Pensions are the most important financial product most people will ever have and the one they understand least. The changes taking effect in 2025 and 2026 make this the moment to get informed — and to act.
State Pension Increase
The state pension rises by 4.1% this year under the triple lock, taking the full new state pension to £11,542 per year. This remains insufficient for a comfortable retirement for most people, but it provides a meaningful foundation.
The triple lock — which guarantees the state pension increases by the highest of earnings growth, inflation, or 2.5% — is under political pressure. Both major parties have made commitments to it, but the fiscal cost grows every year, and the commitment will face a serious test in the next spending review.
Auto-Enrolment Expansion
From 2026, auto-enrolment will extend to workers aged 18–21 (currently excluded until 22) and to those earning from the first pound of earnings (currently the lower earnings limit means only earnings above £6,240 are pensioned). These changes will bring an estimated 3.7 million additional workers into pension saving.
Pension Tax Relief
No changes to pension tax relief were announced in the Autumn Budget — but the issue has not gone away. The current system, which provides relief at the marginal rate, disproportionately benefits higher earners. Reform toward a flat rate of 25–30% is regularly discussed and may feature in future fiscal statements.
