Retirement may seem like a lifetime away for some, for others it may be within the next few years. Regardless of your age, you only get one chance to prepare for it. Making small changes today can make all the difference later in life.
This week the government brought forward the year in which they plan to change the state pension age. Consequently, people currently in their forties will now have to work an additional year before they become entitled to their state pension. So, if you don’t wish to rely on the state and work until you’re 68 here are a few tips to help you:
Think about what income you’d like when you retire and set a goal to work towards
Consider how much money you’d like to live on during retirement. Your spending habits may be very different in retirement compared to how much you spend when you are working.
Some people reach their chosen retirement date and are shocked that their pension savings won’t provide them with the income that they need to stop working. Your retirement needs to be well planned, managed and regularly reviewed.
Work out what plans you currently have
If you’d had a few jobs during your working life, it’s likely you’ll have pension schemes in a variety of places which is why it’s important to check for any ‘forgotten’ pensions from old jobs. Take the time to go through your paperwork and match it to your career history. If you’ve moved to a new house, check all pension providers know your current address.
Also, consider what savings and investment plans you have that may be used towards your retirement.
Planned lifestyle changes
University costs, your daughter’s wedding, helping children/grandchildren onto the property ladder to name but a few significant ‘one-off’ costs you may wish to help your family with. Again, factor these into your plans and budget for them.
Appraising past plans
Whilst it’s key to plan, it’s also important to make sure that you don’t lose what you have already saved. Make sure you know how the money is invested and how much risk you can afford to take with your savings.
Seek advice and review regularly
If you do not feel confident about analysing your current pension arrangements or making decisions on your own then speak to an Independent Financial Adviser. They will be happy to provide you with a pension review service and enable you to make informed decisions about your money based on your whole financial circumstances and in line with your attitude to risk.
Regardless of your age, planning can make a big difference and shape your future. If you’d like to speak with one of our advisers about reviewing your pension savings or your options at retirement, please get in touch, we’d love to hear from you.