Want To Get The Most From Your Retirement? Here’s How To Plan For It

Many people have dreams of how they want to spend their retirement. However, often these dreams fail to become a reality because of a failure to plan. Travelling, dining out, or entertaining the family all cost money, so they require planning.

Knowing what you want to do during your retirement will allow you to understand how much income you need when you stop working. This is especially the case if you intend to have an early retirement.

Start by considering all the things you want to do when you retire. Don’t rule anything out at this stage because you can decide what is financially viable later. To help you work out the income you’ll need to retire on, speak with a regulated financial advisor.

Decide Your Retirement Date

You are not obliged to retire at any particular age, so your working life can carry on for as long as you wish. You also may be able to retire early. For instance, if you have a defined contribution pension, you should be able to access your funds from fifty-five. However, you might need to leave your money invested in your pension fund if you want it to provide sufficient income for your entire retirement.

Having the flexibility to access your pension funds makes it easier for you to taper your retirement. For instance, you can gradually reduce your working hours. A significant advantage of keeping working part-time means you’ll continue to have additional income during the period of your retirement when you are most active.

Ensure you know when you’ll receive the State Pension and how much you’ll likely receive. You can get a State Pension projection from the gov.uk website.

Calculate Your Likely Retirement Income

Knowing your likely State Pension will be just one aspect of calculating your retirement income. However, to understand if your retirement income will match the aspirations for your lifestyle, you’ll need to work out your entire retirement income.

If you have several workplace pensions, you’ll need to locate them, estimate how they are performing, and get them valued. Once you have these things, you can then decide whether it is worth combining the pensions or leaving them separate. A regulated financial advisor can assist you through this whole process.

Once you’ve got an estimated retirement income from your pensions, work out what other income you will have. For instance, you may have money coming in from rental property, other investments, or part-time work.

Does Your Projected Retirement Income Cover Your Lifestyle Aspirations?

When you have estimated your entire retirement income, you can then go back to the goals and lifestyle you want to achieve for your retirement and assess whether your income will allow you to achieve these. If your income is less than the cost of your retirement plans, you will need to generate additional income. Speak with a regulated financial advisor to get an idea of the best way to achieve this. One such method may be to make regular top-up payments into your pension.

Drawing Your Pension Funds

Something else you need to consider is how you will draw your pension funds. The way you access your income can be just as significant as the size of your pension pot. You have various options for accessing your funds, and you will have greater flexibility with some, less risk with others. Generally, if you want to have more security, you will have to accept a lesser degree of flexibility. A regulated financial advisor will help you achieve a good balance of security and flexibility with your pension funds.

Nearing Retirement Age

As your retirement approaches, you will need to inform certain people. Firstly, your employer needs to know about your impending retirement, as this will allow them to offer you an alternative, such as reduced hours or a less challenging position. You also need to get in touch with HMRC so they can adjust your tax code accordingly when you retire. To receive the State Pension, you’ll need to contact the Department for Work and Pensions and let them know that you have reached your qualification age and intend to draw your pension.

Your plans will be for a long and comfortable retirement. However, now is also an excellent time to make or remake your will to cover any unexpected situation. Also, remember that pensions need to be covered, and you can do this by using an expression of wish.

Living Your Retirement

Retirement presents you with opportunities to experience new things and do things you didn’t have time to do when you were working. However, it is not the time to stop planning. You should continue to assess your financial needs and update your plans accordingly for the future.

If you are considering your pension, speak to a regulated financial adviser like Portafina or, view the info at Money Helper.