8 simple steps to boost your nest egg . . .

1. JOIN YOUR COMPANY SCHEME

MOST workers will be automatically enrolled into their company pension scheme.

You can opt out — but then you’ll just be missing out on ‘free’ money.

Better f i rms will match the amount of contributions you put in. For example, if you pay in 5 pc of your salary, your employer will too.

Also, the Government will top it up with tax relief.

Check what your employer offers and whether you are making the most of i t. By i ncreasing your monthly contribution, you could get more from your employer, too.

John Lawson, head of retirement solutions policy at Aviva, says: ‘never miss a chance to get “free” money. Pay into your pension what you need to get the maximum employer contribution.’

2. START SAVING AS SOON AS POSSIBLE

The sooner you put money away, the harder it will work for you in the long run, even if it is just small amounts to start off with.

For example, if you invest £100 and it grows at 6 pc each year, after ten years it is worth £179, after 20 years it is worth £321, after 30 years it is worth £574 and after 40 years it has grown to £1,029.

Patrick Connolly, of independent financial adviser Chase de Vere, says: ‘Although it may seem like a long way off, the sooner you start saving, the easier i t will be to give yourself a more comfortable lifestyle in retirement.

‘even if you cannot afford to save much initially, it is better to do something than nothing at all.’

3. PAY MORE IN IF YOU GET A PAY RISE

TO AVOID inflation eating into your savings, you need to increase your contributions as you get older. Most company schemes calculate contributions as a percentage of your salary, so the amount will increase over time in line with your pay.

But to really boost your pot, it’s a good idea to increase your contribution level whenever you get a pay rise. That way, you can boost your savings without seeing your takehome pay fall. Craig Palfrey, of financial adviser Penguin Wealth, says: ‘ Pension saving is a long-term strategy. Using pay rises to keep topping up your saved amounts is a manageable way of affording the regular increases that are needed to boost your retirement fund.’

4. TAKE MORE RISKS WHEN YOU’RE YOUNG

The higher the risk, the greater the potential returns. But when you’re approaching retirement, you don’t have much time to make up any losses if some of those risks don’t pay off.

Your early years of saving are therefore the best time to invest in riskier funds as you can ride out the peaks and troughs of the market.

Peter Chadborn, of essexbased financial adviser Plan Money, says: ‘If time is on your side you can tolerate wild swings in the stock market. With regular monthly contributions, this volatility can even work in your favour.

‘This is because you can buy more units for your money when share prices are low. It is better to buy £100 worth of shares each month over ten months than to buy £1,000 worth in a lump sum, as you have a better chance of buying shares at a low price.’

5. PICK YOUR OWN FUNDS

CHECK how your savings are invested. They might be in a ‘default’ fund — one which was automatically selected for you at the beginning.

Julie hutchison, a consumer f i nance expert at pension provider Standard Life, says: ‘You may be in a default or in funds you selected years ago. either way, take a look and see if the funds suit your needs.’

It is also worth checking what fees you pay, as the annual management charges that fund managers apply vary and could eat away at your savings.

6. CHECK YOU QUALIFY FOR THE FULL STATE PENSION

FIND out what state pension you are entitled t o and whether you can boost it by making extra contributions. The Government is introducing a new flat-rate pension from next April, so if you are approaching retire ment make sure you understand how any changes affect you.

You can get a forecast of the amount of state pension you’ll get from the department for Works and Pensions.

Currently, you need 30 years of full national Insurance contributions to qualify for the full basic state pension. To qualify for the new full state pension, you will need to have at least 35 years of national Insurance contributions.

7. TAKE INDEPENDENT ADVICE

MANY of us don’t have the time or expertise to carry out regular reviews of how their pension funds are performing, so you may decide to pay a professional financial adviser to do this for you.

An adviser can also discuss when you want to retire and how much you’ll need to live on — and make a plan for how to get there. According to Unbiased.co.

uk, advice on an £ 80 per month pension contribution typically costs £500, but most people will make back the c ost of advice t hrough improved i nvestment performance and tax savings.

You can also find a financial adviser who is based near you at unbiased.co.uk.

8. AND THERE IS EXTRA INCOME IN RETIREMENT

MANY savers miss out on hundreds of millions of pounds worth of extra cash every year by signing up to the wrong kind of annuity.

While annuities — which pay out an income for life — have become less popular following the pension freedoms, an annuity may still be the right choice for at least part of your pension pot.

If you have medical issues, you can get a higher income i n retirement by taking an ‘enhanced annuity’. The most common condition that people declare is high blood pressure, followed by obesity, diabetes and high cholesterol, according to Partnership. Around 32 pc of annuities sold in t he first three mont h s of new pension freedoms were enhanced. Many more will stand to benefit f rom better annuities simply by shopping around.