Preparing for Retirement – The Key Considerations

Have you ever given thought to what you need to consider as you approach retirement? Whatever your concept of what is a good pension pot, one certainty is that relying on the State Pension alone, will surely not provide enough to live comfortably throughout your retirement years.
How much money do I need to retire when I want?
Am I on track to meet my goals?
Am I likely to run out of money?
What do I need to do to secure the type of retirement I want?

In the absence of professional advice, these may be difficult questions to answer and emphasise why it is especially important to start reviewing your finances sooner rather than later.

If you are hoping to retire in the next 5 or 10 years, consider taking these steps now to help ensure you are on track to enjoy the type of retirement you are aiming for. Taking early action can allow you to make any necessary tweaks and alterations you may need to make; or highlight any shortfalls and how you might be able to address them.


A starting point is to track down all the different pension schemes you have previously paid into. If you have worked for multiple employers over the years, you may have several pension pots towards the end of your career. If you are unsure where to start the UK government offers a pension tracking service to help locate lost pensions.


Regardless of the type of pension – whether this is a final salary or defined contribution – your provider should always produce an annual statement for you. This should confirm what the pension is currently worth and a projection at your retirement date.


Although a pension is a long-term investment, it is still important to regularly review where and how the money is being invested. As well as monitoring how the funds are performing, this also allows you to check you’re comfortable with the risk you are taking. It is also a good idea to keep an eye on how much you’re being charged, as fees can vary enormously – and it is important to ensure you are getting value for money.


Whether you are close to retiring or still a number of years away, obtaining professional investment advice can make a huge different to your investment outcomes. A professional will be able to provide objective analysis as to how your investments are performing relative to the risk you are taking and the market as a whole. Does your portfolio have the right level of risk and diversification for your objectives? This not only applies to pensions but also any other savings and investments you may hold.


This will obviously depend on the type of pension(s) you hold. If it is a defined benefit plan, such as a final salary pension, the options may be limited to that of what age you retire and whether (or the extent) you exchange any pension for tax-free cash or not. If it is a defined contribution plan (also known as money purchase) then flexible access drawdown now provides a wide range of options to access the money instead of buying an annuity. Will you take a lump sum, a regular income – or perhaps a combination of the two? If you have multiple plans you might want to seek advice as to the most tax efficient way you could draw from the pensions.


Professional financial advice can help you make the right decision about your pensions, savings and investments – and ultimately your future. Pension products can often be complicated – especially to the untrained eye – and of course life itself can be unpredictable.  Retirement planning can play a crucial role in ensuring you are on course to meet your objectives; or if not, what action you need to take now in order to give yourself the best chance of meeting those objectives.


It is never too soon or too late to seek professional help. Whatever your situation and however you wish to enjoy your retirement, we can help ensure your arrangements are right for your needs. To discuss your plans or if you would like further information, please contact us for a free initial, and no obligation consultation and we for a will be in touch right away.

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