah, definitely. I think you have to be very careful about the consequences of that. And this is where the planning comes into place because it’s only at that point that people start to really identify what’s important to them and what they actually want to hold onto. A lot of the time I’m speaking to people about property being passed on to their siblings, spouses from a previous relationship, stuff like that, and having to find out at the end that it’s not what they originally thought it was going to be, because they haven’t put those structures in place.

PHILIPPA LAMB: Philippa, if you hadn’t got married and you just decided you were going to cohabit with your partner, what legal arrangements would you have put in place to do that?

PHILIPPA DOLAN: None, I imagine.

PHILIPPA LAMB: Really? You’re a lawyer!

PHILIPPA DOLAN: I know. It’s a cobbler’s shoes, isn’t it? I haven’t got a pension. I’m the worst person.

MIKE: We’re going to have a chat, Philippa.

PHILIPPA LAMB: Yeah, I think that’s absolutely right. Everyone’s shocked, very, very shocked.

PHILIPPA DOLAN: But I probably wouldn’t. obviously, what you should do is make sure that they’re on the title, investigate pensions. Anything else, any other property you’ve got -

PHILIPPA LAMB: pets? -

PHILIPPA DOLAN: yeah.

JASPER: I think if you decide not to get married and you live together for a long time, I think for me, I always compare it to - it’s almost like a self-invested relationship instead of a Self-Invested Personal Pension (SIPP). Like it’s a ‘do-it-yourself’ arrangement. You really have to think about the details, like, “OK, so what do we do with the house? What do we do with the pensions?”. Like you’ve just mentioned, you’ve got to do the work though. If you’re not doing anything, you see many of those as your clients, you’ll be left in tears.

MIKE: Yeah.

JASPER: So, you’ll have to do the work. I think the argument for marriage, if you - aside from the romantic side of things, is it does give you that template, so things will get sorted. But if you’re not getting married, it’s like it’s a self-invested relationship.

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Cohabitation Agreements and annual reviews

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PHILIPPA LAMB: Can you have a prenup if you’re not married? A version of a prenup as it were.

PHILIPPA DOLAN: Well, yes, you can. You can have a Cohabitation Agreement.

PHILIPPA LAMB: So, is that what people should be doing then?

PHILIPPA DOLAN: The property and the pensions are probably the main issues, but some people do, and you can put all sorts of things in them.

PHILIPPA LAMB: Lay out proper rational -

PHILIPPA DOLAN: Yeah, who’s going to take out - who gets what, the rubbish, who’s going to take the dog for a walk whenever, who’s going to - you can put it in agreement. It probably does help. Personally, I couldn’t be arsed, but it probably would help if you had -

PHILIPPA LAMB: do you really want to use that phrase? -

MIKE: that’s exactly the problem -

JASPER: “I couldn’t be arsed” -

MIKE: “I couldn’t be arsed”. For most people.

PHILIPPA DOLAN: But maybe I can imagine, I know some people who probably would benefit from that, and they’d stick to the rules, and it’d make their relationship more relaxed.

PHILIPPA LAMB: But Jasper, you don’t have one of those, Jasper.

JASPER: No, we don’t. And I think the only thing I’d say is what we do on an annual basis, we made the agreement on an annual basis to just revisit some of the things we said we were going to do. I couldn’t - we bought the house in 2012. Give you an example. I’ve been building up my pension since I moved to London in 2009. Guess what? My nephews were born and they’re six and 11. So guess what? You got to, “Where does the money go when I pass away?”. You got to change. You got to tweak. Maybe not every year but make it a habit every year. Use that rainy Sunday afternoon and actually look at it again. Because if you’re not getting married, you’ve set up the rules yourself. So, you also make sure that you have to stick to those rules or you have to make changes.

PHILIPPA LAMB: So, do you do that with your partner?

JASPER: Every year we’ll have a conversation - “OK, what do you think?”. 

PHILIPPA LAMB: You do?

PHILIPPA DOLAN: Is he equally keen?

JASPER: Yeah.

PHILIPPA DOLAN: Is one of you more proactive than the other?

JASPER: He was always more keen than I was. But I’ve been on a journey. And I’ve seen the light. I think it’s really important that you love each other, so you also look after each other.

PHILIPPA LAMB: Yeah.

JASPER: And therefore, review it on a regular basis because things can change. Over time our incomes will have changed. We look at each other’s wealth. It’s like, “What does everybody - and are you OK? Are you comfortable?”. These -

PHILIPPA LAMB: who’s paying for what? -

JASPER: yeah. And this isn’t about - this isn’t romantic - this isn’t killing any romantic relationship. These are reasonable questions you need to ask yourself.

MIKE: I think the problem is people focus too much on the actual paperwork and not the intentions behind it.

JASPER: Yeah.

MIKE: What’s important to you? A financial plan isn’t a piece of paper, it’s an evolving plan. So, as your situation changes, so should your plan. I think sometimes people are worried too much [about] the contractual agreement as opposed to if somebody was to pass away, “What does that actually look like for your kids? What does that look like for your partner?”.

PHILIPPA LAMB: Or even just the relationship comes to an end.

JASPER: Yeah.

PHILIPPA LAMB: Because that’s what, that’s what thankfully normally happens in relationship breakup. It’s before, it’s earlier in life and people just go their separate ways. But you still got all this stuff to untangle, haven’t you? And Philippa and I know, both know about this from having gone through divorce. It’s complicated and we were married. If we hadn’t been, it would’ve been more complicated, wouldn’t it?

PHILIPPA DOLAN: Yes, I think that’s right. It’s more to talk about anyway.

PHILIPPA LAMB: Yeah, because I think we do hesitate. I think it feels unromantic. Maybe it feels a bit confronting, as you say. Maybe the guy’s not going to feel so great about you raising it. Maybe it’ll feel like an accusation. And all these things play into you don’t have the conversation. And if you’re unmarried -

PHILIPPA DOLAN: Your idea is a really good one, Jasper’s idea - 

PHILIPPA LAMB: the annual chat - 

PHILIPPA DOLAN: about having an annual chat, because [of] the trouble with talking about those issues out of the blue, it’s going to raise suspicions, never mind anything else.

PHILIPPA LAMB: Why is she asking? Yeah, why is he asking?

JASPER: It’s in our calendar.

MIKE: Like an annual review?

JASPER: Yeah, in December.

MIKE: With the Financial Advisor.

JASPER: I think it sounds very unromantic. It sounds almost like a business meeting. But I think if you’re living together without any arrangements in place, I think that’s the least you should expect, without raising any suspicions. But it’s like, “Has anything changed?”. I think that should be [a] staple in anybody’s cohabiting relationship.

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A fairer end to relationships

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PHILIPPA LAMB: I should say, Philippa, this is a particularly key time for us to be talking about this, because there’s been a consultation, hasn’t there, about how to end relationships in a fairer way [legally]. Tell us a bit about that.

PHILIPPA DOLAN: Well, it’s quite a bit of a mishmash, actually, because they put together cohabitation rights, which I think everyone, or nearly everyone, agrees is a good idea. They’ve also raised the idea that prenups and - prenuptial agreements and postnuptial agreements, called Qualifying Nuptial Agreements, are going to be - at the moment it’s quite discretionary - I say that, [but] if you tick certain boxes, chances are that the court will uphold the agreement, right? But the judge retains discretion even still.

So, I think the idea is they’re going to be set in stone so that if you again tick the boxes, then your prenup or post-nup will be recognised and upheld. And there’s also stuff about - the other one was having more codification of the financial rules, insofar as there are rules, governing divorce so that there’ll be more certainty because we have, in this country, we’re very - it’s a bit of a gamble quite often if you’re getting divorced. It’s not clear in the way that lots of countries have a more codified approach.

PHILIPPA LAMB: So, the plan is more clarity, more certainty around money in relationships. This is married or unmarried?

PHILIPPA DOLAN: This is both, actually. 

PHILIPPA LAMB: Really helpful.

PHILIPPA DOLAN: It’s to cover everything, and it sort of falls in and out of domestic abuse, but I’m not entirely sure why. And the one thing it doesn’t mention is how can you afford legal advice. And of course, because Legal Aid’s disappeared almost entirely, people can’t get legal advice any longer if they don’t have the money.

PHILIPPA LAMB: That’s a point well made -

MIKE: that’s a very good point -

PHILIPPA LAMB: if you end up legally wrangling with your partner who you’re not married to, the person with the deepest pockets is probably going to come out on top.

PHILIPPA DOLAN: Oh absolutely.

JASPER: Absolutely.

PHILIPPA LAMB: Yeah. Another thing to think about.

MIKE: Another reason to get married!

PHILIPPA LAMB: This is why we have this podcast, to chew over the pros and cons.

JASPER: Well, you’ve heard it here first.

MIKE: You’ve heard it here first.

PHILIPPA LAMB: I think it’s been very interesting. Thank you all very much indeed.

JASPER: Been a pleasure.

MIKE: Yes, it’s been great.

PHILIPPA LAMB: We’ll be taking a short break in August, but we’ll be releasing a special bonus episode with our Series Producer, Lucy Greenwell, looking back on the best bits from our Series 5 so far. Just a reminder, anything discussed on the podcast shouldn’t be regarded as financial advice or as legal advice, and when investing, your capital is at risk. Thanks for being with us. We’ll see you next time.

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Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

With former Manchester Mayor, Andy Burnham, becoming Prime Minister, you might’ve heard about how the bond markets have reacted.

The government relies on borrowing through bonds. So, when those markets move, it can have implications for the wider economy, your money, and even your pension.

Find out what we know about the new Prime Minister so far, who’s in his cabinet, and why the bond markets could be important to both Burnham’s premiership and your finances.

Some small, early policy changes, but nothing too concrete - yet

So far, Burnham’s given little away in terms of policy. But we’ve seen a few early changes that suggest what sort of leader he intends to be. That includes:

• a cut in VAT on electricity bills from October, saving the average household around £45 a year; 
• reverting the cap on bus fares outside London to £2 from January, which Keir Starmer had increased to £3 at the start of last year; and
• a 20% cut in business rates for English pubs, clubs, and live music venues from April.

The Prime Minister did also mention the frozen Personal Allowance for Income Tax, too. The threshold has been frozen at £12,570 since 2021, dragging more people into paying tax over time.

Burnham said he heard much frustration around the allowance during the Makerfield by-election. 

He’s since said that he’s not making any “immediate commitment” to changing the threshold. However, he did add that it could be considered at the next Budget this Autumn.

Beyond that, Burnham’s priorities are a little less defined and it’s yet to be seen where he’ll focus his attention. 

As Manchester Mayor, his ideology focused around a belief in business friendly socialism. In essence, he looked to support the UK’s free market while prioritising social programmes that improve peoples’ lives.

Meanwhile, it rejects the beliefs of neoliberalism, which focuses on free markets and reduced government spending. 

Burnham's been highly critical of this form of governance and its policies, such as trickle-down economics.

With those principles that he followed as Mayor of Manchester in mind, the Prime Minister looks set to explore these on a national level. To now, his priorities include:

• helping with the cost of living; 
• higher infrastructure investment; and 
• increased defence spending.

However, the issue he faces is that Britain’s become increasingly reliant on borrowing via the bond markets to fund day-to-day spending and long-term investment. 

Debt levels are elevated and demands on the public finances continue to grow, from healthcare and pensions to defence and infrastructure.

That means he’ll need to raise the money somehow, and borrowing more in bonds might be the lever he chooses to pull - more on this in a moment.

Burnham’s cabinet includes a few familiar faces

While Burnham’s the man in the top job, it’s also important to consider his cabinet. The Prime Minister’s responsible for the government’s decisions at large. But it’s the Members of Parliament in his cabinet who’ll have to deliver the policy work.

That makes this group of high-ranking politicians just as important for you and for markets.

Burnham’s cabinet includes a number of people who played a key part in Keir Starmer’s government. That includes former Deputy Prime Minister and Housing Secretary, Angela Rayner. She returns to her role at the Ministry of Housing, Communities and Local Government, although not as Deputy leader.

Meanwhile, former Defence Secretary John Healey’s now Chancellor. Former Health Secretary Wes Streeting's stepping in at the Ministry of Defence. 

Others have also kept their previous roles. That includes:

• Pat McFadden as Work and Pensions Secretary, with Torsten Bell as Pensions Minister;
• Shabana Mahmood as Home Secretary; and
• Sir Alan Campbell as Leader of the Commons.

Eyes will certainly be on Chancellor John Healey as he tries to balance the books while managing the government’s spending.

Similarly, Torsten Bell will be able to continue work on his plans of streamlining the pensions system and boosting UK investment.

View the whole of Burnham’s cabinet.

Bond markets have reacted negatively

This brings us to the bond markets.

Bonds are loans investors make to companies or governments. In the case of UK government bonds, they’re also known as ‘gilts’.

When bond interest rates rise, it means the cost of borrowing the money’s increased, making it more expensive. Think of it like a personal loan or mortgage - if the interest rate rises, so do your repayments.

Over time, that can make it even more difficult for the government to borrow money. As the government’s overall debt increases, lenders might view it as riskier to lend to. In turn, that can fuel higher interest rates and more expensive borrowing, and so on.

This can also happen in response to uncertainty in government, or changes that lenders perceive to be financially bad.

These changes may sound intangible, but they’re hugely important to the Prime Minister. In fact, it was a sudden rise in bond yields that forced the Bank of England to intervene after Liz Truss and Kwasi Kwarteng’s disastrous Mini-Budget in September 2022.

Before he became Prime Minister, Burnham and the bond markets already had somewhat of an adversarial relationship. 

Back in 2025 when he was Manchester Mayor, Burnham said that he thought the UK government shouldn’t be at the mercy of the bond markets.

At that time, the 10-year gilt yield - that’s the bond’s interest rate divided by the price - hovered around 4.73%.

Markets were relatively calm after Burnham initially announced he was throwing his hat in the ring for Prime Minister. But after taking office and naming his cabinet, they were less buoyant. 

Gilt yields rose above 5% on Monday 20 July, and stayed there overnight. That was largely in response to his statements that he’d look for “flexibility” within the government’s spending rules.

If the new Prime Minister and Chancellor intend to spend freely to achieve his goals, we could see yields stay higher for longer.

What higher gilt yields could mean for your money

A change in Prime Minister could be consequential for all of us. Policy changes could affect you directly, positively and negatively. Or it could be indirectly if they influence things like economic growth or inflation.

Likewise, bond yields don’t just matter to the government - they could also affect you and your individual finances. 

When gilt yields rise, it can filter through into other forms of borrowing, including mortgage rates.

Not only might that put a squeeze on your money as a whole, but it can also influence everything from housing market activity to consumer spending.

It could also affect your pension, depending on what type of scheme you have. 

• Defined contribution - with these schemes, your savings are usually held in a range of different investments. So, it depends on the plan you have and how much of it is held in bonds, rather than stocks and shares. If your plan does include gilts, you could see shifts in the value of your savings.
• Defined benefit - also known as ‘final salary’ pensions, this type pays a fixed income, usually for life. To do so, schemes often invest heavily in gilts, giving them certainty over the incomes so they’re able to pay out to their members. A rise in yields can reduce costs for schemes. However, it can also lower the value of your pot if you wanted to transfer it to a defined contribution scheme.

As we wait to see what’ll happen next with Burnham’s government, there might not be an immediate need to make changes to your money or pensions. 

It’s still very early days, and we don’t know exactly what the priorities will be. We’ll likely learn a lot more at the Autumn Budget later in the year.

In the meantime, it can be sensible to stick to your plan and keep following the fundamentals of saving for the future. That means:

• making the most of pension tax rules and allowances while they’re favourable;
• taking advantage of tax relief to boost your contributions; and
• contributing what you can afford to build long-term security.

Whatever direction Burnham’s government takes, it’ll be well worth staying across his premiership. Being informed can help you adapt as and where you need to.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

For years, the phrase ‘gap year’ brought to mind backpacks, hostels and young people setting off to ‘find themselves’ before starting work. Today, a different generation is embracing the same idea, but for different reasons.

More people in their 50s, 60s and beyond are taking what's become known as a ‘golden gap year’. It's an extended break later in life that could be used to rest, travel, volunteer or learn something new.

For some, the break is prompted by redundancy or burnout. For others, it's the moment children leave home, caring responsibilities ease, or retirement finally comes into view. And sometimes, it's simply a feeling that life is too short to keep putting dreams on hold.

A golden gap year doesn't have to mean luxury cruises or round-the-world adventures. It could also mean volunteering in your local community, taking an art course, learning a new language, or spending unhurried time with grandchildren.

It's often less about escaping life and more about asking what the next chapter could look like. But it pays to take a little time first, to make sure your finances can support the journey.

Why golden gap years are having a moment

The Covid-19 pandemic changed how many of us think about time. Instead of waiting for a traditional retirement date, some people are now asking whether they could enjoy a slice of that freedom a little sooner. 

After decades spent balancing careers, housing costs and family life, taking time for yourself can start to feel less like an indulgence, and more like restoring some balance.

It's part of a broader shift in how people think about retirement. Barnett Waddingham's At Retirement Reckoning report found that travel is now the most-cited retirement ambition, chosen by 36% of UK adults, ahead of spending more time with family (32%).

At the same time, UK government research found that 55% of people aged 40 to 75 would consider a Midlife MOT to reassess their work, finances and wellbeing.

Planning for a midlife gap year

Taking a year out at 22 years old or later at 58 are very different decisions. At 22, the biggest worry might be delaying your first job. In midlife, stepping away from work can affect your income, your pension contributions, your National Insurance (NI) record and your retirement plans.

