Financial planning for retirement

We all know that we need to have a pension to help support us in retirement, but how much have you thought about your financial plans beyond that? This article looks at other retirement money management  tips.

gold piggy bank wearing glasses indicating pensions


Although retirement might still be a few years off for you at the moment, it always pays to be prepared for your next life stage. 

There are a few financial products that might be beneficial to you in addition to the pension that (hopefully!) is already waiting for you.

Let’s look at some of the options in your retirement planning.

Seek expert retirement advice

First of all, getting detailed and personal advice is invaluable. This is possibly the most important stage in your life for getting financial planning right.

If you don’t have a financial adviser, find one. Ask friends or family for recommendations or look on your local newspaper’s website. Once you’ve found someone, check that they are registered with the Financial Conduct Authority. This will reassure you that they are bona fide and you’ll also be able to take action if anything goes wrong. 

Talking to a financial advisor won’t cost anything. They are paid by the companies whose products they recommend to you. Some of the products that a financial adviser might discuss with you in planning for your retirement are:


An annuity is a type of retirement income product that you buy with some or all of your pension pot. It will pay you a regular income either for life, or for a set period. You can choose between a standard annuity, where you receive a fixed amount, or an  investment led annuity, where the amount you receive could increase (or decrease) depending on stock market performance.

There are lots of options available within an annuity, so seek professional advice.

Equity release

Equity release gives you access to some of the money tied up in your home. It can give you a tax-free lump sum to boost your overall pension pot. It doesn’t suit everyone, though, so explore the details carefully.

Downsizing to release funds

Another way to boost your income in retirement is to move to a smaller, lower value home. The profit you make from moving can be a valuable boost to your retirement  funds.

Care funding plans

These financial products help you avoid running out of money to fund your care in the future. Care plans are bought with a lump sum and are non-refundable. The income is normally paid direct to your registered care provider – which gives you a tax break.

Life insurance and critical illness cover

If you don’t already have life insurance or critical illness cover, they may be worth exploring. Life insurance pays a lump sum to your partner or children in the event of your death.

Critical illness insurance pays a lump sum if you’re diagnosed with a serious illness including cancer, stroke, a heart attack or degenerative diseases like Multiple Sclerosis. This can be helpful in paying for additional care requirements or changes needed to your home.

Generally, the sooner you take out these types of cover, the cheaper the payments.

Other retirement money management tips

The best way to prepare for retirement is to do your homework. Make sure you know what your income will be once you’re no longer working. Managing your money in retirement is all about knowing what you have available, and making sure you don’t overspend.

If at all possible, you should aim to clear all debts before you retire. If that means working for a few more months, it’s worth it. Having to pay off  debts from your pension fund will reduce your overall income in retirement.

For further information on planning for retirement, look at the Money Advice Service’s preparation for retirement checklist.

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