So you are in a workplace scheme. Job done? Not quite. Retirement may seem like a long way off but “life’s longest holiday” takes a bit of planning. After all, you want plenty of “spending money” to enjoy yourself and that “holiday break” could last longer than you think.
Life expectancy has improved dramatically in the last few decades and many people will now live much longer than you might have expected. According to the Office for National Statistics, a 65 year old man in the UK will live for an average of 18.5 years, whilst a woman of the same age can expect to live for 20.9 years*.
*National Life Tables, UK: 2014 – 2016
Living longer and healthier lives is great news, but it makes planning for your retirement ever more important. Luckily, preparing for the future can be a straightforward task and there’s lots of help available. To create a plan, start by asking yourself:
- When do I want to retire?
- What income do I want?
- Can I afford to retire?
Want to know your options?
Generally, you can start taking pension benefits when you are 55 (under certain circumstances you may be able to take them earlier) as:
- A tax-free lump sum, normally up to 25%
- Regular income with a drawdown pension;
- Guaranteed regular income with an annuity or a drawdown pension with a secure income feature, or
- A combination of these.
Alternatively, if you are some time away from retirement, you can wait and decide later. The key thing is that your savings are there for you when you need them. Please note that not all options are available under all plans and any contract with a guaranteed minimum pension or guaranteed annuity option carries restrictions. This information is based on our understanding of current taxation law and HMRC practise, which may change.
Would you welcome independent advice without obligation?
If it has been a little while since you reviewed your retirement planning – why not make a financial planning wealth check as one of your New Year’s resolutions? We look forward to hearing from you.
By Ivan Lyons, Director, Investment Solutions, Worthing
Contact Investment Solutions: Grafton House, 26 Grafton Road, Worthing, BN11 1QT. 01903 214640 or send an email to Ivan at: firstname.lastname@example.org or visit www.investment-solutions.co.uk