Your State Pension is based on your NI record. Most people need 35 ‘qualifying’ years to receive the full new State Pension, though the exact number depends on your own circumstances. A qualifying year is any tax year (6 April - 5 April) where you’re:

• employed and earning over £242 a week (2026/27) from one employer and paying NI contributions;
• employed and earning between £129 and £242 a week (2026/27) from one employer and are treated as having paid NI contributions;
• self-employed and paying Class 2 NI contributions;
• making voluntary NI contributions; or
• receiving NI credits.

If you stop working for a while, you could miss a qualifying year. Some people keep building their record through NI credits, others don't. The good news is that a gap isn't necessarily permanent.

You can usually pay voluntary contributions to fill gaps from the past six tax years. But it’s worth knowing that the price has gone up. Class 3 contributions rose to £18.40 a week from April 2026, meaning a full missing year now costs £956.80 (2026/27).

The best starting point is checking your State Pension forecast and NI record, so you know where you stand before deciding anything.

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What happens to your pension while you're away?

Taking time away from work doesn't mean your pension stops. But it could affect how much is paid in while you're away, depending on your employment status and the type of leave you're taking.

Your workplace pension may pause

If you're employed, you may be paying into a workplace pension through Auto-Enrolment. Auto-Enrolment is a UK law that means most eligible full-time and part-time employees are automatically enrolled into a workplace pension. Both you and your employer usually make contributions, so if your pay stops, those contributions could pause too.

If you're planning unpaid leave or a sabbatical, ask your employer what will happen to your pension while you're away. Some employers continue making contributions during certain types of leave, while others don't.

Missing contributions for a short period isn't necessarily a problem. But it's worth understanding the impact beforehand, so there are no surprises and you can plan with confidence.

Self-employed contributions

If you're self-employed or freelancing, there's no employer paying into your pension for you. So a pause in contributions can leave a bigger gap than it might for someone in employment.

And when work goes quiet, pension contributions are often one of the first things to pause.
It helps to know that even if you earn less than £3,600 annually or don't earn anything, the maximum amount you can contribute to your pension whilst receiving tax relief is £2,880 net. This brings your total annual contribution to £3,600 gross once tax relief is added (2026/27).

Keeping up smaller contributions during a career break can help your retirement savings carry on growing, even while everything else is on pause.

Using your pension to fund the time off

If you're over 55, it might be tempting to dip into your pension to pay for a golden gap year. But the rules can be more complicated.

Most modern workplace and personal pensions are defined contribution pensions. You can usually start taking a flexible income from this type of pension from age 55 (rising to 57 from 2028). But once you begin flexibly drawing your pension, you trigger the money purchase annual allowance (MPAA).

This limits how much tax relief you can receive on contributions you make afterwards, cutting your allowance from £60,000 down to £10,000 a year (2026/27). The MPAA only applies to defined contribution pensions and doesn't affect defined benefit pensions.

If you're planning to return to work and rebuild your pension afterwards, understand this rule before you touch your savings. And if you're considering using your pension to fund a long break, regulated financial advice can help you see the full picture.

A full year isn't the only option

If a full year break feels too big a leap, financially or otherwise, there are smaller ways to get some of the same freedom.

You might try:

• several longer holidays spread across a year;
• a career sabbatical;
• volunteering closer to home;
• studying something you've always wanted to learn;
• gradually reducing your working hours before retirement; or
• combining part-time work with travel.

A shorter break can still give you that sense of space and possibility, just with less pressure on your finances and your career.

Your pre-departure checklist

Before you start packing, it’s important to take stock of your finances.

Check your retirement plans by:

• reviewing your State Pension forecast 
• checking your NI record for any missing years;
• finding out whether filling any gaps would increase your entitlement;
• reviewing your workplace and personal pensions;
• estimating any pension contributions you'll miss while away;
• considering whether you can keep contributing during your break; and
• avoiding accessing pension savings (from age 55, rising to 57 from 2028) without understanding the tax implications first.

Review your work and income by:

• working out exactly when your income will stop;
• speaking to your employer about sabbaticals or flexible working, if that's an option;
• confirming what happens to your workplace pension while you're away;
• creating a realistic budget for the break; and
• thinking about how you'll ease back into work afterwards. 

Don't forget the practical details such as:

• arranging suitable travel insurance;
• checking your home insurance if your property will sit empty;
• reviewing any mortgage or rental commitments;
• keeping an emergency fund separate from your travel budget; and
• updating your financial providers if your contact details change while you're away. 

Summary

A golden gap year can be joyful, restorative and more achievable than you might think. Whatever you dream of doing, taking time out doesn't have to come at the cost of your future.

Planning ahead makes all the difference. Check your State Pension forecast, understand your NI record and review your pension savings so you can move forward with confidence.

And if you've built up pensions with different employers over the years, bringing them together into one place could make it easier to see exactly where you stand before you take your next big step.

A golden gap year doesn't have to come at the expense of your retirement. With a bit of planning, it's possible to enjoy time away today while keeping your long-term finances on track. 

Risk warning

Please note that tax rules change regularly, and the actual tax benefits you receive will depend on your individual circumstances. If you’re not sure, please seek professional advice.

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

Most parents save for the milestones that come early: university, a first car, a gap year, maybe a deposit on a first home. There's one milestone that rarely makes that list, and it might just be the biggest one of all: their child's retirement

It can feel strange to even think about, when your child is still small enough to fit into nappies. But retirement is one of those goals where starting early really does make an outsized difference, simply because the longer money is invested, the more time it has to grow.

Plenty of parents know about the Junior ISAs (JISA). Fewer have come across Junior Self-Invested Personal Pensions (SIPP), even though the two have a lot in common. Both let you invest on your child's behalf, and both let that money grow free from UK Income Tax and Capital Gains Tax (CGT).

Where they really part ways is timing. One is there for your child to spend once they reach adulthood. The other is there for them to use in retirement. 

Junior ISA: help for life's first big steps

A JISA is built to help your child get started in adult life. You can pay in up to £9,000 a year (2026/27), and the money grows free from CGT while it's invested. When your child turns 18, the account simply becomes an adult Individual Savings Account (ISA), and from that point on, it's theirs to use. 

For many families, that's what makes a JISA so valuable. It can help build a lump sum over the years, ready for some of the biggest milestones of early adulthood 

A JISA can be held in two different ways.

• Cash JISA - this works much like a regular savings account. You put in money and earn tax-free interest. Cash is usually lower risk and lower reward. While the money is safe from stock market ups and downs, it might lose its purchasing power if inflation is higher than the interest you earn.
• Stocks and Shares JISA - with this type, through either specific company shares or a diversified index fund. Investing is usually higher risk and higher reward. The value of stocks can go up and down, so while there’s a chance to make more money, there’s also a chance to lose some.

One of the biggest advantages of a Stocks and Shares JISA is that your child can't access the money until they turn 18. That built-in restriction encourages long-term saving, giving investments more time to ride out short-term market ups and downs and potentially grow over the years.

The trade-off is equally clear. Once your child turns 18, the account automatically becomes an adult ISA and the money is legally theirs. They can keep it invested, withdraw some of it, or spend it however they choose.

As your child approaches their 18th birthday, it's worth having an open conversation about the account. Explaining how much is there, what it could be used for, and the potential benefits of leaving some or all of it invested could help them make a more informed decision when the time comes.

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Junior SIPP: help decades down the line

A Junior SIPP works towards a very different goal. Rather than helping your child at 18, it's designed to support them much later in life when they retire.

As most children have no earnings, you can pay in up to £2,880 each tax year (2026/27), and HMRC tops that up with tax relief.

The money then stays invested until the Normal Minimum Pension Age (NMPA), which is currently 55, due to rise to 57 in April 2028. For a child born today, that means nearly six decades for their money to grow before they can touch it.

How the government top up works

Most UK taxpayers get a 25% tax top up from the government, so if you pay in £100 in eligible contributions, HMRC usually adds £25, bringing the total to £125. It's one of the few places where the government is actively adding money to your child's future alongside your own.

This isn't limited to parents, either. Grandparents, aunts, uncles and family friends can all contribute to a child's pension too, and it's a lovely alternative to another toy for a birthday or Christmas.

For example, if you pay in £100 a month on someone's behalf, the government tops that up to £125, and over a year, that's £1,500 going into their pension from your £1,200 in contributions.

What difference does this actually make?

Imagine you pay in £100 a month from the day your child is born until they turn 18, then stop and leave the money invested from there. The family pays in exactly the same amount either way, but the outcomes look quite different, because every Junior SIPP contribution gets a top up, meaning more money is invested from the very start.

Source: Calculator.net. Based on an investment growth assumption of 5% a year, after a 0.70% annual management fee. These figures are examples only, shown in today's money.

Under these assumptions, the Junior SIPP grows to around £317,300 by age 67, compared with around £253,800 for the JISA. That's a gap of roughly £63,500, and it comes entirely from the same £21,600 the family paid in either way.

Reaching £1 million

You can contribute up to £2,880 net a year into a Junior SIPP, or £240 a month. Whether that grows to £1 million by age 67 depends largely on the investment growth you assume.

Under the assumption of 5% annual growth, contributing the maximum from birth to age 18 could build a pension pot of around £761,500 by age 67, just short of £1 million. Under a more optimistic 8% annual growth assumption, the same contributions could grow to around £4.1 million by age 67.

At that growth rate, even a much smaller monthly contribution could grow to more than £1 million over the same period.

Source: Calculator.net. Based on investment growth assumptions of 5% and 8% a year, after a 0.70% annual management fee. These figures are examples only, shown in today's money.

What this really shows is how much of the work is done by starting early, rather than by paying in large amounts later on. Parents who want to save beyond the Junior SIPP allowance could also use a JISA alongside it, since the two can complement each other by helping your child at different points in life.

A simple way to boost this further

There's a tweak that can make a real difference over 18 years: increasing your contribution slightly each year, rather than leaving it fixed at the same amount the whole time.

Say you start at £100 a month and simply raise it by 5% every year, a modest annual increase, rather than sticking to £100 a month for the full 18 years.

By the time your child turns 18, you'd be contributing around £229 a month, and the family's total contributions would come to around £33,800, compared with £21,600 for a flat £100 a month.

Left to grow under the same assumptions, that could build a pot of around £469,300 by age 67, compared with around £317,300 for the flat contribution.

Remember, investment growth isn’t guaranteed and inflation can’t be predicted. But it's a useful reminder that a modest starting contribution doesn't have to stay modest forever, and even small yearly increases can add up to a meaningfully larger pot by retirement.

So which one is right for your family?

There's no single right answer because each account has a different job to do. A JISA can help your child with the first big milestones of adult life, while a Junior SIPP is designed to support them decades later in retirement. For many families, using both can offer the best of both worlds.

The biggest advantage you can give a child isn't always a larger contribution - but rather more time. 

A JISA gives investments around 18 years to grow before your child can access the money. A Junior SIPP gives them 50 years or more, with tax relief boosting every eligible contribution along the way. That extra time gives investment returns longer to compound, which can make a significant difference over the long term.

Whether you're saving for their first steps into adulthood or helping them build financial security for later life, starting early means time can do more of the heavy lifting.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

A workplace pension is a valuable employee benefit. It's also one of the most effective ways to save for retirement, because your employer contributes too.

If you're thinking about asking your employer to pay more into your pension, it's worth doing some research first. Understanding how Auto-Enrolment works, knowing what's typical in your industry, and preparing your case, can make the conversation easier.

Here's what to know before speaking to your employer, how to ask for an increase, and what to do if they say no.

How does Auto-Enrolment work?

Auto-Enrolment is a UK law. It means most employees - both full-time and part-time - are automatically signed up to a workplace pension by their employer.

To qualify, you need to be aged 22 to State Pension age (66, rising to 67 from 2028), earn at least £10,000 a year and work in the UK. You also can’t already be a member of a workplace pension scheme. 

If you earn less than £10,000, but above £6,240, you won’t be automatically enrolled. However, if you ask to join, your employer can’t refuse you and must make contributions on your behalf. 

If you’re eligible, your employer must pay in. The minimum contribution from your employer under Auto-Enrolment rules is 3% of your qualifying earnings. This is your annual earnings between £6,240 and £50,270 (2026/27). You can then pay in 5%. Together, that makes 8%. Your 5% includes basic rate tax relief, so your actual cost is usually 4%. Basic rate tax relief means part of your 5% comes from the government, not your own pay.

Some employers pay more than the legal minimum. Government figures show that employer pension contributions tend to be much higher in financial and insurance services (around 9%) than in construction (around 3%).

The legal minimum stays at 8%, no matter how long you've worked for your employer. Some employers do pay more the longer you stay, so it's worth checking your pension scheme rules.

Will my employer match my pension contributions?‍

An employer may also offer to match your contributions. This means they'll pay in more if you agree to pay in more too. For example, if you both pay in 5%, the total going into your pension would be 10% of your salary.

This all depends on your employer, your pension scheme, and your own role and seniority.

What difference will it make if my employer pays more?

A small increase in employer contributions could make a big difference over time. The more that's paid into your pension, the more you could have in retirement.

Extra contributions also give your pension more time to benefit from potential investment growth and compounding. Compounding is when any returns you earn go on to earn returns of their own.

Plus, most UK taxpayers get tax relief on their personal pension contributions. This means the government effectively adds money to your pension pot. Basic rate taxpayers usually get a 25% tax top up. So if you pay in £100, HMRC usually adds £25, bringing your total to £125.

Even an extra 1% from your employer could make a noticeable difference. The exact amount depends on your salary and on investment returns, which aren't guaranteed.

How can I ask my employer to pay more towards my pension?

Asking your employer for more can feel daunting. But a little preparation can go a long way.

Here’s what you can do get ready:

• Check your contract - look at your pension details for any rules on employer contributions. Your HR team should be able to explain your options.
• Do some research - find out what's typical in your industry and for your level. Job adverts and trusted colleagues can be useful sources.
• Review your pension - check your latest statement so you know exactly how much you and your employer currently pay in.

Once you’ve done your due diligence, you can:

• Arrange a meeting - you can raise it during a one-to-one or performance review. Be clear about the contribution level you'd like.
• Follow up in writing - it can be a good idea to send a short email after the meeting, confirming what you discussed and any next steps. That gives you a record to refer back to.

If your employer agrees, they'll usually arrange the change through your workplace scheme.

If they say no, don't be discouraged. Ask whether a smaller increase is possible, or discuss salary sacrifice if it's available. Salary sacrifice means you give up some of your salary, and your employer pays that amount into your pension instead.

There may be budget reasons why your employer can't increase contributions right now, but they should be able to explain why and tell you when to ask again.

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What happens if I'm self-employed?

‍If you're self-employed, instead of a workplace pension you may have a Self-Invested Personal Pension (SIPP) or a personal pension.

The main difference between SIPP and personal pension is control. A personal pension invests your money for you, in a ready-made plan. A SIPP lets you choose your own investments, such as funds, shares, or commercial property. Both let you pay in what you can, when you can, which makes them appealing for self-employed people.

When you work for yourself, saving for retirement is entirely your responsibility. You don’t benefit from a workplace pension and employer contributions. Any boost in contributions has to come from you so it’s important to be aware of the annual limits and tax details.

The annual allowance is the limit on the gross amount that can be saved into a pension (whether that’s a personal pension or a SIPP) each tax year without incurring tax charges. The current standard annual allowance for pension contributions is £60,000 (2026/27), and this includes personal, employer and any third party contributions.

Can I ask my employer to pay into my SIPP or personal pension? 

If you work full-time and already have a SIPP or a personal pension, your employer might be able to pay into it directly.

Most companies set up Auto-Enrolment with one pension provider for all their staff. But this isn't always the case. If you work for a small company, and your employer is happy for you to use your own pension, you may be able to ask them to pay into it instead.

Employer contributions work the same way whether they go through Auto-Enrolment, a SIPP, or a personal pension. They're free from Income Tax and National Insurance (NI), and they still count towards your annual allowance of £60,000 (2026/27).

There's a separate limit on tax relief. You can get tax relief on personal and third party contributions up to 100% of your salary or relevant earnings, capped at £60,000 a year (2026/27). Tax relief isn't applied to employer contributions.

Summary

Asking your employer to pay more into your pension starts with research. Check your contract, see what's typical in your industry, and review your latest statement. Then raise it in a meeting and follow up in writing.

If they say yes, the extra contributions could make a real difference over time, thanks to tax relief and investment growth. If they say no, ask about smaller increases or salary sacrifice, and try again later.

If you're self-employed, you can pay into your own personal pension instead. And if you want to help someone else save, you can make third party contributions to their pension too.

Rebecca Goodman is a freelance Personal Finance Journalist. She regularly writes for several national newspapers including the Independent, the Mail on Sunday, the Sun, and the Guardian along with a number of specialist publications. 

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. Tax rules can change and benefits depend on individual circumstances. This information should not be regarded as financial advice. 

‍

The following is a transcript of a bonus podcast episode of The Pension Confident Podcast. Listen to the episode or scroll on to read the conversation.

PHILIPPA: Hi, welcome to another ‘Behind the Pensions’ bonus episode. This time we hear from Sally.

SALLY: I’m prepared to take a risk with this money for my value system. I thought rather than just talking about green issues, put your money where your mouth is.

PHILIPPA: This year we’ve been hearing listeners like you talking about their pension stories, and today we hear from Sally. She’s a 66 year old eco-driven retired Accountant from Devon, and she had to cope with a financial upheaval when she  least expected it.

I’m Philippa Lamb, and if you haven’t subscribed to The Pension Confident Podcast yet, why not click that subscribe button right now and you’ll never miss an episode.

