A Guide to Retirement Planning - You & Your Pension
Retirement planning and pensions have become a hot topic over the last couple of years. People are starting to think more about what their retirement will look like. Will it be champagne and holidays in the sun, or a cup of tea in the back garden? If its champagne and holidays you want, then careful planning can help achieve this. So here are a few considerations to get you started.
How much income will I need in retirement?
This is a question only you can answer, as only you know what you want your golden years to look like. If the cup of tea and a spot of gardening option is more appealing to you, then you pension pot may be more modest. However, if you want a little more excitement, then having a healthier nest egg is going to be required.
How much should I be putting into my pension each month?
This is a question we as Advisers often get asked, and the answer really comes down to what you can afford to put away, and what your answer to the first question is as well. If you want a jet set retirement and you can only afford to put £20 per month away, then your goal would probably not be achievable. However, putting most of your salary into a pension so you can have the jet set retirement is also not likely to be achievable, or practical. It is about coming to a happy medium, and your Adviser can help you do this.
So what will my State Pension be?
Currently the full State Pension is £159.55 per week. However, not everybody is entitled to the full State Pension. What you receive depends on your National Insurance record. If you want to get a forecast, you can complete what is called a BR19 State Pension forecast either online or by post.
Should I take an Annuity or have Flexi Access when I reach retirement?
So, this needs to be carefully considered. An Annuity, offers a guaranteed income for life but you forgo access to your capital. Flexi Access Drawdown does not provide a guaranteed income, you can take whatever income you like, and still have access to your capital. But you can run out of money! Speak to your Financial Adviser who can determine, your attitude to risk, aspirations and make the right recommendation for your retirement.
Please feel free to contact our Financial Advisers on 0800 038 9733 to arrange a complimentary consultation. Alternatively for further information, please visit our webpage on Retirement Planning.
This Blog was written by: Ian O'Dowd, Independent Financial Adviser