Should you sacrifice your salary for a bigger pension?

With employers’ National Insurance set to rise, salary sacrifice is becoming an increasingly popular means of reducing tax and maximising pension contributions

A man in a kitchen examining his payslip reviewing salary sacrifice for his pension
Is salary sacrifice the right option for you? It could help boost your pension (image: Getty Images)
(Image credit: sturti via Getty Images)

Salary sacrifice can be one of the most effective means of boosting your personal wealth, and it could be worth seriously considering especially if you’re wondering how to spend your annual bonus.

The thing that makes salary sacrifice such a powerful savings tool is that it reduces the amount of income tax you pay on your earnings, meaning you get more bang for your buck. Salary sacrifice is most often used to increase pension contributions, but it can be used for a variety of benefits.

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Dan McEvoy
Senior Writer

Dan is a financial journalist who, prior to joining MoneyWeek, spent five years writing for OPTO, an investment magazine focused on growth and technology stocks, ETFs and thematic investing.

Before becoming a writer, Dan spent six years working in talent acquisition in the tech sector, including for credit scoring start-up ClearScore where he first developed an interest in personal finance.

Dan studied Social Anthropology and Management at Sidney Sussex College and the Judge Business School, Cambridge University. Outside finance, he also enjoys travel writing, and has edited two published travel books.