Meet Sally

‍PHILIPPA: Let’s meet Sally.

SALLY: Hi, I’m Sally. I’m 66 [years old]. I was 66 yesterday, so I’m still getting over that. I live in the South West of England. I trained as an Accountant a long time ago, and I think I’ve always thought money’s to be used. So, I wasn’t the kind of person early days sticking, a little bit away every month. We went travelling, we put our money into doing it, living in a house, doing it up, moving to the next house. And so, we weren’t really that way inclined. So, I’ve always had a principle of giving at least 10% of my income to charity. So, I’ve always given a little bit of this and a little bit of that, £5 standing order to whoever. I never thought to do that for a pension.

PHILIPPA: Now, Veronica Morozova from PensionBee was listening along with me. Hi, Veronica.

VERONICA: Hi, Philippa.

PHILIPPA: Sally, she’s a trained Accountant, yet she still talks about a long period of not really engaging with her pension.

VERONICA: Yeah, and that’s actually very common. Sally’s story is a really good illustration of why, because being financially literate and actively saving for retirement are two different things. One is a skill and the other is more of a habit. So self-employed people, especially, they have no Auto-Enrolment, which is the system that automatically signs employees into a workplace pension. Without an employer to set that up for you, the responsibility falls entirely on you to choose to act, and it’s very easy to keep deferring that. The money-to-be-used mindset is also common with variable income because investing in a house or a business feels more tangible than locking money away for decades.

PHILIPPA: Sure.

VERONICA: But yeah, the numbers make a compelling case for starting early. So, you can use the PensionBee Pension Calculator. So, someone starting with just £5 a month at 25 [years old] could have almost £8,000 extra at 65 [years old]. Compared to just over £4,000 extra if they start at 40 [years old]. So, it’s the same contributions, very different outcome, purely because of time.

PHILIPPA: Yeah, absolutely.

‘Present bias’ and money

‍PHILIPPA: Now, Sally’s relationship with money was completely altered when something utterly unexpected happened to her.

SALLY: So, my husband died suddenly in his 40s. So, wow, every - the landscape changed, everything changed. And I think it made me think, live for now. I thought, well, gosh, I could drop down dead in a year. It made me think more shorter term. So, I think the tricky thing was getting over that and starting to think, I really do need to think about reducing my income now in order to have income later. And of course, the older you get, the more nervous you get about it, really. The more you've actually got to be more sensible, you start being more sensible. Oh, I love having those kinds of conversations, and I love bringing up things like money in, when I’m talking to people, friends and everything, because everybody shuts down, nobody likes it. So, I often say, declare myself, out myself.

PHILIPPA: Isn’t this interesting? With some people who lose a spouse, I think they’d immediately double down and save harder because they’d be worried about not having that safety net. But Sally, for her, that shock of losing her husband, very understandably, I guess, it made her feel she might as well live right in the moment. And then, of course, later she had to consciously rewire that thinking, right?

VERONICA: Yeah. I think grief can really push people toward a ‘life is short’ mindset.

PHILIPPA: Yeah.

VERONICA: I think what makes Sally’s story striking is that she has the financial knowledge.

PHILIPPA: Yeah.

VERONICA: She still had to deliberately relearn how to think long-term. So, this shows that the barrier is often emotional and not just informational. And behavioural economists actually call this the present bias. We consistently overvalue the present relative to the future, and a loss like Sally’s can make that even more powerful.

PHILIPPA: Interesting.

VERONICA: Yeah, and It’s not like we’re saying the goal is to stop living for the now. It’s to make small, consistent provision alongside it so you don’t have to choose between the two.

PHILIPPA: Yeah, and it’s that thing, isn’t it? Money conversation, still one of the great last taboos.

VERONICA: That’s completely right, yeah. Research consistently finds that money is more taboo than politics or religion.

PHILIPPA: It’s amazing, isn’t it?

VERONICA: Yeah, people are just very reluctant to talk about it. And for couples this can be particularly difficult because couples can have different pot sizes, different State Pension entitlements, different planned retirement ages, and all of that affect what’s possible together. And if those conversations aren’t happening, certain assumptions can fill the gap.

PHILIPPA: OK.

VERONICA: "I assumed they had a good pension", for example, is a story that we hear about a lot.

PHILIPPA: Right.

VERONICA: So, for anyone wanting to get a clearer picture, there are some simple first steps that you can take. So, tracking down any old pensions you may’ve lost track of, like the government’s Pension Tracing Service can help with that, and it’s completely free.

PHILIPPA: So, for people who want to take that first step, they can use PensionBee’s Pension Calculator, can’t they, to see where they’re at?

VERONICA: Yes, exactly. [A] really simple tool that’s available on our website.

PHILIPPA: Yeah, and a really good place to start.

Tax efficiency in retirement

‍PHILIPPA: Now Sally, she also showed some real tax savvy, didn’t she, when it came to deciding how and when she was going to start drawing from her pension.

SALLY: There was a period of time when I was 55 plus when I needed some extra income, so I had to make the decision: will I start plundering my little pot of PensionBee now to keep - tide me over? If I do that, it’ll mean that I can’t put all my house money, which will eventually happen, in. As soon as you get the 25% extra from the government, yes, when you withdraw it, you have - you can only, you only get 25% of it tax-free, as I understand it. The 75% of it gets - you have to give the tax back, but 25% you don’t. So, if you do that calculation on that money, you’ve already earned 6% because that’s what the 75%, 25%, 6% looks like. So, it’s a no-brainer in one level, just sitting there, it’ll make 6%. There was another choice  which I made, which is that when I started with it, I did a - the age-related one, the one that kind of moves with - if you’re getting older, it’ll go safer. And then I decided to make a choice for the green world and the non- paying the war machines world.

And I thought, well, I want to take - I’m prepared to take a risk with this money for my value system. Put your money where your mouth is. And in PensionBee, I could choose. So, I’ve chosen the green one, which of course has been fantastic.

PHILIPPA: So, Sally’s 6% calculation, does that add up?

VERONICA: Yes. So, Sally’s 6% calculation is indeed correct. Basic rate taxpayers [usually] get 25% tax relief, so [for] every £80 that you put in, the government tops up to £100. And then on withdrawal, 25% is tax-free [up to £268,250], 75% is taxed at [your marginal rate, usually] 20%.

PHILIPPA: So how much do you get back, net?

VERONICA: So, you get £85 on every £80 that you’ve saved.

PHILIPPA: Yeah, that’s really compelling, isn’t it? So, what triggers the [Money Purchase Annual Allowance] (MPAA)?

VERONICA: So, the [Normal Minimum Pension Age] (NMPA), for taking money from a private or workplace pension is currently 55 years old, but this age is set to rise to 57 [years old] on the 6 April 2028. And your annual tax-efficient contribution limit drops from £60,000 down to £10,000 (2026/27).

PHILIPPA: So that’s really worth knowing about.

VERONICA: Exactly, and it’s also really important that just taking your 25% tax-free cash alone without any taxable income doesn’t trigger it.

PHILIPPA: OK, also vital to know.

VERONICA: Exactly. So, Sally was weighing that exact trade-off: income now versus flexibility to put a lump sum back in later. So, if the sums involved are significant, it’s really worth talking to an Independent Financial Adviser (IFA) before acting.

PHILIPPA: Yeah, these are really important decisions. Now, in terms of which actual scheme you opt for, more and more people, they do want their pension to reflect their values, don’t they? So, what are the options?

VERONICA: Yes, so we call this values-based investing, and so Sally switched to PensionBee’s Climate Plan. It targets a minimum 10% annual reduction in carbon emissions from the companies in the fund each year and exceeds the EU Paris-Aligned benchmark. And her point about engagement is worth noting. She checks her pot regularly because she cares about what it’s invested in. People who stay actively engaged with their savings tend to make better long-term decisions.

PHILIPPA: Yes, so don’t forget about them.

Sally's vision of retirement

 PHILIPPA: Now, Sally, she turns 66 [years old] the day before we recorded this. So, what does retirement look like for her now?

SALLY: I’ve got too many to pack into one life. I’m beginning to realise I should’ve had about three lives, and even then, I probably wouldn’t pack it all in. Certainly, lots of travelling, and when I say travelling, I mean taking a month or six weeks. I cycle, so I go on my bike and, and cycle through Europe. But I do want to paint as well. Like the little picture on the back. I do want to draw and paint more. I like being able to wake up in the morning and listen to the birds for a long time, particularly a robin who sings to me in the morning. I’m sure of it.

PHILIPPA: She’s got a clear vision of how she wants her retirement to be, hasn’t she? I mean, we could all usually spend a bit of time thinking about that.

VERONICA: Yeah, planning for a retirement that you actually want. I think retirement planning should start with the picture, really, not a number. And Sally’s vision is quite specific, and that makes it plannable. So, she’s not stopping, she’s actually shifting. And that’s really worth emphasising because retirement still gives people that image of an ending rather than a new beginning, and that just puts a lot of people off engaging with retirement planning at all.

PHILIPPA: Yeah.

VERONICA: And so, for example, the Pensions UK Retirement Living Standards that have recently been updated give a useful example of how much you might expect to need. So, for example, for a minimum it’s £13,900 for a single person (2026/27).

PHILIPPA: So that’d be a minimum standard of living?

VERONICA: Yes, a minimum standard of living. So quite frugal, I’d say.

PHILIPPA: And if you were looking for a more moderate lifestyle?

VERONICA: Yes, so Pensions UK Retirement Living Standards say that the moderate lifestyle would probably cost about £32,700 a year (2026/27), which would, again, for a single person, cover two weeks holiday abroad, maybe running a car, regular social spending.

PHILIPPA: OK, and if you wanted to push up your standard of living from there, what sort of money would you be aiming at?

VERONICA: So, for a more comfortable standard of living, it would be £45,400 a year (2026/27). These are just rough figures, and the richness that Sally personally describes, the slow breakfast, the yoga, cycling through Europe, they might not necessarily require the top bracket, but it does require not having to worry about having access to that income. So that’s what the pension is for.

PHILIPPA: Yeah, everyone has their own idea, don’t they, about what luxury feels like. For her, it’s those things. But as you say, the not worrying means she can enjoy them.

VERONICA: Exactly. And, one tool that we have is PensionBee’s Retirement Planner, which is available to customers in their online ‘BeeHive’ account, and that can really help connect a real-life vision to an actual savings target.

PHILIPPA: So, some hard numbers. 

VERONICA: Exactly. So, a lot of our customers find it very helpful.

PHILIPPA: Thanks, Veronica.

VERONICA: You’re welcome.

PHILIPPA: Thanks to Sally too, of course, for sharing her story with us. Now, if you’d like to find out more about pensions and retirement planning, head to the show notes for this episode. We’ve shared a tonne of resources there for you to explore and use for yourself.

Here’s the final reminder before we go, that anything discussed on the podcast shouldn’t be regarded as financial advice or as legal advice, and of course, when investing, your capital is at risk. Thanks for being with us. We’ll see you next time.

‍

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

This blog is part of our quarterly plan performance series. Catch up on last quarter’s summary here: How PensionBee’s plans are performing as at Q1 2026.

Much like the soaring temperatures this summer, global financial markets caught their own tailwind in Q2, delivering one of the most resilient recoveries we’ve seen in recent years.

Following a challenging first quarter from the Middle East conflict, the financial markets staged a strong comeback, regaining lost ground to finish on solid footing.

Stock markets and political events across the globe shifted the quarter results. Namely, de-escalation of tensions in the Middle East and the reopening of the Strait of Hormuz; an exceptional chipmakers rally fueled by hyperscale data centre expansions; Keir Starmer’s resignation as UK Prime Minister; and Kevin Warsh taking the helm as America’s new Federal Reserve Chair.

Let’s dive into how these translated into our plans’ performance over the quarter.

This blog is only meant to provide information. The data comes from our money managers. Performance data covers Q2 (1 Apr - 30 Jun 2026), sourced from money managers. Performance figures are before fees. Past performance isn’t an indicator of future performance. As with all investments, capital is at risk.

PensionBee's default plans

4Plus Plan 

The 4Plus Plan is managed by State Street with an end of Q2 equity proportion of 76.7%^ (Q1 26: 31.9%). It’s the default plan for our customers over 50 years of age. The plan is actively managed for volatility in times of market turbulence, whilst targeting an annualised 4% return above the Bank of England base rate, over a minimum five-year period. It aims to balance growth with stability for those approaching retirement or making regular withdrawals.

^Asset allocation, including equity exposure, can change on a weekly basis due to the plan’s actively managed component.

Global Leaders Plan 

The Global Leaders Plan is managed by BlackRock with an equity proportion of 100%. It’s the default plan for our customers aged under 50. The plan invests in around 1,000 of the largest public companies globally. It aims to maximise the growth of pension savings in the years before retirement.

^ The plan was launched in February 2025, so performance data for the 3-year and 5-year periods is currently unavailable.

PensionBee's specialist plans

Climate Plan

The Climate Plan is managed by State Street with an equity proportion of 100%. The plan objectives, following a Paris-Aligned Benchmark and reducing portfolio carbon emissions by 10% a year, are set out in the plan factsheet, which explains how these targets are measured and reported. 

^ The new Paris-aligned strategy was launched in September 2024, so performance data for the 3-year and 5-year periods is currently unavailable.

Shariah Plan

The Shariah Plan is managed by HSBC and traded by State Street with an equity proportion of 100%. The plan invests in the S&P Global Shariah index of over 500 stocks that meet Shariah compliance principles, as set by an independent Shariah Committee.

PensionBee's other plans

Tracker Plan

The Tracker Plan is managed by State Street with an equity proportion of 80%. The remaining 20% is allocated to fixed income. The plan offers a cost-effective way to follow global markets as they move.

Preserve Plan

The Preserve Plan is a money market fund managed by State Street. The plan makes short-term investments in highly creditworthy companies to preserve capital. It's designed for savers who want to take less investment risk, in exchange for lower potential returns.

Learn more about how your pension’s invested

Your pension can be invested in a range of assets like company shares (stocks), bonds, real estate, commodities and cash. Your pension balance fluctuates depending on how these assets perform. See below for a summary of global markets and the performance of our key asset classes in Q2 2026. 

How did global stock markets perform in Q2 2026?

Global stock markets showed a stunning comeback with multiple major stock indices soaring.

^Source: MSCI, FTSE Russell, S&P Global. Data as at 30 June 2026.

Please note that the performance figures above are reported in local currencies, except for the MSCI Asia ex-Japan, which is reported in USD due to the use of multiple currencies among its constituents.

Asia

The tech-heavy Asian market led the way. South Korea’s leading stock index, KOSPI, posted a stellar return of 68%* over the quarter. The key drivers of the index were chipmakers SK Hynix and Samsung Electronics, two of only three companies that make the HBM (high-bandwidth memory) chips that power data centre builds. The MSCI Asia ex-Japan index posted a 27.8% return.

Japan had a solid quarter too. While tech companies like SoftBank drove significant gains, a weak yen played a key role. In an export-heavy economy like Japan, the majority of corporate earnings are generated in US dollars. When these overseas earnings were converted back into a depreciated yen, it translated into record high corporate returns.

*Source: Korea Exchange index data via investing.com, data as at 30 June 2026.

US

Stock investors shifted their interest back into the technology sector, the growth-oriented US stocks had a great quarter, enjoying solid double digit gains as the S&P 500 posted a 14.9% return. The rally was driven by resilient corporate earnings and a de-escalation of conflict in the Middle East that eased global inflation concerns, and renewed AI enthusiasm.

However, there is still a lingering worry about whether the AI bubble may burst. The world’s largest tech companies are pouring huge amounts of business capital into data centre builds without guaranteed near-term returns.

Just as valuation fears increased, the market found a bit of a safety valve in Washington. The notoriously hawkish Kevin Warsh made his debut as the new Chair of the US Federal Reserve in mid-June. In his first Federal Open Market Committee meeting (a group from the US central bank that makes interest rate change decisions), Warsh decided to hold the interest rates steady. This decision gave much needed breathing room to capital-consuming tech giants, and access to stable borrowing costs to fund their hyperscaling data centre projects.

Europe

Europe saw a more balanced return profile across both growth and value, led by the technology and financial sectors. The Netherlands emerged as the top performer among European peers. The Dutch chipmaking powerhouse, ASML, delivered strong earnings results thanks to a massive surge in equipment orders, as chipmakers scrambled to expand capacity for hyperscale data centre projects.

Meanwhile, the European Central Bank (ECB) increased rates at its June meeting. Spanish banks were able to charge more for loans while keeping savings rates very low. This had rapidly increased their profits and attracted stock investors' interest. The MSCI Europe ex-UK posted a solid 14.9% return.

UK

The UK posted a modest gain, with the FTSE 350 up 4.6% over the quarter. The UK market showed great resilience by balancing out sharp movements between its heavyweight energy and financial sectors. This dynamic was triggered when the US and Iran signed a memorandum of understanding to end their conflict and reopen the Strait of Hormuz. As a result, global oil prices started falling, resulting in declines in energy stocks. 

However, the financial sector emerged as a major beneficiary of the agreement. Falling crude prices significantly eased global inflation fears, giving investors the confidence to rotate into value-oriented sectors like financial services. 

On the political side, Prime Minister Keir Starmer’s announcement that he would step down caused barely a ripple, as markets had already priced in the transition well in advance. Investors were prepared for his expected successor, Andy Burnham. In fact, the market seemed to favour the political shift, responding positively to Burnham’s recent signals toward a tightening of fiscal policy.

How did UK bond markets perform in Q2 2026?

