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Balancing pensions and mortgages

Taking out a mortgage can be both exciting and daunting. For many of us, it's the biggest financial commitment we’ll ever make – but one that can balance well with pension contributions.

Why should I balance a pension with my mortgage?

  1. A mortgage gives you the security of owning your own home while a pension pot can help you get an income in later life. By balancing the two, you'll have peace of mind now and in the future.
  2. You'll benefit in so many ways if you keep saving with a pension while managing a mortgage. If you're eligible, your pension pot will not only be boosted by employer contributions but also by the extra money you get from tax relief every time you contribute. For example, every £1,000 you pay into a pension scheme will have £250 basic tax relief added to it. Higher rate taxpayers can claim additional tax relief through their tax return, although this is paid back directly and not into the pension scheme.

    As any investment returns received on your pension savings are reinvested then over the long term this can help to increase your pot even more. So just remember - the longer you pay into your pension scheme, the more time your money has to grow.

Find a balance that works for you

Whatever you choose to do when it comes to pensions and mortgages, it’s your decision. While saving with a pension is a worthwhile investment in your future, ultimately it’s all about what works for you. But remember, it doesn’t always need to be a question of choosing one over the other.

Help and advice

There are plenty of resources that can help you balance your finances.

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Free budget planner

The Money Advice Service's budget planner makes it easier to stay in control of your household spending and money.

Use the budget planner

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Getting guidance and advice

Feel confident about your finances by knowing where to find the information that’s most useful to you.

Where to find support

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Log in to your online account

You can check how much is in your retirement pot, change your contributions and much more by logging in to your online account.

The money midlife MOT

The money midlife MOT helps you look at your current finances and plan for the future. It works best for people between the ages of 45 and 65.

Take the money MOT