It’s never too early to plan for retirement and to mark this year’s Pensions Awareness Day (15 September), we’re sharing our five top tips to help you get on the right track.
With average life expectancy on the rise, we are all having to budget for a longer retirement. We also each have different wish lists for our later years so it’s important to start planning sooner rather than later for the lifestyle you would like to lead.
There is a lot of information out there on pensions and the various schemes available which can seem complex and confusing. So, our aim this Pensions Awareness Day is to demystify the process and help you make the best financial decisions for the future, starting with our top five key pieces of advice.
- Work out where you want to get to
A good starting point is to consider the lifestyle you want in retirement and what income and expenditure you will need to achieve that. Ask yourself questions such as ‘What age do I want to finish work?’ and ‘Do I want foreign holidays each year?’. Successful planning can help you reach your goals.
- How much can you afford to save?
It can be tempting to focus on enjoying life to the full now – but it’s also advisable to keep an eye on the future and determine how you will afford to live when you’re older. Assess what is important to you in terms of expenditure in the short term and what you can do without. This will leave you with an idea of how much you can afford to put away in a pension pot each month.
- Select the right pension vehicle to invest in
We are all different so it’s important to select the pension scheme that’s right for your individual circumstances. The last 18 months have shown just how unpredictable life can be so it’s advisable to choose an option with built in flexibility, allowing you to alter the level of contributions you make and the date of withdrawal.
- Determine the level of risk you are comfortable with
Some of us are naturally more comfortable with uncertainty while others are more risk averse. Pension investments can go down as well as up and some funds are higher risk than others. You need to decide on the level of risk that will give you peace of mind.
- Review, review, review
It would be great to decide on your pension plan then sit back and wait for a comfortable retirement. But life changes and situations with pensions change too. So, it’s advisable to regularly review your position with a trusted adviser to ensure you have the best plan in place at every life stage.
Pension planning is not something any of us should leave to chance and there is no substitute for professional, clear and easy to understand guidance. Make an appointment to speak with one of our independent financial advisers today for no-obligation advice on 01691 670524 or email us at [email protected]