UK bond markets experienced a volatile but strong quarter with both corporate and government bonds posting returns. The MSCI GBP Investment Grade Corporate Bond gained 2.8%, while the Bloomberg Barclays UK Gilts gained 2.1%.

As of 30 June 2026, the 4Plus Plan’s bond allocation was 16.3% and the Tracker Plan's UK gilt allocation was 9.8%. Index Source: MSCI and Bloomberg. 

Despite the strong quarter, UK government bonds (also known as gilts) endured a bumpy ride over the three months. The gilt yields fluctuated sharply in May following the Labour Party’s losses in local elections, which triggered Keir Starmer’s resignation as Prime Minister later in the quarter.

However, the impact from this domestic news was neutralised by global geopolitical relief. Driven by the US and Iran agreement and the subsequent reopening of the Strait of Hormuz on 17 June, the oil price eventually dropped. This led to easing inflation fears, fuelling a powerful bond rally. 10-year UK gilt yields ended around 4.88%.

Conclusion

Looking back, the diverging returns of Q1 and Q2 serve as a great reminder of how resilient financial markets are. Ultimately, the volatility and subsequent recovery witnessed this quarter is just one of many cycles the market has successfully navigated in the past and, of course, will handle in the future.

Have a question? Get in touch!

Do you want to know more about your pension plan with PensionBee? Learn more about the top 10 holdings in your pension fund on our blog, which is regularly updated. You can also look at our Plans page to learn how your money is invested in different assets and locations, or log in to your BeeHive to see your specific plan. You can always send comments and questions to our team via engagement@pensionbee.com. 

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

Much of the UK’s in its third heatwave of the year - and it’s still only early July.

It follows a June that rewrote the record books. Last month, the Met Office issued a rare red extreme heat warning (the level reserved for the most severe events). Meanwhile, a new June temperature peak of 37.7°C was recorded in Norfolk. The UK’s all-time high of 40.3°C, set in July 2022, no longer looks like a distant outlier.

During heatwaves, other extreme weather events can also occur. On 23 June, the Met Office recorded 29,074 lightning strikes across the UK. London was hit by flash flooding and the London Fire Brigade took around 400 calls overnight. At least two house fires are believed to have been sparked by lightning. 

While extreme weather dominates the headlines, there’s a long-term savings angle you might not have seen. Your pension is more connected to these extreme weather episodes than you might think. Both in where your money’s invested today, and in how a rapidly changing climate could shape your retirement planning and future income. 

This isn't 'just weather'

It's tempting to think that extreme weather’s just an anomaly. The science, however, says otherwise - at least for the heat.

The Met Office says that temperature extremes in the UK are becoming more frequent and more intense. The UK has been warming at around 0.25°C each 10 years since the 1980s, and 2025 was the warmest year ever recorded here. 

Chief Scientist, Stephen Belcher, has a clear explanation for why. Without human-caused climate change, he says, it’d be "virtually impossible” for UK temperatures to reach 40°C. 

In short, the heat we're seeing this summer is part of a gradual and predicted upwards temperature trend. It’s not a one-off.

It’s about financial risk too 

Climate change poses financial risk to your retirement savings.

In June 2026, days after the UK’s record heat, the Society of Pension Professionals (the professional body for the experts who run UK pensions) published a report. Titled ‘Pensions in a Warming World’, it warns that climate risk is now retirement risk. Climate change has shifted from a future concern to a present-day financial reality for pension schemes. 

The report also makes a point that’s easy to miss. Pensions are invested across the economy and for decades at a time, diversified across sectors and regions. That can help offset losses in one part of your investments if a single company or industry doesn’t perform so well. 

But climate risk affects the whole economy, rather than one corner of it. A hotter, more disrupted world could push up costs and drag on productivity.

As a result, it’s harder for pension schemes to get away from climate risk. They can’t avoid it the way they might by divesting from struggling companies or sectors - it affects everything at once. 

There are real physical costs in a warming world. The everyday cost of living, including health, infrastructure, food, and insurance, is increasing as extreme weather becomes more common. 

Some of that cost is already being counted. A City Hall study behind London’s first-ever heat plan estimated that the capital’s 2022 heatwaves cost the city around £1.5 billion. That was across:

• health;
• transport;
• energy;
• emergency services;
• wildfires, and;
• lost productivity.

The study also warned that heat-related hospital attendances across the UK could triple by 2050.

It’s a similar story for home maintenance costs. Data from the Association of British Insurers shows that UK insurers paid out a record £6.1 billion in property claims in 2025. That includes £1.2 billion for weather damage alone.

For a growing number of homes, the concern is shifting from the price of cover to whether it’s available at all. Homes built since 2009 are already excluded from Flood Re, the industry and government scheme that keeps flood premiums affordable. The scheme’s only a temporary backstop, due to end in 2039. There are around 6.3 million properties in England already in flood-risk areas. That could see home insurance become inaccessible for many.

Back in 2019, the then-Governor of the Bank of England, Mark Carney, co-signed an open letter warning that the financial risks from climate change are potentially existential. In it, he urged banks, insurers, and regulators to treat those challenges as core financial risks, rather than an afterthought.

The wider economic risks are notable. Research shows that, without changes, climate and natural damage could cause a loss of around 50% of global GDP between 2070 and 2090. 

Your pension is invested for decades, so how the climate changes matters for your money too.

What you can actually do about it

The good news is that, as a pension saver, you have more influence than you might think. There are a couple of practical steps worth thinking about.

• Factor the changing climate into how much you save - a warmer world will likely push up the cost of living over time. This means the pension pot you’ll need in retirement could be larger than past trends suggest. Saving a little more now, if you're able to, helps build in that buffer. 
• Check what your pension is funding - you can ask your provider where your money’s invested and what their climate policy is. That includes whether the plan you’re invested in still includes companies that are large emitters.

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To help them invest in line with these views, our customers asked us to create the PensionBee Climate Plan. This is a 100% equity plan that excludes fossil fuel producers. It also reduces exposure to carbon-intensive companies via a Paris-Aligned index as you save for retirement. 

Some of its key features:

• Excludes fossil fuels - the plan excludes companies with fossil fuel reserves. It also goes further by excluding those with any ties to direct fossil fuel reserves and those that heavily rely on them. For example, that's utility companies with fossil fuel-based power generation.
• A Paris-Aligned decarbonisation pathway - it follows a Paris-Aligned Benchmark (PAB) with a decarbonisation pathway in line with the 2015 Paris Agreement. This aims to reduce carbon intensity over time. The index it tracks targets a 10% average annual reduction in carbon emissions intensity, exceeding the EU minimum standard of 7%.
• A low-carbon future - it increases investment in companies with climate transition opportunities. It also reduces investment in companies exposed to climate transition risks.
• Long-term opportunity - it invests more in companies prepared for the transition to a low-carbon economy. That may offer opportunities that come with reduced exposure to transition and physical risks. The Climate Plan also aims for long-term financial returns on your investment.
• Beyond reducing carbon emissions - the plan also excludes other industries that harm the environment and society. That includes controversial and nuclear weapons, civilian and conventional firearms, tobacco, alcohol, gambling, adult entertainment, palm oil, for-profit prisons, recreational cannabis, and companies misaligned with the UN Sustainable Development Goals.

Read more about the PensionBee Climate Plan.

Have a question? Get in touch!

Want to know more about your pension plan with PensionBee? You can check out our Plans page to learn how your money’s invested in different assets and locations. Or, log in to your account (‘BeeHive’) to see your specific plan. You can always send comments and questions to our team via engagement@pensionbee.com.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

Your pension doesn’t work like the rest of your estate when you die. Unlike your property, savings, and other assets, it won’t automatically go to whoever inherits everything else. It isn’t covered by your will, which comes as a surprise to a lot of people. 

Here’s what actually happens, and why it’s worth a few minutes of your time to check who’s going to inherit your retirement savings.

Your pension isn’t currently part of your estate

When you die, nearly all your assets and possessions - collectively known as your ‘estate’ - are dealt with according to your will. 

If you don’t have one, the person who’s most ‘entitled’ to a share of your wealth would have to apply to become your estate’s administrator. Find out more about what happens if you die intestate on the MoneyHelper website.

The rules of intestacy would then apply. In this case, your estate goes to your spouse and children first, then other family members, and finally to the Crown if you have no living relatives.

With pensions, the picture’s slightly more complicated. There are two types of pension scheme, and the type you have will determine what happens to your savings when you die:

1. Discretionary - your pension savings are held in trust and managed by your scheme’s trustees. That sees your fund sit outside your estate and not covered by your will. That also means these pensions don’t attract Inheritance Tax (IHT). However, it’s worth noting that this is set to change from April 2027 (more on this below). Even once this change comes into place, your pension still won’t be covered by your will.  
2. Non-discretionary - also known as ‘direction-based’, you nominate who you’d like to receive the funds and your pension scheme will pay out exactly in line with your request. As you’re directing where those funds go, HMRC treats it as your money. As a result, it can be brought into your estate and subject to IHT.

Most modern personal pensions, like PensionBee’s, are discretionary. 

In this case, the pension trustees will decide who receives your funds when you pass away. They base that decision on who you’ve nominated in an ‘expression of wishes’. That person is known as your ‘beneficiary’, or ‘beneficiaries’ if you choose more than one person.

It’s worth noting that, unlike a will, an expression of wishes isn’t legally binding. Your pension scheme’s trustees will take your choice into account, but they have the final decision.

You may have chosen your beneficiaries when you first set up your pension. Or you may never have done so at all. 

I checked my own pension recently and discovered I hadn’t nominated anyone - the trustees would’ve been completely unaware of my wishes. If that sounds familiar, you’re not alone.

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Who inherits your pension?

Your pension beneficiaries don’t update automatically. So, depending on your age and the type of pension you have, you could be leaving a significant sum, or a long-term income, to whoever you initially chose.

As a result, it’s worth revisiting your choices after any major life event, such as:

• marriage; 
• divorce; 
• estrangement;
• bereavement; or 
• the birth of a child.

It’s also worth doing this after making key financial decisions with your pension, such as if you start drawing down. Likewise, it’s sensible to do so if your chosen beneficiary’s financial situation changes - that might impact who you’d most like to receive any money.

The good news is it usually takes minutes to do and you should be able to do this online.

With PensionBee, you can do this via your online account - your ‘BeeHive’ - in just a few clicks.

If you have several pension pots, you’ll need to do this for each of them. While you’re at it, you may want to use the government’s free Pension Tracing Service to make sure you haven’t lost track of any retirement savings from previous jobs.

Pensions and Inheritance Tax

Because pensions sit outside of your estate, they’re currently exempt from Inheritance Tax (IHT). 

If there’s money left in your pot when you die, your beneficiaries can inherit it without an IHT bill. They may still pay Income Tax on withdrawals, depending on your age at death. But the pension itself won’t be subject to IHT.

That changes from April 2027, when unused pension pots will be brought into your estate for IHT purposes. For some people, adding the value of their pension to their property and other assets could push their estate over the £325,000 nil-rate band.

As a result, it’s worth thinking carefully about who you nominate as your beneficiary.

Not sure how much your pension could be worth by the time you retire? Use PensionBee’s Pension Calculator to get an estimate.

Should you change your nomination before April 2027?

If your estate’s likely to be affected by the IHT changes, it’s worth understanding how your beneficiaries fit into the picture. In particular, you may want to think about whether it’d be more tax-efficient to leave your pension to your spouse or civil partner, or your children.

Your spouse or civil partner can inherit your entire estate IHT-free. So, if they inherit your pension, they’d receive it free from IHT. That won’t change after April 2027. 

But once the new rules come in, your pension will count as part of their estate when they die. Married couples and civil partners can combine their IHT allowances, potentially passing on up to £1 million free from IHT. But a large pension pot could use up a chunk of that.

Note that this only applies to married and civilly partnered couples. It doesn’t apply to other relationships, even if you’ve been with your partner for a significant amount of time. 

Meanwhile, if you were to die before April 2027, nominating your children instead could mean your pension passes to them IHT-free. 

They may still pay Income Tax on withdrawals, depending on your age at death. But there’d be no IHT charge. 

After April 2027, the picture changes. Your spouse or civil partner can inherit your pension free from IHT, thanks to the spousal exemption. So, nominating them again at that point could make more sense. Remember: the exemption only applies to spouses or civil partners, not children or any other family members.

You could consider changing your nomination to your children now, then switching it back after April 2027. It’s a straightforward thing to do - but whether it’s the right move depends on your estate and your family circumstances. It won’t be right for everyone.

Summary

Think the IHT changes could affect your estate? Speaking to an Independent Financial Adviser (IFA) could help you make decisions around who inherits your pension. 

In the meantime, checking and updating your beneficiaries could help make sure your pension ends up where you want it.

Ruth Jackson-Kirby is a Financial Journalist passionate about making money matters clear and accessible. She’s written for The Mail on Sunday, MoneyWeek, The Sun, and Good Housekeeping, helping readers navigate pensions and personal finance with confidence. She believes everyone deserves financial security and is on a mission to cut through jargon and make finance relatable. 

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

Please note that tax rules change regularly, and the actual tax benefits you receive will depend on your individual circumstances. If you’re not sure, please seek professional advice.

Most of us like to think our financial decisions are rational. We weigh up the options, consider what we can afford and make sensible choices. 

But money is more than arithmetic. It's personal, and maybe surprisingly, it’s emotional. And the feelings it stirs up can shape our financial decisions just as much as the numbers do.

Our attitudes to money don't appear overnight. Many are shaped by lessons we picked up early in life, and those beliefs can still influence how we save for retirement today.

These beliefs are known as money scripts.

What is a money script?

The term was coined by financial psychologists Brad Klontz, Ted Klontz and Rick Kahler. They describe money scripts as beliefs about money that we didn't consciously choose. They're shaped by childhood experiences, family attitudes and the messages we absorbed growing up.

Maybe money was rarely discussed at home. You might have experienced financial hardship, or grown up feeling that money was something to worry about rather than talk about openly. 

Over time, these experiences become internal rules about how money should be earned, spent, saved or avoided. We may not even realise they're there, but they can influence financial decisions for decades.

A 2025 study in the Journal of Financial Therapy found a direct link between how money was talked about in childhood and the money scripts we carry into adulthood.

It may help explain why two people in similar situations can think about money in completely different ways.

The four money scripts

Money beliefs aren't usually one-size-fits-all. Most people have a mix of attitudes that shape how they think about spending, saving and planning for the future. 

There are four broad money scripts, and each shows up differently when it comes to pensions.

Money avoidance

People with a money avoidance script often carry a belief that money is somehow negative. They may believe that wealthy people are greedy, or that wanting more makes you shallow. Perhaps they’ve grown up in households where finances were never openly discussed.

As adults, that can lead to a tendency to disengage from money altogether by:

• leaving pension statements unopened;
• avoiding logging into any finance related accounts; and
• putting off financial decisions indefinitely.

This is often because engaging with money feels emotionally uncomfortable.

A PensionBee report on pension procrastination found that 53% of UK adults say they've given their pension a fair amount of thought. Yet fewer than one-in-five plan to review or increase their contributions. A third say their pension simply isn't a priority right now.

For many, the gap between intention and action isn't about laziness but rather about discomfort.

Money worship

Money worship is built on the belief that more money will lead to greater happiness. The idea behind it is that wealth is the answer, and there's never quite enough of it.

People with this script often work hard and chase financial success, but struggle to feel satisfied with what they have.

Typically, for those with a money worship script:

• spending feels rewarding;
• saving feels restrictive; and
• financial contentment can feel out of reach.

When it comes to pensions, the challenge is that retirement saving offers no immediate reward. Spending today feels more real than saving for a future that feels far away. 

Money status

For people with a money status script, financial success becomes closely tied to self-worth. Money becomes a way of measuring achievement, progress or social standing.

The challenge for pension saving is that it's largely invisible. No one sees the extra pension contributions you made this month. There's no letter of ‘congratulations’ when you do the right thing.

If success means being seen to succeed, pension contributions can feel hollow.

Money vigilance

Money vigilance is often seen as the most financially healthy script. People with this mindset save regularly, avoid debt and think carefully about the future. Research in the Journal of Financial Therapy found a positive link between money vigilance and pension saving.

But even helpful habits have a trickier side.

When caution tips into anxiety, some people become so worried about making the wrong decision that they struggle to make any decision at all. Others save diligently but never feel confident they've done enough. They might stick to regular contributions and see their pension grow, but the sense of financial security never quite arrives. 

How you can start shifting your script

The first step is noticing your script. You can’t challenge a belief you haven’t yet named.

1. Find out where you stand

A helpful starting point is a short online quiz developed by Klontz and his colleagues that can help you identify your money script. It takes around five minutes.

It won't tell you everything, but it can surface beliefs you didn't realise you were carryin

2. Try writing it down

When a money situation triggers a strong reaction, write down:

• what happened;
• what emotion came up; and
• what you felt the urge to do next.

Over time, you'll start to see patterns. That awareness alone can create a pause between the trigger and the response.

3. Talk to someone

If your money script is rooted in financial hardship or long-held shame, speaking to a professional could help.

Financial therapy is a growing field that helps people understand and change their relationship with money. You can find therapists who specialise in money issues through the BACP therapist directory.

Cognitive behavioural therapy (CBT) is another option. When a money-related thought arises, you write it down, examine the evidence for it, and test a more balanced alternative. This can help you challenge a belief rather than accepting it as true.

For free support, the Money and Mental Health Policy Institute is a good place to start.

4. Slow down the reaction

Mindfulness is the practice of noticing what you’re thinking or feeling in the moment, without immediately acting on it.

