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How to Plan for an Earlier and More Comfortable Retirement

Updated: Aug 24

When you think of retirement, what does it look like to you?


Everybody is different and has their own unique set of goals and aims. Some people want to go on their dream holidays and buy goods to enjoy, such as motorbikes and campervans. However, some may be happy just spending their days relaxing on the golf course or simply spending time with their loved ones.


Whatever your retirement ambitions are, many people don’t start to think about retirement until later in life. Due to other commitments, for many it becomes an afterthought.


However, it’s that old adage of, if you fail to plan, you plan to fail. When it comes to retirement planning, it really is never too early to start making sure you have all you need in place to ensure a comfortable and enjoyable retirement.


So, do you have everything ticked off the retirement planning checklist? Here are the most important things to consider so that you can start enjoying the fruits of your labour.


Do you have enough money?


Now, this may seem obvious. But one of the fundamentals is to ensure you have enough money to live on in retirement.


According to research from Which?, couples would need around £26,000 per year – which means a pension pot of £155,000 alongside their state pension – to have a comfortable retirement. Are you on track to meet this? Obviously, this is not the same for everyone and there’s no need to panic.


To boost your retirement pot, you could consider contributing a lump sum, increasing your contributions or even downsizing your home. Furthermore, you could consolidate your old pensions – and even consider delaying your retirement.


Remember, this is just an average and as such you could live on less – it really is dependent on your situation.


When do you want to retire?


This is vital. If you intend to retire earlier, you will need more money. The current rules are that pension providers won’t allow you to access your funds until 55. This is set to rise to 57 in 2028.


If you want to retire earlier, you will need to ensure you have a solid plan in place and are contributing more income into your savings. Do you need help doing this? Reeves Independent can help you…



Is consolidation the right thing for you?


People often have a variety of jobs throughout their career. According to the Department for Work and Pensions, the average is 11!


With different roles comes different retirement plans and they can be hard to keep a track of.


Combining them could make it easier to manage your money and see how much your savings are worth. Furthermore, it could save you from paying excess fees and potentially improve the performance of your investments.


This isn’t right for everyone as you could lose benefits, for example if you have a Defined Benefit (DB) scheme – which is why it is crucial you seek the advice of an authorised adviser.


However, if it is right for you, then it will make it easier to keep on top of your money and see if you are on target to retire when you want.


How do you want to receive a pension income?


How you plan to access your pensions could affect your planning. If you take a lump sum from your pension, then you’ll need a different source of income to fund your everyday spending.


There are numerous ways you can withdraw money from your pension.

You can draw down a regular amount each money, take a lump sum, buy an annuity or take it from a combination of those methods.


Whichever way you choose to take it, it will affect how much you are taking and how you will use it, so it is vital that you give it serious thought.


Are you invested in an appropriate pension plan?


You need to make sure your plan matches your age and retirement goals. Whilst younger, you may feel more adventurous as you may want to boost your pot(s) quickly and feel as though have time on your side to recover from any potential loses. On the contrary, as you approach retirement – with your goals in sight – you may feel the need to play it safe and see your planning through.


You will need to consider if you want to be a in a lower-risk plan or a higher-risk plan.


In a lower-risk plan your money will be invested in funds that have a smaller potential for growth, but with a reduced potential for experiencing short-term losses due to market fluxes.


On the other hand, a high-risk pensions plan will invest your capital into fund that have a greater potential for growth, but an increased potential for short term losses due to market variations.


It is essential that you choose the best option for you. We know this may be hard, which is why Reeves Independent will work with you to determine your attitude to risk and work out an investment strategy personalised to you.



Are you on track to receive the full state pension?


The State Pension is presently accessible for anyone about 66, but is set to increase to 67 in 2028 and 68 by 2039.


To gain the full State Pension of £185.15 per week for 2022/23, you must have paid National Insurance contributions for at least 35 years. To be eligible for the minimum amount, which is around £53 a week, you will need to have paid NI for ten years.


Whilst the State Pension alone probably wouldn’t be enough to live on to achieve all your ambitions – which is why it is vital you have other provisions in place – it can be a great way to boost your income in retirement. After all, you would have worked hard and contributed throughout your career to receive this, so it is well worth taking advantage of.


These are some of the most important factors to consider in retirement planning. If you make sure these are checked off and draw up a really steadfast retirement plan with your adviser, and work with them closely to see the plan through, then you could well end up retiring earlier and having a pleasant and relaxed retirement.


This article is for information only and should not be seen as advice or a recommendation to take action. Investments can go down as well as up and you may not get back the original capital invested.


Reeves Independent is not responsible for the content hosted on external sites.

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