Second pensions

You can build up a second pension (on top of your basic State Pension) through the state, or by a private arrangement of some kind.

Additional State Pension (SERPS and State Second Pension)

• The additional State Pension was called the State Earnings-Related Pension Scheme (SERPS) until 6 April 2002 . SERPS was based on your record of National Insurance contributions and your level of earnings as an employee. The additional State Pension you can build up from 6 April 2002 is called the State Second Pension. The State Second Pension is the Government’s reform of SERPS to provide a more generous additional State Pension for employees on low or moderate earnings, and certain carers and people with a long-term illness or disability whose working lives have been interrupted or shortened.
• For more information on state pensions, please see State pensions – Your guide (PM2).

Private pensions

There are a number of different private pension options for you to consider.

• Occupational pensions – set up by employers for their employees.
• Stakeholder pensions – these are low-charge, flexible pensions. Since April 2001, most employers must provide their employees with access to a stakeholder pension. If your employer is exempt, or you want to get your own stakeholder pension, you can also get them from a range of financial services companies and other organisations, such as trade unions.
• Personal pensions – you usually get these from financial services companies, such as insurance companies, banks, investment companies and building societies.

For more information, please see Occupational pensions – Your guide (PM3); Stakeholder pensions – Your guide (PM8); and Personal pensions – Your guide (PM4).