In practice, that looks different depending on your script. If you tend to avoid money matters, notice the urge to close the browser tab before checking your pension - then stay for one more minute. If you struggle with impulsive spending, notice the pull of a purchase before you click.

It's not about eliminating the feeling. It's about creating a small gap between the feeling and the response. 

The bottom line

We often think better pension habits start with spreadsheets and financial plans. But sometimes, they start somewhere else entirely.

The way you think about money today may have roots you don't even remember. But understanding them can make habits that once seemed stuck a lot easier to shift. 

Recognising those scripts could be one of the most valuable financial decisions you make.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

The following is a transcript of a bonus podcast episode of The Pension Confident Podcast. Listen to the episode or scroll on to read the conversation.

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Takeaways from this episode

• Bull markets last longer than bear markets - historically a rising ‘bull’ market produces bigger gains and outlasts the ‘bear’ market downturn that precedes them.
• Keeping contributions going during a downturn can work in your favour - if you buy shares at a lower price, when the market eventually recovers, those holdings might be worth more than what you paid.
• Tax relief acts as a built-in buffer - a basic rate taxpayer putting in £100 receives £25 in government tax relief, cushioning the initial contribution from the impact of a market fall.

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PHILIPPA: Welcome back. Today’s bonus episode is all about something that often makes headlines - market volatility. Whether it’s tariffs, geopolitical tensions, or yet another twist in the Westminster news cycle, the markets have had a turbulent time recently. And if you’ve noticed your pension balance moving up and down, you’re not alone. So, what’s actually going on, and what does it all mean?

We’re going to look at what you need to know. Whatever stage you’re at, we’re going to talk about why the plan you’re in matters, and perhaps most importantly, explain why you shouldn't rush to action. I’m Philippa Lamb, and if you haven’t subscribed to the podcast yet, you can click that subscribe button before we start. Now, here to help me make sense of market volatility is Maike Currie. She’s PensionBee’s VP Personal Finance. Welcome back.

MAIKE: Thanks for having me. Great to be here.

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What’s market volatility?

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PHILIPPA: Now, look, before we get into volatility, when people talk about the markets, what exactly are the markets?

MAIKE: Well, the easiest way to think of the stock market is a place where you can buy or sell slices of companies. So, think of it a bit as a farmer’s market, but instead of buying [a] fruit or vegetable, you’re buying a small portion of a business.

PHILIPPA: OK, so what’s market volatility?

MAIKE: So, the key thing to think about is the prices of these company slices that you’re buying can go up rapidly if a lot of people want to buy a share. Or also fall rapidly, if a lot of people are rushing for the door. So, volatility really is that rapid movement in share prices, and it can be caused by a number of things. It can be caused by geopolitical events, it can be caused by uncertainty. The key thing really is that market volatility is part and parcel of investing.

PHILIPPA: It can happen really quickly, can’t it?

MAIKE: It can happen really quickly, but as quickly it can dissipate. So, the key thing isn’t to panic and to know that markets never move in a straight line. They go up and down.

PHILIPPA: Yeah, and we hear these terms ‘bull market’, ‘bear market’.

MAIKE: What exactly do they mean? Well, I’m no David Attenborough, but they really replicate the movement made by these animals. So, a bull kind of thrusts up with its horns, and that represents a rising stock market.

PHILIPPA: OK.

MAIKE: And a bear would typically swipe or claw down, so a bear market would represent a falling market. So really, a bull market is when markets are rising over a bear market is usually when the market falls, and the definition of a bear market is if the market has fallen more than 20%.

PHILIPPA: OK, and these are a normal part of the cycle, it’s worth saying.

MAIKE: Absolutely. The key thing we always say, and the key thing that investors need to remember, is that markets go up and down over time. But really, if we look at the difference between a bull market and a bear market, bull markets - so when the market is rising like the bull’s horns - they tend to last much longer than a bear market, which typically lasts around 10 months. And I guess the key thing to remember is that bull markets typically tend to last longer than the bear markets or the losses that go before them.

PHILIPPA: So, they produce bigger gains generally.

MAIKE: Generally. There’s no hard and fast rule, and as we always say, past performance is no indication of future performance. But there’s enough research out there that shows over the long term, stock markets tend to outperform more.

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How far can a pension balance fall?

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PHILIPPA: OK, but obviously from an investor point of view, you know, if you see your pension balance falling, it’s concerning. Worst case, what would it actually take for it to get to zero?

MAIKE: Well, it’s important to put this in context because for your pension to go down to zero, every single holding, every company share that your pension is invested in, will need to fall to zero. Now, that has never happened, even in the dark days of the Great Depression, even during World War II, even during the COVID-19 pandemic. We [have] never seen that. Yes, markets fell quite drastically and quite rapidly, but they did recover over time and in fact recouped all the losses and ended up higher than where they started.

PHILIPPA: I’m thinking that for listeners who are earlier in their careers, this might all feel a bit alarming because, you know, they’ve just started building up their pot, the pot’s probably quite small, suddenly they see it dropping in value.

MAIKE: It’s going to be concerning, but honestly, if you’re just starting on your pension journey, you’re in the best place possible because time is on your side. And as I always say, the most powerful force when investing, and when you’re putting money into a pension, isn’t how much you’re putting in necessarily, but time. When you start out, you’ve got time to ride out those ups and downs, those bear and bull markets, and over time the market will smooth out, and you’ll see your portfolio eventually recovering those losses.

PHILIPPA: Even though we always say “Past performance is no guarantee of future performance”, and that’s true, markets have historically always come back, haven’t they?

MAIKE: Absolutely. Markets have historically always come back. And if we look at history, a good example of this is the Dow Jones Industrial Average, which is one of the oldest stock market indices out there. Now, between 1997 and 2021, that market rose 357%. What’s key to remember is that period included some of the most seismic market events we’ve seen, including COVID-19 pandemic, the global financial crisis, and others.

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The investor upside of a market downturn

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PHILIPPA: So, should those younger savers then maybe think about pausing contributions during a downturn?

MAIKE: Actually, keeping your contributions going is the best possible approach because you’re buying those shares at a lower cost, and when the market recovers in value, those shares you bought in the dip are actually worth more. So, you basically got a bargain on the sales rack.

PHILIPPA: OK, now I heard what you said about younger savers having longer for all this stuff to, you know, iron out over time. If you’re closer to retirement, volatility is going to be a bigger worry, isn’t it?

MAIKE: Absolutely, because when you’re closer to retirement, you’re getting closer to the point where you want to draw money from your pension pot. So, a massive market event which wipes out some of the value of that pot can be very concerning, and your biggest focus then isn’t so much on growth but on stability, preserving that pension value. So, what you can do is you can ride out the ups and downs. You can possibly look at taking less from your pension pot, giving it some time to recover.

PHILIPPA: So older savers might be, I think, perfectly understandably nervous. There’s going to be a temptation to take their money out, isn’t there?

MAIKE: There will definitely be a temptation, but the key thing to remember is when you do move money out of the market during a market fall, you’re essentially locking in losses.

PHILIPPA: Because you don’t have a chance to recover later?

MAIKE: Yeah, so when the market does recover, and sometimes it can do that relatively quickly, you’ve basically sold at the bottom of the market. And it’s really key to remember that the [Financial Conduct Authority] (FCA), the city watchdog or the regulator, actively encourages investors to stay patient and to remain invested during times of volatility. That really is, even though it does test the nerves, is the best possible approach when we see those massive moves in share prices.

PHILIPPA: So, thinking about those older savers again, should they at least think about pausing contributions?

MAIKE: The key thing I'd say that we really need to remember with a pension, and what makes a pension different from a [Stocks and Shares] ISA, is when you contribute money into a pension, you automatically get government tax relief. So, say I’m a basic rate taxpayer and I’m putting in £100, I get 20% tax relief. So, I’ve got £25 added to my pension. Now let’s say the market does fall dramatically. In fact, let’s say it falls as dramatically as it did during ‘Black Monday’ [crash of 1987], which was a massive crash which saw the Dow Jones fall by [around] 20%. Even if I saw that kind of once-in-a-lifetime fall, because of the tax relief, I’ll still have £100 in my pension. Now, if I had put that £100 into a [Stocks and Shares] ISA, I wouldn’t have received any money in the form of tax relief that would have cushioned me against any market fall. And I think a lot of savers underestimate the power of tax relief. It’s free money from the government. What’s not to like about that?

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How quickly can markets recover?

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PHILIPPA: Yeah, there’s a lot of ins and outs with pension contributions and tax relief, but we did do a bonus episode all about that back in May. So, if you listen to this and you’d like to know more about that, go back, have a listen to that one. Give us more recent examples, because we were talking about Black Monday, that was a long time ago. More recent examples of how quickly markets can recover.

MAIKE: So actually, if we go back in recent memory, there’s been quite a few dramatic market events. The first one I’ll refer to is back in 2022 when Russia invaded Ukraine. Dramatic time in markets. The S&P 500 fell 7% and everyone was really worried about what the future could hold. But less than a month later, the market had rebounded and actually ended up higher where it started.

PHILIPPA: And we had another one, didn’t we, with President Trump’s Liberation Day tariffs. 2025, that was last year.

MAIKE: Just remind us [of] what happened with that one. Well, very recently really, in recent memory as you say, April 2025, Trump’s Liberation Day, a big hoo-ha about tariffs. The market acted very dramatically. There was a 12% fall. In May, the market had recovered and in fact it was 3% higher than where it had been. So, as you can see from these examples, you can have quite dramatic falls in markets, but over time they do recover, sometimes quicker than we expect.

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Pension plans for different life stages

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PHILIPPA: What you can usefully do, it seems to me, is look at your plan, right? Because it’s not just about how you react during volatility. A lot does come down to the investment plan your money is in to start with, right? So how can you tell if you’re in the right plan for the stage you’re at and the state of the markets and everything you’d need to think about?

MAIKE: The key thing to say is different plans are built for different stages of your retirement journey. And as we spoke about, when you’re at the start in your early 20s and you’re saving into your pension, you’ve got more time to ride out market volatility. Whereas if you’re in your 50s and you’re getting closer to retirement age, it’s really about preserving capital and about stability. So, with PensionBee, we’ve got a number of plans that are suited to those different life stages. Our Global Leaders Plan is for anyone under the age of 50. It’s well diversified over the 1,000 biggest companies in the world. But then we also have a 4Plus Plan, which is for those over 50s, and that’s all about looking at volatility, managing volatility, and delivering a return around 4% plus the bank base rate. But very much managing volatility, which obviously is key if you’re in that age group.

PHILIPPA: As you say, obviously these plans are specifically aimed at people in certain stages and ages, but it’s up to them, right? I mean, it’s about their appetite for risk, so they can choose whichever they want.

MAIKE: That’s true. You don’t need to go into a specific plan just because you fall into that specific age group. The key thing is what’s your appetite for risk and when do you want to draw down your pension.

PHILIPPA: So, any sort of rule of thumb for which type of plan might suit which type of saver?

MAIKE: Well, as a PensionBee customer, I'd look at the full suite of PensionBee’s plans, and if you still have questions, you can always speak to a PensionBee 'BeeKeeper', which is a UK-based team. Or once again, if you need to, you can speak to a regulated [Independent] Financial Adviser.

PHILIPPA: Maike, thank you. Really helpful as always. A brilliant reminder that markets going up and down isn’t the story. Staying invested and staying in the right plan and staying calm, that’s the story.

If you’re enjoying the series, we’d love it if you’d let us know with a rating or a review. It really does help us reach more people who could benefit from these conversations. If you’ve missed an episode, don’t worry about it, you can catch up anytime on your favourite app, YouTube. If you’re a PensionBee customer, of course, you can listen in the PensionBee app too.

Here’s our usual final reminder: anything discussed on the podcast shouldn’t be regarded as financial advice or as legal advice, and when investing, your capital is at risk. Thanks for being with us, we’ll see you next time.

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Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

This is part of our monthly series. Catch up on last month’s summary here: Your May 2026 market update: stock markets reach new highs despite global uncertainty.

When we look back at June 2026, the first thing that’ll come to mind will probably be the sweltering heat dome that pushed UK temperatures to record highs for the month.

Of course, unlike much of British infrastructure, global markets don’t grind to a halt when the thermometer climbs above 30 degrees.

It’s been a busy month around the world. We’ve seen political change, seismic shifts in the tech market, and split decisions on interest rates that could be a sign of what’s to come this year.

Find out more in your June 2026 market update. 

The headlines: Japan has its best quarter on record as the US lags behind

Japan’s Nikkei 225 stormed to an all-time high on 25 June. A rally in tech and Artificial Intelligence (AI) infrastructure stocks drove growth. 

That’s been helped by a weak Japanese yen. Exporters selling to the global market have received more for their dollars than they might have otherwise.

Plus, Prime ‌Minister Sanae Takaichi was re-elected in February on a pro-business mandate. Businesses have benefited from this commitment to back commerce and revive the economy.

Less can be said for the rest of Asia. By the close of the first half of the year, overseas investors had pulled $137.36 billion from shares in South Korea, Taiwan, India, Indonesia, Thailand, Vietnam, and the Philippines.

In large part, that’s down to investors taking their returns from South Korea and Taiwan. Both countries have seen impressive growth this year thanks to big tech winners. That includes SK Hynix and Taiwan Semiconductor Manufacturing Co (TSMC). 

The US was also not so fortunate. Although the S&P 500 recorded yet another record high at the start of the month, the index closed down from its strong opening.

That was in large part due to a tech sell-off and rotation - find out more below.

Elsewhere, performance in Europe was mixed. Inflation came in at 2.8%, down from 3.2% in May, which was welcome news. Like in Japan, European chipmakers crucial to the AI buildout, such as Siemens, rallied at the end of the month.

However, European carmakers - particularly in Germany - looked less healthy. Traditional choices in the auto sector have struggled to compete with the low prices of Chinese challenger brands. 

That’s led giants such as Volkswagen to consider steps like shutting four German factories and making as many as 100,000 job cuts. 

Closer to home, the UK injected a new dose of political uncertainty in June. Prime Minister Keir Starmer announced his intention to resign. Yet, markets barely reacted, with the FTSE 350 recording a positive month (more on this below). 

Keir Starmer resigns, but markets stay calm

The big news in the UK this month was Keir Starmer’s announcement that he’ll resign as Prime Minister.

Starmer campaigned on a promise of stability, after a turbulent period that saw five government leaders in just 12 years. 

Instead, his short tenure will see him memorialised as Labour’s shortest-serving Prime Minister.

Such uncertainty can panic investors and cause them to react, leading markets to dip.

But markets were noticeably calm after his resignation. After a brief fall in the value of the pound and a rise in gilt yields (that’s the government’s borrowing costs), markets stabilised.

That was seemingly helped by newly-sworn in MP for Makerfield, Andy Burnham, confirming his intention to run for the job. 

With former Health Secretary, Wes Streeting, backing Burnham, June finished with just one candidate vying for the top job. A leadership contest could spook investors and see markets wobble. But investors seemed calmed by Burnham throwing his hat into the ring alone.

Markets responded even more favourably after Burnham laid out his vision as Prime Minister at a speech in Manchester.

Borrowing costs fell and the pound rose as Burnham described his intentions to set up a “No. 10 North” and devolve power away from Westminster. 

He also described a “laser-like focus on growth and regeneration”. That commitment could've contributed to the positive market reaction.

What remains to be seen is who the next Prime Minister will appoint as Chancellor, and what their fiscal policy will be.

US tech dominates headlines as investors pivot 

As it has throughout 2026, the US tech sector dominated headlines in June. However, it was a slightly different landscape this month.

Firstly, Elon Musk’s space exploration, communications, and AI company, SpaceX, listed on the stock market.

This was initially a resounding success - at least for Musk. Investors’ appetite for SpaceX saw the company raise $75 billion and pushed shares to $161 when the market closed on the first day of trading. That made Musk the world’s first trillionaire.

However, less than two weeks after its IPO, SpaceX announced a $20 billion bond issuance. The company later increased that to $25 billion.

Bonds are debts that companies take on to fund projects. They then pay back the loans with interest.

It’s a seemingly odd choice for a company that just raised $75 billion to then take on another $25 billion in debt.

But it speaks to the huge cost of AI infrastructure and what it’s going to take for the business to become profitable.

That understandably spooked investors. SpaceX shares peaked at just over $200 on 16 June. But when markets closed on 30 June, they were just below $171 - higher than they initially floated for, but less than that peak.

SpaceX isn’t the only company to have taken on large amounts of debt like this last month, either. Nvidia raised $25 billion, while Alphabet - the parent company of Google - issued $31 billion.

Investors move away from the Magnificent Seven to chipmakers

Investors also started selling off the so-called ‘Magnificent Seven’ at the end of June. That’s the group of big tech companies comprised of:

• Apple;
• Amazon;
• Alphabet; 
• Meta; 
• Microsoft; 
• Nvidia; and 
• Tesla.

The sell-off saw the companies’ combined value shrink by $2.3 trillion.

Concerns over the immense cost of the AI buildout no doubt played a part here. 

Another aspect has been price rises. As chipmakers have been busy supplying AI data centres, there’s been a surge in demand for those components.

However, they’re also critical for hardware, such as in Apple and Microsoft products. This creates a supply issue, pushing up chip costs.

Both companies announced price rises off the back of this. Investors may be worried about what this might mean for sales and revenue.

While the dip has been bad news for these businesses, companies supporting AI infrastructure benefited. 

The Philadelphia Semiconductor Index tracks a basket of chipmakers, like TSMC, Micron, and ASML. It’s often used as a proxy for how the sector’s performing.

