There are around 8.42 million people in the UK working part-time. Their motivations may differ but all of them will see some impact on their long-term savings. Working and earning less generally means you end up paying less into your pension pot. Those who work for someone else might see less employer contributions going into their pension. While other part-time workers may be unknowingly jeopardising their eligibility for the full new State Pension.
According to the Institute and Faculty of Actuaries (IFoA), moving from full-time to part-time work can reduce your pension pot by up to £200,000. While this is on the more extreme end, even working part-time for a few years can take its toll on your nest egg.
But this shouldn’t mean you’re less able to save for a happy retirement. There are ways to ensure your working pattern today doesn’t mean you’re worse off financially tomorrow.
Workplace pensions and working part-time
The introduction of Auto-Enrolment has had a huge impact on the membership of workplace pensions. And part-time workers are part of this story too. If you work in the UK, are at least 22 years old (and aren’t yet State Pension age) and earn more than £10,000 per year, whatever your work pattern looks like, your employer is obliged to automatically enroll you. This should be happening without you needing to opt in, provided you aren’t already a member of a suitable workplace pension scheme.
If you earn less than £10,000, fear not – as long as you earn more than £6,240 per year you can request to be added to the scheme and your employer can’t refuse. For those earning less than £6,240, it could be beneficial to see what it’d take to get you to that threshold so you can take advantage of a workplace pension.
The minimum contribution under Auto-Enrolment is 5% of your qualifying earnings. Your employer is required to contribute at least 3% on top of this. This means that even as a part-time worker (if you meet the earnings threshold) both you and your employer will contribute towards your retirement savings. Plus, those contributions will be eligible for tax relief. Most UK taxpayers get tax relief on their pension contributions, which means that the government effectively adds money to your pension pot. If you’re a basic rate taxpayer, you’ll get a 25% tax top up. In real terms, this means HMRC adds £25 for every £100 you pay into your pension making the total contribution £125.
What about the State Pension?
The State Pension is a regular payment from the government that you can claim when you reach 66 (rising to 67 from 2028). You can check your State Pension age using PensionBee’s State Pension Age Calculator.
Whether or not you can claim it and the amount you receive depends on your National Insurance (NI) record throughout your working life. To qualify for the full new State Pension, you need 35 years of NI contributions. While a minimum of 10 years is required to receive any State Pension.
Part-time workers may earn less, potentially affecting their NI contributions. For the 2025/2026 tax year, most employees need to earn at least £242 per week to make NI contributions. If your earnings fall below this threshold, you may not accrue contributions for that period, which can impact your State Pension entitlement.
You can use gov.uk to check your State Pension forecast and see how much you’re on track to earn, as well as the estimated date you can start claiming it. You can also see how many years of full contributions you’ve made so far. If you find missing years, you have the option to make voluntary NI contributions to fill these gaps.
5 ways to boost your pension savings if you work part-time
1. Make sure you’re in the workplace pension scheme
If you earn between £6,240 and £10,000, there’s a chance you could fall between the cracks when it comes to your workplace pension scheme. If this is you, speak to your employer about getting enrolled. It’s your opportunity to get pension contributions from your employer.
2. Make additional NI contributions
If you’re not quite on track to qualify for the full new State Pension, see if you can make those extra NI payments now. If you’ve missed a number of years because of caring for children or other family members, perhaps your partner can help you to make these extra payments.
3. Claim carer’s credits
If you’re working part-time because you’re caring for either children or another family member you might be eligible for financial support. As long as you’re caring for a minimum of 20 hours a week, you can claim extra NI credits to fill any gaps in your record. You can check your eligibility and find out how to claim at gov.uk.
4. Maternity leave payments
If you’re still getting paid by your employer while you’re on maternity leave, they’ll need to continue paying into your pension. If you’ve stopped being paid, they’re still obliged to pay contributions for the first 26 weeks of your leave. If it’s past 26 weeks, it might be worth investigating your employer’s maternity policy to see if you can ask them to continue to contribute. MoneyHelper has a great guide on parental leave and pension contributions which is well worth checking whatever your situation.
5. Third party pension contributions
If you’re married, your spouse could pay into either your workplace or personal pension plan on your behalf. In fact, in many cases it doesn’t have to be your partner – check with your pension provider who and how third parties can contribute for you.
People come to work part-time for myriad reasons. Perhaps full-time options weren’t available, or you’re at home caring for a family member. Maybe you need to work less because of your health. Whatever the reason, you don’t want it to be a cause of anxiety when you think about your pension.
Take some time to understand the relationship between your working hours, earnings, and pension contributions, so you can make a plan of action. Speak to your employer (if you have one), your pension provider and seek government support if you think you might be eligible. With these steps, you’ll be able to boost your pension savings and look forward to a happy retirement, regardless of your working pattern.
Gabriella Griffith is a Freelance Business Journalist having worked across The Times, Sunday Times, The Telegraph and City AM. She also hosts the Find Your Business Voice podcast and co-hosts the Big Fat Negative podcast. She has a particular passion for start-up and SME stories, personal finance and women’s health.
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.
