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Retirement savings products available for the self-employed

Personal Pensions

Personal Pensions are a type of defined contribution (DC) scheme and are available from a wide range of financial institutions. What an individual gets in retirement will depend on the contributions they have made, tax relief and any investment growth. The main types of personal pensions currently available on the market are:

  • Stakeholder pensions: these pensions must meet minimum standards set by the government, and offer a default investment fund for people who do not want to choose the fund themselves. Charges are capped at 1.5% per year for the first 10 years and 1% thereafter, and transfers are charge-free.
  • Self-invested Personal Pensions (SIPPs): These provide wider investment powers and a broader range of assets. They are designed for people who want to manage their own investments, or are happy to pay an authorised investment manager to help make investment decisions on their behalf.

Individual Savings Accounts (ISAs)

Individual Savings Accounts (ISAs) allow people to save up to £20,000 per year without paying tax on investment growth. You can save the full amount in one type of account or split the allowance across some or all of the other types. There are 4 types:

  • Cash ISAs
  • Stocks and shares ISAs
  • Innovative finance ISAs
  • Lifetime ISAs

Cash ISAs, stocks and shares ISAs and innovative finance ISAs differ according to the assets that can be saved within them.

The Lifetime ISA (LISA) was launched in April 2017 with the aim of supporting younger people to save. Adults under 40 are able to open a Lifetime ISA and can contribute up to £4,000 a year until the age of 50, receiving a 25% bonus from the government on contributions. Savers can access their funds under three circumstances: from age 60, in order to buy a first home worth up to £450,000 nationwide, or if terminally ill. There is a 25% government charge on all other withdrawals.

As 42% of the self-employed are over 55, the LISA isn’t a viable option for the many of the self-employed. However, it could be an option for younger self-employed people.


From March 2018, the National Employment Savings Trust (NEST) has a public service obligation to accept any self-employed person who wishes to use the scheme. NEST is the workplace pension established by Government to support the roll out of automatic enrolment and it also has a pension investment option for the self-employed. Individuals register online and can make contributions as frequently as they choose, subject to a £10 minimum contribution at each deposit.

Other providers

In addition to NEST, the products described are provided by a variety of banks, building societies, credit unions, friendly societies, stock brokers, peer-to-peer lending services, crowdfunding companies, insurers, platforms and other financial institutions.