Data shows that the index is up 6% this month. Across the year, it’s risen by 90%, versus a 3.4% decline across the Magnificent Seven.

Investors have been put off by the tech companies’ big AI outlays. Instead, it seems they’ve turned to the businesses that have profited from all that spending. 

Some central banks raised interest rates as inflation concerns continue

As for financial policy, interest rates paint an interesting picture of what’s happening around the world.

Since the start of the war in Iran, rising oil prices had pushed inflation above expectations. As a result, rather than cutting rates as predicted at the start of the year, central banks have largely held interest rates so far in 2026.

That’s what we saw in the UK and US in June. Both the Bank of England (BoE) and the Federal Reserve (Fed) held rates. 

Meanwhile, the European Central Bank (ECB) and Bank of Japan (BOJ) both raised rates this month.

While these economies are all facing different pressures, the ECB and BOJ’s decisions may be the first of many rate rises this year.

Risk warning

As always with investments, your capital is at risk. Past performance is not an indicator of future performance. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

Most of us know someone whose life changed because of their health.

A colleague who had to stop working before their retirement after a diagnosis. A friend who entered the workforce already managing a chronic condition. Or a parent who gave up full-time work to care for a disabled child. 

When we think about the financial impact, we often focus on reduced income. But there's another consequence, and that's the effect on retirement savings. When work stops, pension contributions often stop too. Over time, that gap can grow far larger than many people realise.

New PensionBee research found a stark gap in retirement savings. Disabled people who work part-time could retire with £245,000 less than a non-disabled full-time worker. Our Sick, Tired and Never Retired report looks at why. 

The hidden retirement gap facing disabled people

One-in-four people in the UK is disabled, up from one-in-five a decade ago.

But the pension system wasn't built to reflect that reality. It was designed around a fairly traditional idea of working life. Stable employment, regular contributions, and a working life that followed a predictable path.

But illness and disability don't work to a schedule.

Health challenges don't just affect your day-to-day life. They can also make it harder to earn, save and plan for the future. And unlike many financial setbacks, the impact can begin years before retirement is even on the horizon.

To better understand this, PensionBee surveyed more than 900 disabled people of working age and in retirement.

The findings showed:

• 91% are worried about their future financial security;
• 48% have no pension provision beyond the State Pension;
• 52% of those with private pension savings have saved less than £10,000; and
• 46% became disabled before the age of 30.

When you become disabled has an impact too. PensionBee's modelling shows a non-disabled full-time worker could retire with £355,213. A disabled person working part-time could have just £109,886. That's a gap of £245,327.

The impact can start in childhood. The proportion of disabled children in the UK has nearly doubled in a decade, from 7% to 12%. Many of these children face extra barriers to education and work as they grow up. That makes building financial security harder from the start.

Why does disability affect pensions so much?

It's rarely one thing alone. Lower earnings, time out of work and higher day-to-day costs can all make it harder to save for the future. Over the course of a working life, those pressures can add up and leave disabled people with less in retirement. 

Lower earnings

Disabled workers earn less on average than non-disabled workers. Many also work part-time or in flexible roles. While flexible work can make employment possible, some part-time roles fall below the £10,000 Auto-Enrolment threshold - the minimum earnings level at which employers must automatically enrol eligible workers into a pension scheme. That’s why pension contributions may not start automatically, meaning the savings gap can begin before it's even noticed.

Gaps in employment

Periods of illness, treatment and recovery can interrupt employment. While any worker may experience time away from their job, disabled people are often more likely to face repeated interruptions over the course of their career. 

Higher costs in later life

For most people, retirement brings a chance to slow down. But disability-related costs don't necessarily ease with age. In some cases, they may even increase.

Expenses linked to care, mobility, specialist equipment or support can continue well into later life. That can leave disabled retirees balancing ongoing needs against savings that may have taken longer to build.

Housing inequalities

Disabled adults are less likely to own their home. Lower incomes, time out of work and difficulty getting a mortgage all play a part. More disabled people rent into retirement as a result. That puts extra pressure on their income later in life. 

What practical steps can help?

Although many of these barriers are outside an individual's control, there are still ways to build greater financial security for later life.

Check what pension savings you already have

If you've worked for different employers over the years, you may have previous pension pots you've forgotten about.

The government's free Pension Tracing Service can help you track them down. Having a clear picture of your savings is often the first step.

Don't overlook National Insurance credits

If you receive certain benefits, you may qualify for National Insurance (NI) credits that protect your State Pension entitlement, even during periods when you're unable to work.

This includes recipients of:

• Personal Independence Payment (PIP);
• Employment and Support Allowance (ESA); and
• Universal Credit.

Checking your NI record can help you spot any gaps.

Contribute when you can

Not everyone can afford to save regularly. But even small contributions can benefit from tax relief. Most UK taxpayers get a 25% tax top up from the government. So if you pay in £100, HMRC usually adds £25, bringing your total to £125. If your income varies month-to-month, a personal pension can give you the flexibility to contribute when you're able. 

You can still save even if you're not working

You don't need to be in paid work to contribute to a personal pension. If you can set money aside, you can contribute up to £2,880 a year (2026/27) and the government will usually top it up to £3,600 through tax relief.

Carer's Credit can help protect your State Pension record while you're caring. A personal pension may also help you keep building private savings during those years.

Are you receiving the support you're entitled to?

PensionBee’s research found that half of people who meet the legal definition of disability aren't claiming disability benefits. 

Benefits such as PIP aren't means-tested. That means it doesn't matter how much you earn or have in savings. Eligibility is based on how your condition affects your daily life, not your finances. If you've never applied, or if a previous application was unsuccessful, it may be worth reviewing your options. Find out more about disability benefits.

If you're still working, check your workplace pension status

If you earn below the Auto-Enrolment threshold, it's worth asking your employer about joining their pension scheme. Some will still contribute on your behalf, even if they're not required to. 

What friends and family can do to help

If you know a person who lives with a disability, you may already support them in lots of ways. That could mean helping with day-to-day tasks, offering emotional support, or simply being there when they need you.

But support can also extend to their financial future. There are practical ways friends and family may be able to help a disabled person build greater financial security in retirement.

Talk about pensions

Many people don't identify as disabled, even when they are. And many carers don't realise how much their caring role can affect their long-term savings. Starting that conversation and sharing your knowledge can be the first step towards someone getting support they didn't know existed.

Contribute to their pension directly

You can pay into someone else's pension through what's known as a third party contribution.

As with personal contributions, the government tops up what you pay in. You can contribute up to £2,880 a year (2026/27) and this usually becomes £3,600. 

Help them check what they're entitled to

Many people who qualify for disability-related support don't realise they're eligible. Helping someone explore benefits such as PIP, Carer's Credit or NI credits could help protect both their current finances and their future retirement income.

You can watch our full carer's series on YouTube.

The bigger picture: what a fairer system looks like

The solutions to these challenges lie beyond personal responsibility. Lasting progress will depend on reforms across employment, pensions policy and public services.

PensionBee is calling on the Pensions Commission and the Timms Review to consider:

• Removing the £10,000 Auto-Enrolment threshold - contributions should start from the first pound earned.
  
• Introducing a disability pension credit - to help offset savings gaps caused by reduced hours or time out of work.
• Reforming disability benefits with retirement in mind - future changes should consider long-term impact on retirement, not just short-term costs.
  
• Encouraging genuinely inclusive employment - flexible and accessible workplaces help disabled people stay in work and keep saving.
  
• Increasing public awareness - too many disabled people don't know what financial support they're entitled to. Raising awareness could help close some of the gaps in support and retirement savings. 

For nearly half of disabled people, the State Pension is the only pension they have. That's why decisions about disability support matter not just in the short term, but for retirement outcomes decades from now.

Read the full findings and policy recommendations in our Sick, Tired and Never Retired report.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

PensionBee's Climate Plan is designed to reduce the carbon emissions intensity of its portfolio over time, in line with the goals of the Paris Agreement. Find out how the plan selects the companies it holds.

The Climate Plan isn't a 'green companies only' fund

The Climate Plan tracks a custom MSCI index built to exceed the minimum standards of an EU Paris-Aligned Benchmark. Its objective is to reduce the portfolio's carbon emissions intensity by at least 10% per year against its parent index, using 2020 as the baseline year. 

This is a passive, Paris-Aligned, index-tracking approach, removing fossil fuels and enabling your plan to be invested in line with international climate agreements. The plan doesn’t follow an impact investing or green revenues strategy, so there isn’t an objective to demonstrate a positive impact for society and the environment alongside generating financial returns. 

Before any companies are selected for the index, a set of exclusion rules is applied. The most significant of these relates to fossil fuels. The plan excludes companies that own fossil fuel reserves, as well as companies with strong ties to fossil fuels. For example, utilities that rely heavily on fossil fuel-based power generation. 

The plan also excludes companies involved in:

• controversial, nuclear and other weapons; 
• civilian firearms; 
• tobacco; 
• gambling; 
• adult entertainment; 
• alcohol; 
• for-profit prisons; 
• palm oil;
• recreational cannabis; and
• activities that don’t comply with the United Nations Global Compact. 

It excludes companies assessed as ‘strongly misaligned’ with the UN Sustainable Development Goals (SDGs). For example, SDG 6 (clean water and sanitation) and SDG 7 (affordable and clean energy).

Once this set of exclusionary screens has been applied, the remaining companies are reweighted, to ensure the carbon emissions reduction objective. 

This sees companies with lower emissions (compared to their relative size) receive more investment compared to the parent index. And companies with higher emissions or that don’t demonstrate a commitment to a long-term reduction in line with the Paris Agreement goals will receive less investment over time. 

Why does big tech feature so prominently in the Climate Plan?

Among the Climate Plan’s top holdings are seven of the world's largest technology companies:

• Apple;
• Amazon;
• Alphabet; 
• Meta; 
• Microsoft; 
• Nvidia; and 
• Tesla. 

These large technology companies dominate the global stock markets, and the Climate Plan tracks a global index.

The Climate Plan tracks a custom MSCI index that uses the MSCI All Country World Index (ACWI) as its starting point. 

As of May 2026, Information Technology and Communication Services companies make up around 40% of MSCI ACWI. So, they feature prominently in any plan that follows this approach.

Additionally, there's a more specific reason these particular companies are overweighted. Relative to their economic footprint, they're lower-emitting parts of the global market. 

Using the latest climate emissions data publicly available, the seven largest technology companies combined account for just over 1% of total global greenhouse gas emissions. That’s despite the fact that they represent approximately 21% of the MSCI ACWI by market capitalisation, as of May 2026.

Here's how the latest data for each of these companies compares.

Source: State Street IM, MSCI, as of 03 Jun, 2026. For illustration only. According to Our World in Data, Global GHG Emissions in 2024 were 54.43 billion tons of CO2-eq.

The index uses specific emissions-based metrics to compare all the companies in the parent index against each other, rather than position any one company as a climate leader. 

On emissions-based metrics relative to size, the big technology companies score more favourably than others in the index.

They improve the overall carbon profile of the plan relative to its parent index. This is because they emit less relative to their size than many comparable companies. Some also earn a share of their revenue from products and services that support the transition to a cleaner economy, such as energy efficiency technology.

What about Artificial Intelligence and rising energy use?

Artificial Intelligence (AI) infrastructure requires significant energy. As a result, some of these companies have seen their emissions increase in recent years. There are a couple of things worth noting alongside that.

Five of the seven companies have emissions reduction targets approved by the Science Based Targets initiative (SBTi). This is a globally recognised framework for setting credible, science-based climate goals. 

These companies are also among the world's largest. At that scale, their decisions on the energy they buy, the infrastructure they build, and the suppliers they work with will shape the wider energy transition. The index methodology considers both their current emissions performance and their commitment to future reduction, including whether they have science-based targets approved by SBTi. That assessment can change as their trajectories shift. 

What happens if a company's emissions rise sharply?

The plan's index is reviewed twice a year. This is to check both whether companies still pass the exclusionary screens, and whether their emissions weighting needs to change as new data comes in.

If a company's emissions rise significantly, or its progress on reducing them falls, its weighting will be reduced over time. In serious cases it could be removed from the index entirely. For example, if its business model changes in a way that brings it into conflict with the exclusionary rules.

The Climate Plan is designed to reduce the overall carbon emissions intensity of the portfolio year-on-year, regardless of what any individual company does. If the seven companies in the table above stopped being the lower-emitting option relative to their peers, the index would reduce their weighting over time. 

You can keep track of monthly changes to the plan's top 10 holdings in your online account (‘BeeHive’). Or you can download the full monthly holdings list directly from the money manager, State Street, via their website.

What if I want a pension that excludes technology companies entirely?

Removing all large technology companies from a pension would mean investing outside the major global indices. Typically, that’d be through a specialist actively managed fund or an impact-focused fund.

These plans usually hold only 30-35 companies, carry a significantly different risk profile, and tend to be considerably more expensive than mainstream index-tracking pensions. At PensionBee, we believe investments should be diversified, low-cost, and simple to understand. We're customer-led, and our plans are designed for a wide range of savers.

Have a question? Get in touch!

If you have questions about the Climate Plan or want to understand more about how it works, you can read the full plan details or email us at engagement@pensionbee.com.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

The following is a transcript of a bonus podcast episode of The Pension Confident Podcast. Listen to the episode or scroll on to read the conversation.

Takeaways from this episode

• The subscription trap adds up faster than you think - the average Brit spends £696 a year on subscriptions, and Spotify, Netflix and Amazon Prime alone come to £419 a year between them.
• A comfortable retirement costs more than most people plan for - the Retirement Living Standards put a comfortable retirement for a single person at £43,900 a year.
• Lifestyle creep comes at a real pension cost - redirecting just £200 a month into your pension instead, topped up to £250 with basic rate tax relief, could add around £200,000 to your pot over 30 years.

PHILIPPA: Welcome back. Quick question for you: are you earning more than you were five years ago? Now here’s a thornier one: if you are, do you actually feel better off? There’s a sneaky phenomenon that can quietly hoover up every pay rise, every bonus, every step up the career ladder. It’s called ‘lifestyle creep’, and it might just be the single biggest obstacle between you and the comfortable financial future you’re actually working towards. So, how can you keep that destructive phenomenon at bay? That’s what we’re talking about today.

I’m Philippa Lamb, and if you haven’t subscribed to The Pension Confident Podcast yet, do it now. That way you’ll never miss an episode.

So, here to help us spot, stop, and maybe even reverse lifestyle creep, we have three guests who know all about it.

Edoardo Moreni is the Co-Founder and CEO of Emma, the personal finance app that helps over a million people track their spending, subscriptions, and their net worth. He’s seen firsthand what happens to people’s money when they don’t keep an eye on it.

Content Creator Clare Seal is one of the UK’s most trusted personal finance voices. She’s chronicled her own journey out of debt, and she’s written books on the psychology and practicalities of spending. She’s, in her own words, a recovering lifestyle creeper.

From PensionBee, this time Alex Langley, Head of Customer Success, and back for his second appearance on the podcast. He spends his days talking to PensionBee customers about their money, so he’s seen what lifestyle creep can do to people’s finances, including his own.

Hello everyone.

ALL: Hello.

‍

What is lifestyle creep?

‍

PHILIPPA: Lifestyle creep is essentially spending, well, more as you earn more and falling into that trap of just never really feeling any wealthier. Obviously, it can be about big purchases. My feeling is that it’s about the small stuff for a lot of us. I was thinking about this this very morning. I came into King’s Cross Station; I spent £4.50 on a white Americano. I looked at it. I thought about the podcast. I thought, this is [a] ridiculous amount of money to spend. But I do it. I do it often. What do you guys do? I bet you’ve got similar stuff.

CLARE: Oh, for me, lifestyle - like keeping lifestyle creep at bay is like playing whack-a-mole, honestly, because it’s, I think I’ve got youngish children, so they’re, age three to 11 [years old] and one in the middle. And so, it’s so easy to spend more on them because as you’ve more money, you just sort of think, why not, when they ask for things. And you’ve to really rein yourself in. But also, about things to fix myself. I’m 36 [years old], so I’m not even that old, but I’m just being advertised like collagen and creatine and all of these things.

PHILIPPA: Oh yeah. Edoardo, what is it for you?

EDOARDO: I think my new lifestyle creep since last year has been clothes.

PHILIPPA: Oh, really?

EDOARDO: Really bad.

PHILIPPA: I think we really need to know why this has suddenly arrived in your life.

EDOARDO: I think, because I am 33 [years old] and up until the age of 32, I was hanging on like these sort of like Christmas gifts, birthday gifts, and that was my sort of look. And after that, I just, I decided, “OK, no, now we need a reset” and I start buying. And it’s a disease, it’s like in every sense. You know?

PHILIPPA: Yeah, I know, there’s no answer. Alex, what’s it for you?

ALEX: Mine is a lot of beauty stuff. Very vain, very shallow. Because, you go to Holland and Barrett or you go to Boots and you think, “This purchase is going to change my life. It’s going to change everything. Once I’ve got this cream, everything’s going to be better”. And then of course you inevitably use it, and it doesn’t solve all of your problems.

PHILIPPA: But are you buying more expensive stuff as you earn more?

ALEX: This is the thing. I’ll buy more and then it sorts of builds. And now I’ve got into like, I get Botox as well. And so, it all sort of builds up over time.

PHILIPPA: Well, I think, we’ll get onto ‘the what’, more about 'the what', but ‘the why’, ‘the why’ is interesting to me. I mean, we’ve talked a bit about slipping into it and there’s age and there’s kids and things, but what do we think?

