# Salary sacrifice

Billy is 26 and earns £24,000. He plans to retire at 65. He’s currently contributing 5% of his salary, and his employer is contributing 3%.

Billy is considering increasing his contribution to 7% because if he did, his employer would contribute 4%. Look at the difference this could make to Billy over 39 years.

 Total cost to Billy Total tax savings Total employer contributions Total potential growth Total estimated pot value 5% contribution £31,824 £14,976 £28,080 £111,672 £186,552 7% contribution £44,554 £20,966 £37,440 £153,548 £256,508

We've based the figures on a 20% rate taxpayer with 12% National Insurance contributions. If you pay tax in Scotland or Wales, your figures may differ. The figures don't take into account changes to tax rates, tax bands or pay rises. Tax savings will depend on your circumstances and rules can also change. The figures don't take inflation into account which means the purchasing power of your fund value will be reduced in future. The figures assume 5% growth each year and an annual management charge of 0.75% each year. Actual charges may differ. Charges can vary in the future and may be higher than they are now. The value of your investment can go down as well as up and you may get back less than you put in.

Go to our Retirement contributions calculator if you'd like to work out your own figures.

Emily is 34 and earns £28,000. She wants to retire at 65. She chooses to pay 4% of her salary into her pension, and her employer is matching her contribution.

However, if Emily was to increase her contribution to 5%, her employer would also match this. Look at the difference it could make to Emily over 31 years.

 Total cost to Emily Total tax savings Total employer contributions Total potential growth Total estimated pot value 4% contribution £23,610 £11,110 £34,720 £71,689 £141,129 5% contribution £29,512 £13,888 £43,400 £89,612 £176,412

We've based the figures on a 20% rate taxpayer with 12% National Insurance contributions. If you pay tax in Scotland or Wales, your figures may differ. The figures don't take into account changes to tax rates, tax bands or pay rises. Tax savings will depend on your circumstances and rules can also change. The figures don't take inflation into account which means the purchasing power of your fund value will be reduced in future. The figures assume 5% growth each year and an annual management charge of 0.75% each year. Actual charges may differ. Charges can vary in the future and may be higher than they are now. The value of your investment can go down as well as up and you may get back less than you put in.

Go to our Retirement contributions calculator if you'd like to work out your own figures.

Les is 41 and earns £35,000. He wants to retire at 65. He’s currently paying 3.5% of his salary into his pension, and his employer contributes 4.5%.

Les is considering increasing his contribution to 5%, as by doing so, his employer’s contribution would go up to 6%. Look at the difference it could make to Les over 24 years.

 Total cost to Les Total tax savings Total employer contributions Total potential growth Total estimated pot value 3.5% contribution £19,992 £9,408 £37,800 £47,877 £115,077 5% contribution £28,560 £13,440 £50,400 £65,831 £158,231

We've based the figures on a 20% rate taxpayer with 12% National Insurance contributions. If you pay tax in Scotland or Wales, your figures may differ. The figures don't take into account changes to tax rates, tax bands or pay rises. Tax savings will depend on your circumstances and rules can also change. The figures don't take inflation into account which means the purchasing power of your fund value will be reduced in future. The figures assume 5% growth each year and an annual management charge of 0.75% each year. Actual charges may differ. Charges can vary in the future and may be higher than they are now. The value of your investment can go down as well as up and you may get back less than you put in.

Go to our Retirement contributions calculator if you'd like to work out your own figures.

Phil is 50 and earns £58,000. He wants to retire at 65. He’s currently contributing just 5% of his salary into his pension, and his employer is matching his contribution.

However, if Phil was to increase his contribution to 10%, his employer would also match this. Look at the difference it could make to Phil over 15 years.

 Total cost to Phil Total tax savings Total employer contributions Total potential growth Total estimated pot value 5% contribution £25,230 £18,270 £43,500 £33,708 £120,708 10% contribution £50,460 £36,540 £87,000 £67,417 £241,417

We've based the figures on a 40% rate taxpayer with 2% National Insurance contributions. If you pay tax in Scotland or Wales, your figures may differ. The figures don't take into account changes to tax rates, tax bands or pay rises. Tax savings will depend on your circumstances and rules can also change. The figures don't take inflation into account which means the purchasing power of your fund value will be reduced in future. The figures assume 5% growth each year and an annual management charge of 0.75% each year. Actual charges may differ. Charges can vary in the future and may be higher than they are now. The value of your investment can go down as well as up and you may get back less than you put in.

Go to our Retirement contributions calculator if you'd like to work out your own figures.

One of the benefits of your pension scheme is that your contributions are flexible. You can contribute as much as you like into your pension, although the total amount of tax relief you get on your pension savings is limited.

#### Auto-enrolment

Auto-enrolment is a UK Government initiative aimed at helping more people save for the future through a workplace pension.

#### Investment choices

As your pension is an investment, the value can go down as well as up and you might get back less than you put in.

During your working life, it's important to consider your retirement and the ability to enjoy life when you reach retirement. Saving into your workplace pension could help you do just that.

#### Tax efficient

The money you save into your pension comes from your salary. There are different ways to make your contributions and they impact the tax savings you make.