For many professionals across Berkshire, Hampshire and Oxfordshire, building a seven-figure pension once symbolised financial security. Reaching £1 million in retirement savings was considered a clear milestone — evidence of discipline, success and prudent long-term planning.
In 2026, however, a pension pot of this size may represent not certainty, but complexity.
Changes to pension legislation, evolving tax rules and increased flexibility in retirement income options have created a more nuanced landscape. While the abolition of the Lifetime Allowance removed one headline concern, it did not eliminate risk. In many respects, it has simply shifted the focus toward other technical planning challenges.
For high earners in Reading, Winchester, Newbury and Basingstoke — particularly those in senior corporate roles, professional partnerships or business ownership — seeking specialist pension planning advice in Berkshire has become increasingly important as retirement strategy grows more complex.
The Post-Lifetime Allowance Landscape
The removal of the Lifetime Allowance charge was widely welcomed. Previously, individuals exceeding the allowance faced punitive tax charges of up to 55% on excess funds. Its abolition reduced one barrier to continued pension saving.
However, several important constraints remain firmly in place.
The annual allowance still limits how much can be contributed tax-efficiently each year. For high-income individuals, the tapered annual allowance may reduce this further, meaning careful income planning is required even before retirement begins.
The Money Purchase Annual Allowance (MPAA) can also apply once flexible benefits are accessed, sharply reducing future contribution limits. For professionals who semi-retire, return to work, or continue consultancy arrangements, this can create unexpected restrictions.
Additionally, while the Lifetime Allowance charge has gone, limits on tax-free lump sums remain. The amount that can be taken tax-free is capped, and misunderstanding these rules can lead to inefficient withdrawals.
In short, complexity has not disappeared — it has evolved.
From Accumulation to Decumulation
For much of a professional’s career, pension planning focuses on accumulation: maximising contributions, achieving tax relief and compounding returns over time.
As retirement approaches, however, the conversation changes fundamentally.
A £1 million pension pot may generate substantial income — but how that income is structured can significantly affect long-term sustainability and tax efficiency.
Flexi-access drawdown provides flexibility, allowing retirees to withdraw varying amounts each year. While this freedom is attractive, it introduces sequencing risk. Drawing income during periods of market volatility can erode capital more quickly than anticipated, particularly if withdrawals are not carefully aligned with portfolio performance.
Without detailed modelling, individuals may:
- Withdraw too much in early retirement
- Trigger higher income tax brackets unnecessarily
- Deplete capital faster than intended
- Disrupt long-term investment strategy
For higher-rate or additional-rate taxpayers, large withdrawals can have knock-on effects, impacting dividend taxation, personal allowance tapering and even child benefit entitlements where relevant.
The Interaction with Other Assets
Many high earners in the Southeast hold more than just pensions. Investment portfolios, ISAs, rental property, business interests and taxable savings often sit alongside retirement funds.
The order in which these assets are accessed matters.
For example, drawing heavily from a pension while leaving taxable portfolios untouched may not always be optimal. In other cases, preserving pension assets — given their favourable inheritance tax treatment — may form part of a broader estate strategy.
Pension income also interacts with other revenue streams. Rental income from property in Berkshire or Oxfordshire, dividends from shareholdings, or consultancy earnings post-retirement can all combine to push individuals into higher tax bands.
Integrated planning across all assets is therefore essential.
Intergenerational Planning Considerations
Pensions have become powerful estate planning vehicles. In many cases, unused pension funds can pass outside of an individual’s estate for inheritance tax purposes.
However, the income tax position for beneficiaries depends on the age at death and how withdrawals are structured. Beneficiaries may face income tax at their marginal rate when accessing inherited pension funds.
For families with significant combined wealth — including property, investments and business assets — pensions now form a central component of intergenerational planning.
Questions increasingly include:
- Should pension assets be preserved and other investments drawn first?
- How should nomination forms be structured?
- Does the pension sit within a wider trust framework?
- How will beneficiaries access funds efficiently?
These are no longer niche concerns — they are mainstream planning discussions among affluent families.
Behavioural Risk and Overconfidence
Another challenge is behavioural rather than technical.
Reaching a £1 million pension milestone can create a false sense of financial certainty. Yet longevity risk remains significant. Many retirees will need their pensions to last 25–30 years or more.
Inflation, healthcare costs and lifestyle expectations can all increase spending over time. Without careful forecasting, even a substantial pension pot can face pressure.
In addition, market conditions in the early years of retirement can disproportionately affect long-term outcomes. This makes asset allocation, diversification and withdrawal strategy particularly important.
Why Specialist Advice Is Increasingly Important
A seven-figure pension is no longer uncommon among long-serving professionals in finance, law, medicine or business ownership. However, its management requires expertise that goes beyond basic retirement planning.
An independent financial adviser working alongside an experienced investment management team can help coordinate:
- Tax-efficient drawdown strategy
- Portfolio structuring aligned to income needs
- Risk management during volatile markets
- Estate planning integration
- Long-term cash flow modelling
The goal is not simply to preserve capital, but to optimise it — ensuring retirement income is sustainable, tax-efficient and aligned with broader family objectives.
A Milestone That Demands Attention
The £1 million pension remains a significant achievement. It reflects decades of disciplined saving and investment growth.
But in today’s regulatory and tax environment, it also represents a planning crossroads.
Without structured advice and careful modelling, high earners across Berkshire, Hampshire and Oxfordshire risk unintended tax exposure, inefficient withdrawals and missed estate planning opportunities.
The milestone itself is no longer the finish line. In many cases, it is where the real planning begins.