CLARE: I think what I see happening is that you have your current means and your life where it’s, it’s like one circle, and then outside of that there’s like a bigger circle of what you’d like your life to be like. And honestly, I think that as your means grow, as long as that circle, the outside circle, is really intentional and it’s stuff that you value and it’s stuff that’s going to bring joy or security or something, it’s going to bring something to your life, then I actually think that expanding out into that circle is fine.

So, if that’s as you earn more, you haven’t been on holiday for years, so you’d like to add in a holiday because it’s going to bring some value. Or even for so many people, like more regular trips to the dentist or swimming lessons for your children or some education. I think that’s absolutely fine. But what we quite often happen is that as your actual circle of means expands, that external circle keeps expanding as well. So, you keep sucking more things into that. The goalposts just continue to move as you achieve the things that you want to achieve.

‍

Trigger points and the psychology of spending more

‍

PHILIPPA: I think there’s trigger points as well, aren’t there? Things like, even your first salary, your first job. I mean, we all spent when we got our first pay packet, right? And it creeps up on you, but promotion, maybe you’re moving in with a partner, buying a home. All these things feel like justification, don’t they, to spend more? But as you say, it’s that thing about it being intentional rather than just luring you on.

EDOARDO: But, I think, as long as you don’t spend more than what you make and savings and investments are counted in, there’s no problem with that.

CLARE: I think it’s about having some boundaries, but not in terms of [being] really strict with yourself. I think for me, sometimes it comes down to keeping a level of respect for your future self, making sure that you’re just holding your future self in regard and taking them into account. And this is from someone who also orders a lot, like too much Deliveroo.

PHILIPPA: I mean, we all do.

CLARE: It’s so exhausting, isn’t it?

PHILIPPA: I do. I tell you where I think the difficulty arises for a lot of people who work. So, I’m freelance and the series producer of this podcast, she’s freelance too, and we’ve talked about this. All that’s great if you’re on a regular income. If you’re freelance or self-employed, your income often isn’t like that. There’s [a] real feast and famine. And you might go through months and months where you’re really, really reining everything in. And the temptation when things happen, you get a new contract or, your rates go up or more money suddenly arrives, to really splurge, because you do feel you deserve it. There are some things you definitely do need. That you haven’t got. And then before you know it, that’s the new normal, you know? So, the predictability of your income is a factor, I think, isn’t it?

CLARE: I think you’re so right. And I think that an emotion that’s really underestimated when it comes to things like emotional spending and lifestyle creep and all of that is relief. Sometimes if you’re feeling the pinch a bit, like you said, if you’ve just gone through a period where it’s more famine than feast. Or if you’ve been working in a job, maybe you’re training and you’re on a lower wage, but then you get a promotion. Sometimes that feeling of relief is really dangerous because you’re like, “Oh, I can finally let go,” and you just let go too much. That’s definitely happened to me many times in the past.

PHILIPPA: I mean, it’s other people, isn’t it? It’s the general expectation of people, friends, family, what - how they’re spending, how they’re living. You know, you’re spending time with them, It’s weird if you’re penny-pinching all the time. I find that drags your spending higher, don’t you find? Because obviously incomes vary radically. You might have friends who’re working in the city earning a load of money and people who’re working in jobs where it’s really, really low pay, but you’re still all friends. You’re still seeing each other.

EDOARDO: I mean, you don’t have to spend it if you can’t afford it. You know, like I go back to that point that you don’t have to go out, you don’t have to entertain yourself if you can’t stay at home.

PHILIPPA: Oh, sounds a bit dull.

EDOARDO: Yeah. But no, but like, that’s the whole point is like, why do people overspend? Because they’re not in control. And, there’s no, having a humble life in control is like a valuable life.

CLARE: I think I’d always fall in the middle ground of that. I really feel like you can embrace some joy in the in-between of that. And I think one of the things you’re talking about, like staying at home by yourself and not doing very much versus going out and spending a load of money. But I think in the in-between there, have people over to your house. And I always say this, like one of the most generous things that you can do is invite people into your home. Tell them to bring something so that you’re sharing the cost. Like someone brings a bottle, someone brings a dessert. Whatever it might be. But like, please, please have people round to your house even when it doesn’t look like a show home, even when it’s not super tidy, because then it gives other people permission to invite you and their other friends and family to their house even if it doesn’t look perfect.

‍

Supermarket upgrades and the subscription trap

‍

PHILIPPA: Food.

CLARE: Yeah.

PHILIPPA: Is a big one. Where you buy food.

CLARE: Mm-hmm.

PHILIPPA: So, you start out at the cheap supermarkets, right?

EDOARDO: Exactly.

PHILIPPA: And then as time goes on, as you earn more, creep up the chain, don’t you? And you end up at Waitrose.

CLARE: I’m an Ocado girl through and through.

PHILIPPA: Oh, me too.

CLARE: Yeah.

PHILIPPA: You know what I’m talking about here.

EDOARDO: That’s a quite interesting point. You know, when I started the company, my starting salary was like £25,000 for the first two years. And I wasn’t going to Waitrose, buying the burrata from Waitrose was like -

PHILIPPA: absolutely not -

EDOARDO: just terrifying, right? I still remember that feeling.

PHILIPPA: Advertising has a lot to answer for here, doesn’t it? Because, all the stuff like meal kits, this whole thing of, if you're time poor, what you need are meal kits delivered to your home. They’re very expensive. We can agree on that, can’t we?

CLARE: After that initial offer that they drag you in with that’s like really good value, and then they just trust that - it’s like any subscription. They just sort of trust that you’ll forget to cancel.

PHILIPPA: Yeah, subscriptions though. I mean, you mentioned subscription. We talked about meal kit subscriptions. Let’s talk about other subscriptions, Alex. Because I’ve heard that you’ve got a lot of them.

ALEX: Oh God, it’s terrible, isn’t it? I’m one of those people that signs up for the free one-month trial. And because in my life, like I’d say at work, I’m quite organised and I think I organise myself out.

PHILIPPA: Yeah.

ALEX: It’s like the ability to be organised, it’s been used up. And so, in my normal life, everything just is very burying my head in the sand. Oh, I’ll pay a one-month free subscription and then end up paying it for a long time. So, there’s like -

PHILIPPA: how many do you’ve?

ALEX: There are so many and I might even miss some.

PHILIPPA: We have time.

ALEX: I’ve the standard ones. So, I have Spotify, I have Amazon Prime, and I also have Netflix. And actually, just those three combined costs £419 a year. On average, if you’ve sort of a standard package. But those aren’t the only ones I’ve. So, I also -

PHILIPPA: the others are? I don’t want to drag this out of that. Is it just me feeling like I’m having to drag it out?

ALEX: I also have Disney Plus, I have Hulu, I have Sky. I also once was paying for Mario Kart on the phone. You can pay to get the different skins, and I wanted all the different ones, so I paid like a small subscription for that, and it wasn’t a lot, but that’s the point. You sign up to it and it’s £7.99, but that £7.99 adds on to the £8.99 over here, and it all adds up. And I found -

EDOARDO: times 12.

ALEX: Yeah, I had a lot of them.

PHILIPPA: Edoardo, you’ve got data, haven’t you, on this? How much the average person spends?

EDOARDO: A lot of money. I think Emma is famous for tracking all your subscriptions in one place, and it’s almost like one-in-two people that download the app, they see duplicate subscriptions running through their bank account.

PHILIPPA: And do you know what the average Brit spends every year? Take a guess on subscriptions.

CLARE: £500?

PHILIPPA: £696. This is the average Brit. You know, that’s £58 a month. But there are going to be people, looking at you Alex, who’re at the other end of the scale spending a lot more. And people like Edoardo, I presume, not spending anything. Do you’ve any subscriptions at all?

EDOARDO: Actually, I can show you because I’ve got them here in my pocket. I think I’ve got probably like 15 of them.

PHILIPPA: But it’s a thing, isn’t it? And there’s more and more and more of them and they all feel like things you have to have.

ALEX: I mean, one of the problems is that I’m paying to essentially rent things, I’m not actually - where is that money going? Am I actually purchasing anything? Not really.

‍

Being intentional and auditing your spending

‍

EDOARDO: But, like, because we talk about a lot of subscriptions as they’re like a bad thing. But, we forget that a pint in London costs like £7.70.

PHILIPPA: Oh, yeah.

EDOARDO: So sometimes it’s not even about the subscriptions, it’s about how you spend your money and how you live your life. The £9.99 can sound a lot, but the two pints at the pub is two months of a Netflix subscription, you know? So -

PHILIPPA: And this loops us back to that thing that Clare was saying about, you need to be intentional about it, which means you need to know that you’re doing it. So, I’m guessing the advice would be [to] audit what you’re spending, right?

EDOARDO: Of course.

CLARE: But if - I always say to people, if that coffee is what makes the difference, like if that’s the thing that you look forward to every day on your way to work and it makes the commute bearable and you savour every mouthful of it, then that’s - that spending is fine. If you can afford it, that spending’s fine.

If it’s just a habit and you pick it up and you often throw half of it away and you’re just doing it on autopilot, then that’s a waste. So, I think it’s about - you have to interrogate every one because what’s valuable to me isn’t going to be what’s valuable to you.

So, I think it’s about that. I wanted to go back to subscriptions just for one second. It was a really quick win that people can do, is that if you’ve got a partner, and I mean, this is, it’s really good to talk to your partner about money anyway, but please, please sit down and make sure that you’re not both subscribed to the same thing -

PHILIPPA: oh yeah -

CLARE: because me and my husband, like, we both had Netflix subscriptions. And at one point I think we both had like a Disney+ subscription and we have Sky, which includes Disney+. So, we were paying for it three times. So, I think if you can just sit down, that can be a really good, inciting conversation for a broader conversation about your finances. Obviously, we all know that people don’t really talk to their partner enough about money.

PHILIPPA: I already know I’ve got duplicate subscriptions with my husband, particularly things like Amazon Prime, because, and I just haven’t done anything about it. It’s like you saying, Alex, super organised at work and then your own personal life, somehow part of being in downtime is that you’re not quite as on it as you would be at work and stuff. But I’ve got better. I mean, do you not diarise when you do free trials with streaming services? You don’t stick it in your calendar because I do now, the cancellation date before I’ve to pay anymore.

ALEX: Oh, I completely overestimate my abilities to remember to shut something down for sure.

CLARE: But the other thing is that if you’re subscribing through Apple, so if it’s like an app subscription, you actually can cancel it immediately. So, you can subscribe and then cancel it immediately and you still get the full free trial.

PHILIPPA: Yes.

CLARE: So that’s a tip that I always give to people as well is just do it all in one motion. Subscribe, cancel, and then you just get the free trial, and you won’t get stuck in that subscription.

PHILIPPA: That’s a very good tip.

‍

The real pension cost of lifestyle creep

‍

PHILIPPA: It’s all very well, we’re laughing about this and saying, these are small sums. And as Clare rightly says, and as Edoardo rightly says, if they’re bringing you joy, for the price of a pint in London, then actually how bad is that? But the audit thing is important, isn’t it? Because if you’re thinking it doesn’t matter, it really, really does, doesn’t it? Because you talk to people all the time who’ve - this has got out of control. And all the money that’s leaching out of their budget into this could be feeding into savings and investments and of course pensions, couldn’t it?

ALEX: For sure. And I think at the moment with [the] cost-of-living crisis that we’re having, the fact that we’re all potentially spending money on things that if we’re not getting the benefit out of it, it’s worrying and it’s coming out every month and people will forget about it.

PHILIPPA: But say, I mean, if we put some numbers on it, say if we had someone in their 30s, And we’re going to be conservative here and say they’re just spending an extra £200 a month on what we might call ‘lifestyle creep’ or ‘lifestyle inflation’ rather than saving or investing it. Are we able to count that forward and see what that actually would cost them in terms of by the time they get to retire?

ALEX: Yeah. So, every personal contribution you make [as a basic rate taxpayer], the government tops it up by 25%, which is amazing. So, if you were to spend that money into your pension, you would get £50 tax relief on top of the £200, and over 30 years, let’s imagine you’ve got 8% growth. Let’s take some inflation off of 2.5%, and let’s say that you’re paying 0.7% in fees. It’d be around £200,000 extra in your pension, or £7,900 per year, and that breaks down to £660 per month in your retirement income.

PHILIPPA: I mean, it’s quite surprising, isn’t it, how those numbers stack up, because we’re only talking about extra £200 a month of discretionary spending you don’t need to do. And I think we’ve already established [that] a lot of us are doing more than that.

CLARE: One of the things that always really helps people to make good moves financially is making it really tangible. I think so much of this tends to be abstract. It tends to be this kind of, “Oh, I spend way too much on subscriptions,” or, “I can feel my lifestyle inflating”. But if you can make it really tangible. So doing direct swaps, and so this is how I incrementally started paying more into my pension, is I literally took the thing and cancelled the thing and immediately set up the direct debit straight into my pension. So, a direct swap of this thing that I’m not getting value out of versus this thing that I’m going to get so much value out of. You know, as you walk past the coffee shop, put the £4.50 straight into your savings or your investments or your pensions. Honestly.

EDOARDO: I’d be on the opposite spectrum of you.

CLARE: Really?

EDOARDO: Like if you don’t have an emergency fund, you shouldn’t spend your money. Set up savings, set up investing, then what’s left, you spend it. And if there’s nothing left, live a very humble life.

ALEX: It’s just a mindset though, isn’t it? I think it’s hard for people. I’d struggle to do that. Yeah, I’d find that really hard.

‍

How to cut back without making life miserable

‍

PHILIPPA: I mean, this is the point, isn’t it? Because I do want to talk about [it], I think we’ve all agreed it'd be good to stop this, or at least rein it in. But how do you do that without making your life feel really horrible? Because Edoardo is obviously someone with a huge amount of self-discipline, probably more than the rest of us. But we don’t want to make our lives a misery. I mean, I take your point, Edoardo. If you can’t afford to spend, don’t spend. The last thing you want is debt. And Clare knows all about this. She’s talked about it in the past.

EDOARDO: It goes back into priorities, right? Because what’s important to my life? Groceries, personal care, [a] tiny bit of entertainment. But eating out, doing takeaways, buying alcohol - these are all things that I think you can cut by 50% tomorrow if you want to.

CLARE: I disagree that those things are useless. So, I did, like you said, I had £27,000 worth of debt. And to put that into context, that was almost exactly my annual pre-tax salary at that point. Let’s not talk about how that was able to happen. That’s a whole other show, but -

PHILIPPA: But you were there, but it was -

CLARE: I was there and I paid it off over two years and I didn’t completely deprive myself and my family of all of those extras because always in the back of my mind was like, “I could get hit by a bus. I could make myself miserable, to pay off this debt in the minimal amount of time. And then I could get hit by a bus”.

And so, I trod a middle ground, and I ring-fenced some spending that was going to enable me to like to take my kids to Legoland while they were still little enough to enjoy it. And my eldest is 11 [years old]. He’s on his school’s residential [trip] at the moment and I can feel him slipping away. I can feel him slipping away towards his friends. And so, I’m really glad. I don’t care that it took me maybe three months longer to pay that off, and I didn’t care that it took me six months longer to fully fund my emergency fund. Like, I think you’ve to live your life.

PHILIPPA: A lifelong joy of that connection.

CLARE: Exactly.

‍

Building resilience and talking about money

‍

EDOARDO: We live in very unpredictable times. You know, you’ll lose your job, the rent might increase. There are so many things that might happen that if you’re already in a very bad situation, it’s better to sacrifice six months of your life to be back on track and then restart over than finding a middle ground. What if you get fired and you lose your job and you’re like £20,000 in debt? What’s going to happen?

CLARE: What insulates me from that fear is the fact that I’ve been through all of those things. I did have to leave my job when I was deeply in debt. My husband got made redundant when I was seven months pregnant. And we’re resilient, and we found a way through all of that, and, and we’re fine. So, I think [you should] absolutely do everything that you can. I’m not diminishing the importance of an emergency fund. That would, that would go against everything that I believe in.

I just think that find a way to ring-fence some stuff. And it might be a really small amount. It might be like your child’s swimming lessons, or it might be like enough to go for an ice cream every week. It doesn’t have to be like a big thing. I certainly wouldn’t be advocating for [things] like, “Go on the holiday of a lifetime because you’ll never get that time back”.

PHILIPPA: Sure.

CLARE: Also, crucially, they can make the difference between getting to the end of that journey of paying off your debt or building your emergency fund, or making yourself so miserable that you give up and you swing back in the other direction and you fall completely off the wagon. So, some of it isn’t even emotional or desirable or sentimental. Some of it’s just purely practical. There are a lot of people who just wouldn’t be able to carry on with that level of discipline.

PHILIPPA: Yeah, it has to be sustainable, doesn’t it? I mean, Alex, you talk to people all the time. I mean, I’m guessing quite a lot of them have a wake-up moment like Clare had when she suddenly thought, "OK, things need to change". What do they tend to be?

ALEX: For sure, we see sometimes people needing to withdraw in order to make purchases rather than to live on, which is worrying at the moment, yeah. And something that, you should try to make sure your pension is there for you to live on after you retire rather than to allow you to supplement an income currently.

PHILIPPA: Clare, you talked a bit about recovering from this debt mountain that you had. Did you do the basic things? I’m guessing you did, like, you reined back on where you bought your groceries and the things we’ve talked about earlier on.

CLARE: We did like a full, full audit and we did shop at a cheaper supermarket. We renegotiated any contract. We kept our old phones and went SIM-only, all of those things that we could. We cut out a lot of waste.

