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ISA vs Pension

Compare the long-term value of saving into an ISA versus a pension — see which wins for your situation

💲 Your Scenario

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Model your full retirement income

The full Wealth365 app combines pensions, ISAs, State Pension, property, and expenses into a complete year-by-year retirement projection with tax calculations.

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Frequently Asked Questions

What is the key difference between saving in an ISA versus a pension?

Pensions offer upfront tax relief on contributions (20–45% depending on your tax band) but your money is locked until age 57. ISAs offer no tax relief on contributions but withdrawals are completely tax-free and you can access your money at any time.

Can I contribute to both an ISA and a pension in the same tax year?

Yes. You can save up to £20,000 into an ISA and up to £60,000 (or 100% of your earnings, whichever is lower) into a pension in the same tax year. Using both is often the most flexible approach.

Does this calculator include employer pension contributions?

Yes — enter your employer's contribution percentage and the calculator factors it in as part of the total pension value, since employer contributions are a significant advantage of workplace pensions that an ISA cannot replicate.

Is the pension total shown before or after tax on withdrawal?

The pension total shown is after the 25% tax-free lump sum is removed and income tax is applied to the remaining drawdown at your estimated rate, so you can compare it directly with the ISA on a like-for-like basis.

Related guides & resources

ISAs Explained → Pension Tax Relief Explained → Personal Financial Planning →