Pensions have a reputation for being arcane and complicated, and there are elements of the pension system which can be hard to get your head around. But when you boil it down, a pension is simply a tax efficient investment plan. Here are five levers you can pull to boost your retirement savings.

1. Increase contributions

The more you put into your pension, the more you will get out. But you don’t necessarily have to do all the heavy lifting yourself.

If you’re employed, your employer is obliged to pay into a pension on your behalf, usually on the provision you make some contributions yourself.

Often a company will match your contributions up to a certain level, for instance offering to pay 6% of your salary into a pension provided you pay in 6% too. Try and contribute enough to get the maximum from your employer.

2. Spend more time saving

Starting contributions earlier gives more time for them to grow, and also means more money going into your pot overall.

Clearly this is something to action at the beginning of your pension saving journey. But even if you’re mid-way through, you can still give your pension more growth potential by retiring a bit later.

If you’ve hit retirement without as much as you’d like in your pension, you might want to consider working for longer. Many people are now phasing their way into retirement as an active choice, not just to give their pension a boost, but to keep actively engaged in the workplace too.

3. Improve pension performance

Contributing more, starting early or retiring late are all quite laborious ways to boost your pension. You have to put your hand in your pocket, one way or another.

There are other pension levers you can pull that require a bit of attention, but no hard cash.

Improving performance is one such device. If you invest £5,000 a year in a pension, after 30 years it would be worth £349,000 if you get 5% growth, £505,000 if you get 7% growth, and £743,000 if you get 9% growth.

So, improving performance can be quite a powerful lever to pull when it comes to boosting your pension, without actually having to commit more money. There are fundamentally two ways you might do this.

The first is to take more risk with your pension investments. Generally speaking, the higher the risk profile of your portfolio, the greater the long-term rewards should be. The thing about risk is that sometimes it comes home to roost, and returns are consequently disappointing.

At the very least you should expect a choppier ride by taking more risk, even if it does ultimately yield better results. If you’re uncomfortable taking more risk, then you should leave this lever alone. It’s important to be able to sleep at night.

Many people are in a position to take more risk with their workplace pension because they are shunted into a default fund, which is usually medium risk because it has to be appropriate for the workforce as a whole.

That might be fine for some, but if you’re more adventurous, or still some way to retirement, you might well consider dialling up the risk by investing more in shares, and less in cash and bonds.

As well as risk, you can improve returns by backing active fund managers that perform well.

Some would say there’s no point whatsoever in picking active funds, and simply tracking the market is a better approach.

That’s a legitimate viewpoint, and it’s certainly true there’s no way of guaranteeing in advance that a given fund manager will beat the market. But the longer a fund manager has delivered outperformance, the more likely this is a result of skill rather than luck.

It still doesn’t ensure outperformance going forward, but by pulling together a portfolio of such managers, you give yourself a good chance of improving the performance of your pension, especially compared to some of the very weak active management that is often found in pension funds.

4. Reduce charges

A further factor that will affect the final size of your retirement pot are the pension charges you pay. These can come in two main forms, fund management fees and the pension wrapper or platform charges.

Often these two can be bundled together in one charge, especially in workplace pensions. You might therefore be able to reduce charges by moving to a cheaper fund or a cheaper platform.

The savings you make might seem small, but because they build up year in year out, they can add up over time. If you get gross investment returns of 7% over 30 years, your pension would be worth £419,000 if charges add up to 1% a year, or £460,000 if they come in at 0.5% per year.

5. Play smart with withdrawals

The last major lever you can pull comes when you draw your pension, and there are a number of things you can do to boost your income at this juncture.

If you’re buying an annuity, it’s essential to shop around for the best rates, as you’ll be locking into this income stream for life.

Also consider whether you might want to keep some of your pension invested for the long term, generating income and growth into your later retirement years.

Finally, pension withdrawals are now largely flexible, unless you’re lucky enough to have a final salary scheme, so manage those withdrawals to minimise the tax you pay, by trying to stay under thresholds that would push you into a higher rate of income tax.

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