A better deal on pensions

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A few days I blogged about the delights of working over the Jubilee weekend in order to satisfy demanding (but very valued all the same!) clients – what I didn’t say was that all of those tasks were far more fulfilling than the other call of duty I finally got round to while the rest of the country was toasting Her Majesty.

That was to make a list of all the employee benefits I no longer enjoy having made the move to freelancing six months ago – and to make some plans for how I might replace the most important of them. At the top of the list is my pension because my retirement planning has been on hold since I became a deferred member of my last employer’s scheme.

I suspect that I’m not alone in the freelance world in putting pensions rather too permanently on the to-do list. Still, over the next few years, freelancers with no pension provision will become a smaller and smaller minority in this country’s working population.

New legislation that will be implemented in stages over the next six years will eventually require every employer in the country, no matter how small, to offer their staff access to a pension plan. Workers will automatically be enrolled into these plans – unless they specifically opt out – and their bosses will have to make a contribution on their behalf.

As freelancers, most of us are not going to be covered by these reforms. And while there are plenty of individual pension schemes through which we can make our own provision for old age – as well as a myriad of non-specialist saving and investment plans – there’s no way to replace the employer’s contribution on which we’ll miss out, other than out of our own pockets.

That prompts a couple of thoughts. First, it is incumbent upon freelancers to approach their pension planning with rather more urgency than I have been demonstrating over the past few months. And second, don’t we deserve a more generous system of tax reliefs than employed workers, many of whom are about to be given, for the very first time, a generous slug of pension contribution from their employers, courtesy of the Government’s reforms?

I’m not asking for more money in this age of austerity. But there surely must be a way to recast the various tax breaks already on offer to pension savers so as to offer a greater share of the cake to those of us who don’t have employers to contribute towards the cost of our old age.