Planning ahead for retirement

 

Work out how much your retirement income will be

1. In the United Kingdom, most people can claim a State Pension from the Government when they reach state pension age. You can check your state pension age on the gov.uk website. The current rate of State Pension is £168.80 per week, but it is worth checking your entitlement beforehand.
2. Find out how much you will get from your company’s pension pot. Each year you should receive a detailed statement from your pension provider, but it may be worth asking for one sooner.
3. Total up any savings or investments you may have to draw on in retirement.
4. Trace any lost pensions. The Pension Tracing Service can help you with this.

If you are getting close to retirement age and are worried about the amount of income you may have when you retire, it is a good idea to look at ways in which you can boost your income now.

Clearing debts

Planning to clear your debts is an important part of planning for your retirement. If you are struggling with debts then there are several places you can get free advice and support including:

• Age UK
• Citizens Advice
• Debt Advice Foundation
• National Debtline

A trained debt advisor will be able to help you set a budget and pay back debts in an organised and manageable way.

Making overpayments to your pension

If you are debt free and your pension provider allows it and you can afford it, it may be worth making overpayments to your pension pot. This will allow you to increase your overall amount to retire on.

Delaying your personal pension

Delaying the date on which you draw your pension will allow you to pay more into it and potentially give it more time to grow. If you are considering this option, it is important that you take advice from your pension provider.

Working during retirement

For some people, this is a viable option. You are legally entitled to keep working past your retirement age, which would mean that you can both claim your State Pension and continue earning for as long as you feel able to.

Budgeting during retirement

Managing your money is an important part of planning for retirement. Once you have an idea of what your income will be, it is important to sit down and create a realistic budget.

Doing so in advance of retirement age, will enable you to work out whether you have enough income for a comfortable lifestyle and give you a much greater feeling of control over your finances.

Once you have completed all of the above steps, it may be worth speaking with a financial adviser to give you greater peace of mind and to confirm you are planning for retirement in the best way.

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