PHILIPPA: Did life feel grey and hard?

CLARE: No, I’d say, I think because I was documenting it, people knew that we were doing it, so it wasn’t -

PHILIPPA: Well, that brings me to the next thing, actually, that whole idea we talked about, other people can drag your spending up. But other people can also help you in this journey to reining it in, can’t they? Because it’s all about having conversations and the transparency can be really helpful. Yeah. I mean, you’ve got features, Edoardo, haven’t you, on your app about to help people have those conversations?

EDOARDO: I think so. But that’s one of the main problems with personal finance. People don’t like to talk about it.

PHILIPPA: Feels embarrassing, doesn’t it?

EDOARDO: Yeah, it feels a bit embarrassing. But obviously for couples, for example, we’ve got features where you can share each other’s bank accounts within the product. So essentially you can move both partners’ accounts in a single, like we call it ‘Space’, that you can access. And so, you can track each other’s spending. So, the problem of like double paying the Netflix at the same time, it goes away because you would see duplicate subscriptions right away, so -

PHILIPPA: so we need to really wrap this up now, but I’m going to, I’m going to say budgeting apps. These, I mean, everyone should be using these, right? I bet you don’t, Alex. You’re looking at me like a man who doesn’t use budgeting apps.

ALEX: No, I don’t.

PHILIPPA: Even tempted? By that help you rein stuff in.

ALEX: I think I just need to be more organised generally, just like outside.

PHILIPPA: They do it for you, don’t they?

ALEX: Yeah, that’s probably what I need, something that just organises it for me. The thing is, you get to the end of the day, and you just want to sit on the sofa. And this is why I spend all this money on all of these streaming services so I can sit on the sofa and enjoy them.

PHILIPPA: I mean, yeah, I get it. I do. I mean, there’s kind of, there’s a very, even if you don’t like technology, you don’t want to use apps, there’s basic frameworks.

‍

Budgeting frameworks and tools that work

‍

PHILIPPA: So, there’s the ‘50/30/20 rule’ Clare, talk us through it, how it works.

CLARE: Yeah, so the ‘50/30/20 rule’ dictates that 50% of your spending is on essentials, 30% on enjoyment, 20% on building your net worth. So, whether that’s paying off debt or whether it’s savings and investments, I’d say that the 50/30/20 rule is completely inappropriate for most people within this cost-of-living crisis. I think that most people’s essential bills are way higher than 50% of their income. But I do think that it’s a useful framework to work to that you can adapt.

PHILIPPA: So, if you play with the percentages.

CLARE: Yeah, exactly. So, let’s say your bills - and work from your essentials - so, let’s say that your bills are 70% of your income, then you maybe look at 15% and 15% or 20% and 10%. But I do think that’s very theoretical. You have to pair that with something like a budgeting app. I always say that budgeting, two-step process. There’s the plan and then there’s the tracking and monitoring. And most people never make it past the planning stage. So, they lay out this beautiful budget that really works on paper and then they don’t tie their budget to their actual spending.

EDOARDO: Interesting point. Obviously, I’m pro using budgeting apps, but the way that I budget is actually quite different from most of the people in the sense that I don’t set specific budgets. I simply look at the income and then the spend per month, and if I know that there is like a positive difference in between, I’m saving.

CLARE: Yeah.

EDOARDO: So, if the income is like, I don’t know, £2,000 net and the spend is £1,000 or £1,500, there’s £500 saved every month.

PHILIPPA: So, you’re not believing targets? You don’t want to -

EDOARDO: wow, you’re going to spend hours setting targets, you’re going to do all of that, and then you’re not going to follow through. So, it’s like, that’s eventually what happens to everyone, right?

PHILIPPA: Well, you say that, but I mean, I use tech to move money around so that it takes the decision part away. So, I set up my bank account so that a certain amount automatically disappears into my potential tax pot, [and] a certain amount disappears into other pots. And then the balance I see is the balance I can spend because the rest of it’s gone to those pots. I find that really helpful.

EDOARDO: And I think that’s the right way to do it.

ALEX: Yeah.

CLARE: And what you’re doing with that intentionally or not, is that you’re treating all of those things like saving for tax, saving for your pension, all of those, you’re treating them like another bill. And it’s kind of like, you know the Julia Donaldson book ‘A Squash and a Squeeze’?

So, it’s based [on] an old proverb, but it’s [a] farmer goes to whoever it’s, a local wise guy, and says, “Oh, my house is too small”. And he’s like, “OK, bring your chickens in, and then bring your cow in”. And then at the end he’s like, “Oh, it still just feels really small, but there’s loads of animals in here". And he’s like, “OK, so now just take them all out”. And suddenly his house feels enormous. And I think that if you do that, where you get yourself used to that lower amount of spending and that lower limit that you’ve, then if you do then want to increase it a little bit, you really feel the benefit of it.

PHILIPPA: Mind games.

CLARE: Yeah, exactly. Sometimes you’ve to gamify it for yourself.

PHILIPPA: Thanks everyone. I really love these episodes where we end up with a bunch of things people can do, don’t you? You know, the practical stuff you could actually take away.

If you found this episode helpful, please do rate and review it so that other listeners like you can find us. If you missed an episode, it’s not a problem. You can catch up anytime on your favourite app, or you can watch us on YouTube.

Next month we’re going to be discussing marriage. Is tying the knot actually worth doing from a money standpoint? We’re going to dig into the legal and financial ins and outs of saying I do or I don’t.

And here’s the disclaimer before we finish: please remember, anything discussed on the podcast shouldn’t be regarded as financial advice or as legal advice, and when investing, your capital is at risk. Thanks for being with us.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

On a Tuesday morning in Liverpool, Nigel, 76, opens his PensionBee app and checks the balance.

It's a habit he's developed since moving his pension to PensionBee around three years ago.

He says he checks it most days.

Not because he's worried about money. He just likes the reassurance that his pension’s in a good place.

Later that afternoon, he heads to orchestra rehearsal, where he plays the oboe. He first learned the instrument at school before picking it up again in retirement. On weekends, he cycles. In his early 50s, during a quieter period at work, he cycled 4,500 miles across America with a tent and backpack.

For more than 25 years, Nigel's life followed a familiar rhythm. Every morning, he caught the 6:20 train into central London. He built a successful career in technology consulting and eventually became a partner at his firm.

But like for many people, retirement always felt far away. His pension stayed in the background while work, family life and day-to-day responsibilities took priority.

"I would’ve liked to. I did plan to. But this came up and that came up," he says.

Looking back now, there are a few moments that shaped how he thinks about retirement and money.

Saving for retirement started as a practical decision 

Nigel first began paying into a pension in his early 30s after becoming a partner at his firm.

"It was partly tax-driven."

At the time, retirement still felt a long way off. He wasn't building towards a carefully calculated number or following a detailed financial plan. The decision was largely practical.

That's often how pension saving begins. It can start with a promotion, a conversation with an accountant or simply the feeling that it's probably time to put something aside for the future.

For Nigel, starting early turned out to matter more than having everything mapped out from the beginning.

Good to know: Basic rate taxpayers usually receive a 25% tax top up on personal pension contributions. That means for every £100 contributed, HMRC adds £25, bringing the total contribution to £125. PensionBee will claim this tax top up on your behalf if you're paying into a PensionBee plan. Higher and additional rate taxpayers can claim a further 25% and 31% respectively through their Self-Assessment tax returns

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‍Retirement arrived before he fully expected it

Nigel never worked out exactly how much he’d need for retirement.

"Was there a number I was aiming for? Did I know what that number should be?" he says.

"Looking back, yes, it would’ve been very easy to calculate. But I never answered that question for myself."

Eventually, retirement happened more through circumstance than planning.

"I've often said that I retired when nobody wanted me anymore."

Once work slowed down, Nigel began looking more closely at the numbers. He worked backwards from what he had saved and considered whether it would support the kind of retirement he wanted.

Looking back, he believes having even a rough sense of how long his savings needed to last would’ve helped him feel more prepared.

Good to know: Once you stop working, it helps to know roughly how far your savings can stretch. PensionBee's Drawdown Calculator can help you estimate how much you could take each month and how your pot might hold up over time.

The fees became harder to ignore 

Before moving to PensionBee, Nigel worked with an Independent Financial Adviser (IFA) and invested through an actively managed fund.

This was followed by a difficult period in the markets.

"I was shocked at the charges," he says.

"The markets hadn’t done well. I had an overall loss in one particular 12-month period, and I had to pay the fees for the active management, and I was paying the IFA."

"I looked at it and I just thought - this is silly."

Until then, the costs had felt relatively invisible. But when investment performance weakened, the charges became much more noticeable.

The experience changed how Nigel thought about managing his pension. He started looking for a pension that was easy to understand and manage.

Good to know: Pension fees can include platform charges, investment management fees and adviser costs. Over long periods, even small percentage fees can reduce overall returns. With PensionBee, you’ll pay between 0.50% and 0.95% depending on the plan you choose, and we'll halve the fee on the portion of your savings over £100,000.

Big life changes can affect retirement savings

At one point, Nigel mentions divorce.

"The pension pot was twice the size before I divorced," Nigel says.

He doesn't dwell on it, but the comment reflects something many people experience. Retirement savings are shaped by life as much as investment performance.

Career breaks, divorce, redundancy, caring responsibilities and periods of self-employment can all affect long-term savings plans.

For Nigel, those changes became part of the story of his pension, rather than something separate from it.

Good to know: Pensions are often one of the largest financial assets people own. During divorce settlements, pensions can sometimes be divided or shared depending on the circumstances. Find out more about how pensions are split in a divorce.

Drawing an income became part of his retirement routine 

Three years ago, Nigel moved his pension to PensionBee. Today, he’s in drawdown - taking a monthly income from the savings he spent decades building.

"I'm drawing effectively a monthly income," he says. "I get the equivalent from PensionBee of a payslip, with a tax deduction and the tax code."

The ability to withdraw flexibly matters to him. If he wants to fund a holiday, he can take a little more that month. If his tax bill is running high, he takes less.

The process is straightforward: a few regulatory questions, the amount he wants to withdraw and an estimate of the tax due. About 10 days later, the money lands in his bank account.

He also opens the app most mornings. Not from anxiety, but something closer to habit and reassurance.

"I have a kind of notional value in my head of what the pot needs to be worth to see me through," he says. "I get a little tense when I see it fall with the markets. But I get a sense of achievement when I see it going up," he says.

Knowing there’s one clear management fee, no hidden charges and clear investment choices helps too. After his experience with active management, he no longer feels his returns are being quietly eroded before he even sees them.

"I'm comforted by the fact that I'm not constantly worrying about the fees creaming off the top."

Good to know: From age 55 (rising to 57 in 2028), you can start drawing from your pension pot. With PensionBee, you can take one-off or set up Automatic withdrawals, with the flexibility to adjust the amount each month, helping you manage your income and tax position from year-to-year.

Retirement became a chance to rediscover old passions 

Nigel says some former colleagues struggled with the transition into retirement because so much of their identity had been tied to work.

"A lot of my colleagues always wanted to know, when they finished full-time employment, where they could find more work," he says.

"They never seemed to find it easy to break away from the idea that if you're not working, you're not valuable."

For Nigel, the adjustment felt more natural. By the time he retired, he already had passions outside work that gave shape to his time and routine.

"I walked away and I've never looked back."

Today, music and cycling remain an important part of his life. Retirement, he says, gave him more time to return to things he had always enjoyed but never fully prioritised during his working years.

Looking back now, Nigel doesn't describe his pension journey as perfect. He never set a precise retirement target, some financial decisions proved expensive and life events changed the shape of his savings in ways he couldn't fully control.

But he also started early, kept contributing and adapted when things no longer felt right for him.

At 76, he’s in control. He knows what's in his pot, what he draws each month and roughly what he needs it to do. For Nigel, retirement feels less like an ending and more like a different stage of life.

"Retirement is not the end of a journey," he says.

"Retirement is the next chapter."

The takeaway

Nigel’s pension journey wasn’t especially planned. Life intervened, fees became harder to ignore and divorce reshaped the savings he’d built over decades. But he started early, kept contributing and adjusted course when he needed to.

Now, at 76, retirement feels steady.He draws what he needs, changes it month-to-month and checks his app most mornings out of habit and reassurance.

There’s no perfect ending to the story. Just a sense that, over time, he’s arrived at something that works for him.

Hear more from Nigel and our other customers on our YouTube channel.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.

You might’ve seen the news that Elon Musk’s space exploration, communications, and AI company, SpaceX, publicly listed on the stock market on Friday 12 June.

Releasing a very specific 555,555,555 shares at $135 each, the company raised $75 billion from investors. That makes it the biggest initial public offering (IPO) in stock market history. 

When public trading started, share prices opened at $150, briefly reaching $176.50. In the end, they closed around $161, giving the company a remarkable value of $2.2 trillion. This performance made Musk the world’s first trillionaire.

It’s worth noting that the share price has since softened. By Tuesday 23 June, shares were back down to $151.90. That took more than $350 billion off Elon Musk’s net worth.

This is the first of some big tech company IPOs set to come in 2026. That includes OpenAI - the company behind ChatGPT - and Anthropic, the makers of Claude AI. 

So what does this mean for your PensionBee pension? 

In a nutshell, SpaceX won’t be included in any of PensionBee’s plans right now. However, that could change in future. 

Find out why, what’s happening across the market, and what might happen moving forwards.

SpaceX won’t be included in PensionBee’s plans for now

SpaceX won’t currently feature in any of the PensionBee plans. So, your pension savings won’t be invested in Musk’s company for the time being.

This isn’t particularly unusual for IPOs like this. Most stock market indices - essentially lists of specific groups of stocks, linked by things such as country or industry - don’t include newly-listed companies.

There’s normally a waiting interval - called ‘seasoning’ - before they’re added. This is typically between three to 12 months.

But some index providers have shorter wait times if companies meet specific criteria. That’s allowed them to include SpaceX in their indices sooner. 

Some of these indices even created new fast-tracking rules that mean they’ve been able to bring SpaceX into their lists within a matter of days.

Such indices are the:

• Nasdaq 100;
• Russell 1000 (and 3000); and
• Broad, total-market indices, such as the CRSP US Total Market Index.

However, the S&P 500 - an index of the 500 largest companies in the US, and arguably the leading index in the world - won’t include SpaceX.

To be included, companies need to have been listed for one year. They must also be profitable, posting positive earnings for their most recent quarter and the previous year. 

S&P Dow Jones, the provider behind the S&P 500, did discuss whether to change its rules to allow SpaceX in. But it ultimately concluded that they wouldn’t.

So, it’ll likely be at least a year until we see SpaceX included in any of the S&P indices. And it could be longer if it takes time for the business to turn a profit.

Will SpaceX be added to PensionBee’s plans later?

Whether SpaceX will be added to PensionBee’s plans in future depends on a couple of things. 

The index providers

PensionBee works with a few different money managers. That includes State Street and BlackRock.

Those money managers are speaking to the index providers to understand whether SpaceX will meet each providers’ criteria for inclusion.

That includes factors such as the seasoning period we talked about before. It also might be the ESG (environmental, social, and governance) credentials that companies may need to meet.

If these providers decide SpaceX is eligible for inclusion, it would likely be included in the next index rebalance. That usually means in the next few months. For the Global Leaders Plan, that’ll be August 2026. For the Tracker Plan and Shariah Plan, it’ll be September 2026. 

It’s still an emerging picture on the Climate Plan and the 4Plus Plan. We’ll share further updates when we have them. 

Your PensionBee plan

SpaceX’s inclusion will also differ between PensionBee plans. It’ll depend on elements such as the plan’s objective, what it invests in, and whether it meets the specific investment criteria of those plans.

For example, the Preserve Plan doesn’t invest in equities, so there’ll be no change.

But for the other plans, they may include SpaceX if it’s included in the indices and meets the criteria.

This is a developing and quite unusual situation, so for now, we don’t know exactly what’ll happen.

SpaceX would make up a small amount of your plan

It’s also worth noting that, even if SpaceX is included in your plan, it’ll make up a small amount of your total investments. 

That’s because of what’s called the ‘free float’ - the proportion of shares offered to public investors at the point of listing.

Founder-led companies like SpaceX often list with a lower initial free float. That allows the founders to keep control of most of the company, while limiting near-term market impact.

So, while SpaceX might be valued around $2 trillion, they've chosen to make about 4% of the shares publicly available. The rest are locked up and not tradeable.

This is a very small free float compared to other big tech companies in the major indices.

For the index providers, when deciding what percentage to allocate to each company, they’ll use a measure called ‘free float adjusted market capitalisation’.

For example, Nvidia's free float is 98%. That makes their free float adjusted market capitalisation around $5 trillion (as of June 2026). Whereas, SpaceX's free float adjusted market capitalisation is around $113 billion - far smaller.

Taking the MSCI World Index as an example, SpaceX would make up about 0.06% of the index weight. That’s compared to Nvidia at 5.64%. 

All in all, SpaceX may well have a trillion-dollar valuation when you consider all its shares. 

But, because so few shares are publicly available, the impact in our plans will be far less significant than it might first appear.

Save for your future with PensionBee

The PensionBee pension plans are built with simplicity in mind.

You can choose to stick with our default plans - that’s the Global Leaders Plan for under 50s, or the 4Plus Plan for over 50s. Or choose a specialist plan, such as the Climate Plan or Shariah Plan.

Find out more about our plans.

Risk warning

As always with investments, your capital is at risk. Past performance is not an indicator of future performance. The value of your investment can go down as well as up, and you may get back less than you invest. This information should not be regarded as financial advice.