Why self-employed beauty pros should invest in a pension

Published 28th Mar 2024

If you’re self-employed and not currently contributing to a pension, you might be wondering if the state pension will be enough – here's what you need to know.

The current full state pension for 2024/2025 is £221.17 per week – however, your state pension entitlement will normally be based on your own national insurance contributions.

How do I get a state pension?

To receive any state pension at all, you'll need to have made or been credited with at least 10 years of qualifying contributions on your national insurance record.

To receive the full state pension, it requires 35 years of qualifying contributions or credits. 

If you have more than 10 but less than 35 years of qualifying contributions then you will receive a proportionate amount, with each qualifying year providing 1/35th of the full amount.


  • 35 years gives 35/35 x £203.85 = £203.85 a week
  • 30 years gives 30/35 x £203.85 = £174.73 a week
  • 10 years gives 10/35 x £203.85 = £58.24 a week

You can check your national insurance record online by visiting gov.uk/check-national-insurance-record

It is very important to note that relying solely on the state pension may not provide the desired standard of living in retirement.

Taking proactive steps to save, invest and plan for retirement will help ensure a more financially secure and fulfilling future.

What are the benefits of self-employed pensions?

Pensions for self-employed individuals offer a solution to this problem, whether you're a nail tech, brow artist, mobile therapist or any other self-employed beauty professional. Contributing to a self-employed pension can also offer several benefits:

  1. Tax relief on contributions – when you contribute to a self-employed pension, you can claim tax relief on your contributions.
    This means that the Government adds money to your pension pot based on your tax rate.
    For example, if you are a basic rate taxpayer, for every £80 you contribute, the Government adds £20, making a total contribution of £100.
  2. Tax-free growth – the money you contribute to your self-employed pension grows tax-free.
    This means that any investment gains or interest earned within your pension pot are not subject to income tax or capital gains tax.
  3. Tax-free lump sum – when you reach the age of 55 (rising to 57 from 2028), you can typically take up to 25% of your pension pot as a tax-free lump sum.
    The remaining amount can be used to provide a regular income in retirement, which will be subject to income tax.
  4. Lower taxable income – by contributing to a self-employed pension, you can reduce your taxable income.
    This can potentially lower your overall tax liability and may also help you avoid higher tax brackets.

It's important to note that there are annual limits on pension contributions, so it's advisable to consult with a financial adviser or tax professional to ensure you make the most of the tax benefits available to you.

Tina Renshaw is a financial adviser and the owner of Renshaw Financial Planning but was previously an award-winning nail technician and nail educator.

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