Being self-employed can give you the flexibility and freedom you might have dreamt of from a traditional 9-to-5 role. But it also means you now have to take full responsibility for your retirement savings, as you won't have the convenience of a workplace pension or employer contributions. Therefore, you will need to plan your own solution to keep your retirement fund growing throughout your working life.

Read this guide for our top tips on how to build a strong financial future and retire comfortably.

Tip 1: Start Saving Early (and Stay Consistent!)

When you are in your twenties or even thirties, retirement seems like a distant dream. You might ask yourself why start now, when you have decades to build your pension?

The problem is that this can become your reasoning for most of your working life, especially if you are self-employed with a varied annual income. Starting your pension savings early will always be the best approach, as it will give your money time to benefit from compound growth.

Our two tips-within-a-tip:

  • Don't make the mistake of setting yourself a savings goal that is too high to sustain! Even just making small, regular contributions will add up over time and will keep you motivated to save.
  • We recommend setting up a direct debit payment with your pension provider so that you can automate your contributions. The earlier you start saving, the less pressure you will feel as you reach retirement age.

Tip 2: Choose the Right Pension for You

When employed by someone else, most times you get automatically enrolled into a workplace pension scheme, so you do not generally have a say in exactly what pension you have. Being self-employed gives you the freedom of choice, which can be both a blessing and a curse, depending on how indecisive you are.

Your main options are to either open a private pension or a self-invested personal pension (SIPP). Both are called personal pensions and let you choose the investment option that suits your risk tolerance and retirement goals.

You will get more control with a self-invested personal pension, as you can pick your funds or opt for a ready-made portfolio. If you prefer a more hands-off solution, you will probably gravitate towards a standard private pension.

Tip 3: Make the Most of Tax Relief

Pension contributions qualify for tax relief, which essentially means that the government adds money to your pension fund and reduces the amount of income tax you pay.

If you are a basic rate taxpayer, you will receive 20% tax relief automatically. If you are a higher-rate taxpayer, you may be able to claim more through your tax return (finally, a tax perk of earning more!).

The great thing about this is that it effectively boosts your retirement savings and maybe even allows you to retire early, without you having to put in the extra cash yourself. Just keep in mind that tax treatment depends on your personal circumstances, so definitely make sure to check the current rules before you start investing.

Tip 4: Don’t Forget Your State Pension

It is easy to get so caught up in our private pensions that we forget all about the state pension that most of us are entitled to.

As long as you have made enough national insurance contributions over 35 qualifying years, a state pension can form part of your retirement income. We say "part" because the pension really isn't that great, as it is currently £230.25 a week, which won't exactly give you the retirement of your dreams.

Make sure your records are up to date with HMRC. We recommend seeing this pension as a useful base to build on, rather than the only income you will need.

Tip 5: Use Other Savings Options

Contributing to a pension pot is not the only route you can go down to save for your retirement. You might also choose to open a Lifetime ISA for additional tax-efficient retirement savings. The government currently adds a nice 25% bonus on contributions of up to £4,000 a year, making it a simple way to boost your future fund.

Yes, you will need discipline to save for retirement when you work for yourself, which explains why many self-employed workers don't. But there is no arguing with the fact that the rewards can be worth it.