Seven jobs with the best pensions – and how much they could earn for your retirement
If you’re considering a career change soon, your main priority might be a better salary. With the cost of living and inflation rising, this is understandable.
However, pension benefits are another important factor that can have a significant impact on your financial future. For example, one of the main benefits of working in some industries is having access to a good pension plan.
And having a good pension matters. For example, compare these two simple calculations – not taking into account fees or market performance – for modern workplace pensions:
- If your salary is £40,000 and your employer is paying 12 per cent towards your workplace pension, it would be worth £8,500 a year when you contribute five per cent and you include basic rate tax relief. That’s £85,000 over 10 years.
- However, a bigger salary of £45,000 with the minimum employer contribution of three per cent would only deliver a workplace pension worth £4,500 per year including your five per cent contribution and basic rate tax relief. That’s only £45,000 after 10 years.
- Overall, the job paying the higher salary may offer negligible long-term financial benefits when you take the pension into account.
But which jobs offer the best pensions? Careers in the public sector, military, financial services, and government roles offer some of the best pension schemes in the UK.
With employer contributions ranging from 10 per cent to over 50 per cent, these jobs can help you build a much bigger pension pot to maximise your income during retirement.
This list is selected based on employer contribution rates, scheme generosity – such as whether it’s a defined benefit (DB) pension offering guaranteed income – and long-term value. While public sector pensions typically offer the highest employer contributions, some private sector jobs, such as those in financial services, also offer generous workplace pensions.
Where possible, we’ve included how much a pension would be worth annually according to the respective publicly available data, based on a salary of £37,000 – the median earnings for employees in the UK last year.
NHS employees
The National Health Service (NHS) offers one of the most generous pension schemes of any organisation in the UK, which comprises defined benefits based on career earnings rather than investment performance. This type of pension is now very rare in the private sector.
According to the British Medical Association (BMA), the average employer contribution rate during the scheme in April 2024 was:
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- 23.7 per cent in England and Wales
- 23.2 per cent in Northern Ireland
- 22.5 per cent in Scotland
NHS employees pay between 5 per cent and 14.5 per cent during the scheme, depending on their salary (the higher the salary, the higher the contribution).
An NHS employee with 40 years of service earning an average salary of £37,000 would retire on a pension of just under £22k per year, based on contributions to the 1995, 2008 and 2015 schemes.
Employers contribute 28.6% of a teacher’s salary to the Teachers’ Pension Scheme (TPS) in England and Wales. In Scotland, contributions are slightly lower at 26%.
The TPS is also a defined benefit scheme, which means teachers receive a guaranteed pension based on their earnings and length of service.
A teacher who retires after 40 years of service with an average salary of £37,000 might expect an annual pension income of about £19,000 to £20,500.
Military employees
The Armed Forces Pension Scheme (AFPS) is non-contributory for active service members, which means the government covers the full cost of the pension. This is one of the best pension schemes available; employers were expected to contribute up to 73.5 per cent of all pensionable pay from April 2024.
Military personnel receive either a final salary or career-average pension, depending on their service length and the scheme they fall under.
A retired armed forces employee who earned a salary of £37,000 could receive a pension worth up to around £27,000 a year.
Financial services employees
The financial sector offers some of the highest pension contributions in the private sector, with many large employers contributing an average of around 10 per cent of an employee’s salary for each year of service. Some firms, particularly banks and investment management firms, may offer even higher contributions, often matching employee contributions up to a cap. Smaller firms, especially start-ups, are less likely to offer such generous employer contributions.
If your employer contributes 10 per cent and you contribute 5 per cent of your salary to your workplace pension on an average £37k salary for 40 years, and your pension delivers average investment returns of 5 per cent a year, it might be worth nearly £840,000 after 40 years (including basic rate tax relief). This would be worth just about £28,000 a year for a 30-year retirement (not taking into account fees etc).
Firefighters
The Firefighters’ Pension Scheme (FPS) includes an employer contribution rate of 37.6 per cent in England, making it one of the most generous public sector pensions available. Employees pay between 11 per cent and 14.5 per cent of their pensionable pay, depending on salary.
Like the police pension, it is a defined benefit scheme that ensures a steady retirement income based on final salary or career-average earnings, depending on which version of the scheme the employee is registered to.
After 40 years of service, a firefighter can potentially receive about two thirds of their salary at age 60. That means you would receive a retirement income of just under £25,000 if your salary was £43k.
Police officers
The Police Pension Scheme (PPS) is another defined benefit plan, which enables officers to receive a guaranteed income based on their career earnings and years of service. In April 2024, the employer contribution rate rose to 35.3 per cent of total pensionable pay for police officers in England and Wales. Employees contribute between 12.44 per cent and 13.78 per cent towards the scheme, depending on their salary, and once they retire they receive an income based on their averaged salary during their years of service.
A police officer retiring on the 1987 scheme who served 30 years with an average salary of about £36,500 would receive a pension worth just over £24,000 a year.
Civil servants and government employees
Civil servants benefit from the Civil Service Pension Scheme (CSPS), with employer contributions ranging between 26.6 per cent and 30.3 per cent, depending on the salary band and scheme membership.
For the Local Government Pension Scheme (LGPS), employers contribute an average of between 14-18 per cent, on top of an employee’s contributions. This is also a defined benefit scheme based on your salary and years of service. 1/49th of your pensionable pay goes into your pension each year.
Remember, salary is only one part of the equation when it comes to working out your income. Pension figures above do not factor in fees and performance; if you’re a higher-rate taxpayer (earning over £50,270 in the 2025-2026 tax year), you can claim an extra 20 per cent tax relief via self-assessment or by contacting HMRC.
When investing, your capital is at risk and you may get back less than invested. Past performance doesn’t guarantee future results.
