Retirement planning for self-employed professionals: Build freedom on your terms
Published 8 July 2025. Updated 26 June 2026.
When you are self-employed, you are the boss. But that also means you are responsible for building your own retirement plan. There is no employer matching your pension contributions or handling paperwork for you. It is all on you… and that is both empowering and challenging.
With the right steps and tools, you can design a retirement that supports the lifestyle you want, without relying on the hope that you will “sell the business someday.”
Know what you need to retire well
Start by defining your retirement vision. When do you want to retire, and how do you want to live?
Estimate how much income you will need per year in retirement
Factor in housing, travel, healthcare, and lifestyle costs
Adjust for inflation over time
Tools like retirement calculators or a financial planner can help turn a vague goal into a clear target.
Choose the right structure
In the UK, self-employed professionals have several options to save for retirement:
Self-Invested Personal Pension (SIPP): Invest in a wider range of investments.
SIPPs tend to have higher costs and are generally only suitable for investors already experienced at actively managing their investments.
Stakeholder or Personal Pension: Usually lower cost and simpler to manage.
Lifetime ISA: Bonus from the government for those under 40, with restrictions.
Contribute regularly. Even small amounts build up over time thanks to compound interest and tax relief on pensions.
Whichever route you choose, it's worth being clear-eyed about how these work. Pensions, SIPPs and ISAs are usually invested, so their value will go up and down over time and isn't guaranteed. Your capital is not protected and you could get back less than you put in. Because retirement is typically a long-term goal, staying invested over many years has historically helped to smooth out shorter-term ups and downs, although that isn't guaranteed and your outcome will depend on how your investments perform.
Automate your savings
Treat retirement savings like a business expense, not an afterthought.
Set up monthly contributions into your pension
Increase the amount as your income grows
Use tools to automate transfers and monitor progress
Out of sight, out of temptation. This helps you stay consistent even during busy or unpredictable months.
Diversify your retirement income sources
Your business might be an asset, but do not rely on this fully to fund your retirement.
Build a pension and invest in ISAs, property, or other vehicles, depending on our objectives
Consider the best way to invest so that your growth is tax efficient
Think about how you will access income tax-efficiently in retirement
A mix of sources gives you more security and flexibility.
Bear in mind that how much tax you pay, and the value of reliefs like pension tax relief, depends on your individual circumstances and the rules can change in the future.
Factor in the value (and risk) of your business
If you are planning to sell your business one day, great, but be realistic.
Get a business valuation every few years
Build value outside of yourself (systems, teams, brand)
Work with a financial adviser to balance reinvestment versus withdrawal
A future sale can top up your pension, but it should not be your only plan. Consider the tax efficiency of this but also the risks of having all of your eggs in one basket.
Prepare for curveballs
Illness, market changes, or shifts in your industry can derail your timeline. Build in buffers:
Emergency fund (at least 3–6 months of expenses, or more if your income varies a lot)
Income protection insurance
Life insurance and critical illness cover
Peace of mind today = flexibility tomorrow.
Review and adapt regularly
Your goals and circumstances will change, so should your retirement plan.
Review your plan at least once a year
Adjust for income changes, tax regulation updates, or new life goals
Work with a financial planner to help stay on track and optimise tax-efficiency
Final thoughts: Create a future you cannot wait to live
Retirement is not just the end of work, it is the start of your next chapter. With intentional planning, you can create freedom, security, and choices on your own terms.
You do not need to figure it all out alone.
Book your no obligation consultation today here. Let us start building your Liverpool wealth story together.
Your Wealth Wingwoman,
Shalini Kanap
Investing directly in property and Lifetime ISAs are not available through St. James's Place.
P.S. Related blogs you may enjoy
Do Financial Planners help with budgeting? Taking control of your finances
How to stop HMRC taking more than their fair share: Master your tax year end & tax return
What do Financial Advisers do? How they secure your financial future in the UK
SJP approved 26/06/2026
