Retirement Planning Services

01

GIVE YOURSELF TIME TO PLAN FOR RETIREMENT

While the prospect of retirement can be exciting, establishing a plan to ensure you are financially sound can feel like a worrying task. It’s no surprise that the decisions you make before retiring can shape the rest of your life.

Ideally, when it comes to retirement planning, it really is a case of the earlier you start the better. By setting aside retirement savings over time you will be in the best position to build a substantial fund over your working life, making sure that funds are allocated in the most efficient way for your individual circumstances.

If you live in the UK, you will be eligible for a state pension. Whilst the State Pension is an important part of any retirement plan, the age at which you will receive it keeps increasing. The amount you will receive normally is not enough to live on which is why working with a financial planning professional to have a wide range of other assets to compliment the State Pension is so important.

02

HOW MUCH IS ENOUGH?

A common question when planning for retirement is how much you need to save. The answer is dependent on many things – including your age, desired retirement age, earnings, health, lifestyle and more. In the end retirement looks different for everyone – you may want to travel, spend time with family and friends or focus on hobbies or pursuits which your working life may not have given you time for.

Your current income, financial position and arrangement must of course be a consideration, and common sense is needed too.

Ultimately you will need to work with your financial planner to determine your own ‘magic number’ when it comes to providing for your retirement; one which reflects your unique circumstances, plans and lifestyle.

An expert can offer an impartial opinion to help you determine your retirement goals and the steps needed to achieve them. With this in mind the key point is not to ignore this critical area of financial planning.

Much like other stages of your life, planning can be a real key to success.

03

MAXIMISING YOUR PENSION

Whether you have just started your career or are near to retirement, there are ways in which you can maximise the potential of your pension.

Increasing your workplace or personal pension contributions can offer a substantial boost in the form of tax relief. This can prove particularly fruitful if you are a higher-rate taxpayer. Not only will the Government add the basic rate of 20% to your monthly contributions, you can also claim further through higher-rate (or additional) relief in your tax returns. It is important to note that there are limits on the amount of contributions you can pay into your pensions annually but this can still be a useful way to enhance your retirement pot.

Another option is to delay when you start taking retirement income. This may be suitable if you are scaling back your working time, as it gives you more time to contribute to your pension, increasing your savings when you retire. In addition, annuities and other guaranteed income products tend to increase in rate as you age, so you may receive a higher income if you delay. It is important to speak to your provider about delaying your pension, as some can charge for changing your date of retirement.

You may also be in a position to defer your state pension. The latest rules mean that for every nine weeks that you defer your state pension, your monthly income will increase by 1%. This works out at nearly 6% per annum, so can be a worthwhile exercise.

It is becoming increasingly popular for individuals to slowly scale back on their work reducing days worked over the course of a number of years to ease their way into retirement. This naturally reduces the need on pensions to provide, in turn giving them a greater chance to grow over time, but it also highlights how planning ahead of time is important. Achieving a balance between retirement savings in pensions and those in other solutions ahead of time gives more options to reduce tax in retirement.

04

DRAWING YOUR PENSION

While many have a retirement date in mind (and a predefined age on their pension plan for when pay-outs can begin) it’s important to consider a number of factors when deciding when to start taking your pension.

Firstly, you don’t have to stop working to be eligible to draw your pension. However, in the UK you currently have to be 55, unless serious health conditions trigger an early withdrawal.

The most important factor to consider is how you want your retirement to look, both financially and personally. As with all decisions regarding retirement planning, it is important to seek professional advice, to ensure that you make the correct decisions for your circumstances.