re-tire-ment | RE’tyRment
Retirement planning is just another form of long term savings – tax efficient certainly – but just a means of ensuring we have enough money to be able to say 'Enough’s enough – I’m out of here!'
What are the risks?
The value of pensions and the income they produce can fall as well as rise. You may get back less than you invested
There are 3 stages to our retirement planning:
1. Early wealth creation, with the risks being
Not starting early enough! The savings we create at the start of our working lives are the funds that have the best growth potential.
Missing out on the help & support provided by our employer as they offer to also contribute into our retirement fund.
Missing out on the tax ‘breaks’ available to encourage long term savings.
2. Accelerated wealth creation, with the additional risks of
Missing out on the higher growth potential in the way our savings are invested.
Being over charged for the on-going management of our savings fund.
Not saving enough.
No plan to repay debts (our mortgage in particular).
3. Wealth preservation, having created a retirement fund the risks relate to
Not taking too much risk with our investments (preserving what we’ve established!)
How best to secure an appropriate level of income (for us personally AND our spouse, or partner)
Unnecessarily, paying too much tax!
The solution might include...
Joining a pension (a regular savings plan with certain benefits)!
Finding out what ‘pension benefits’ my employer offers?
Also, what plans do they have for ‘auto enrolment’ (it means enrolment in a pension will soon be a part of ALL employee benefits)
Have a plan! Enjoy work secure in the knowledge that retirement looks pretty good too!
At retirement – plan carefully. What do we need and how best do we get it?
Things to consider...
Am I getting full (higher rate) tax relief on any monies being saved in pensions . . . many people don’t!?
Develop a routine of periodic ‘wealth’ checks – how is my plan coming together?
As we get close to retirement, we may want to take less risk with our investments?
The way in which I ‘shape’ my pension needs to look after me AND my spouse!
I am entitled to shop around at retirement to secure the best income (annuity) – don’t miss out on this ‘Open Market Option’.
Our top tip...
Check out the State Pension Calculator on www.gov.uk/calculate-state-pension
In addition to my own pension plans – “What am I entitled to from the Government? Ah so that’s where all that National Insurance goes!”