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Delaying Retirement – What Are The Benefits?

You’ve worked hard for most of your adult life, you likely have a mortgage to pay off and a family to provide for… always someone other than yourself to think about and care for. So you may be looking forward to retirement, towards a bit of ‘you time’, but when exactly should that time begin?

This does not constitute advice and advice should be sought in all instances before acting on it.

Financial benefits of working later in life

Taking a phased approach to retirement is a common choice for those who may not want to retire fully. There are some financial, as well as other benefits to delaying your retirement for a few years:

  • Extra time to pay off debts before stopping work
    As life expectancy increases, so does the cost of living, and inflation. You may not be financially prepared to stop working. A mortgage is one of the biggest debts most of us will own in our life time and the more time you can spend paying money towards your mortgage whilst earning a salary, the better off you’ll be when you do retire fully.
  • More time to build up a luxurious retirement fund
    Most of us are now more physically active and fitter in our 50s – 60s than our parents were. Life expectancy is at record levels which means that we can expect a much longer period of healthy, active retirement when the time comes. So it makes sense to keep working hard while you can, to be able to retire later and live a little more luxuriously.
  • Keeps the passion for work-life balance alive
    It’s not all just about the finances. Some people truly enjoy their careers and continuing to work ensures they keep their brain active, alongside the benefits of social interaction within their days too.

According to new Office for National Statistics data, the number of people aged over 70 who are still working has more than doubled in a decade, to nearly half a million.

Pension freedom if you’re thinking of retiring early

You now don’t need to physically retire to be able to dip into your pension fund. From the age of 55 you can start to take funds from your pension whilst still continuing to work full-time. You may decide instead to reduce your working hours and enjoy more flexible leisure time, while receiving both a part-time salary as well as your retirement benefits.

Of course, you do have to consider if delaying retirement will leave you with a tax bill. As a healthcare professional, you might find that you reach your annual allowance limit for your pension. This means that your lifetime allowance is affected and You could be left with a significant tax bill due to the tapered allowance. Retiring can sometimes be a financially better option in this scenario.

According to Aviva, early retirement will practically be extinct by 2035

It’s essential you have access to professional financial guidance

Remember it’s not only the value of your pension you need to take into consideration when planning retirement, you may have other assets that could help your finances, including savings, investments or the equity in your property. You are choosing how to receive an income for the rest of your life – it’s a huge decision to make which requires precise financial planning.

Dental & Medical Financial Services have been helping doctors and dentists in preparing for their retirement for 30 years. It’s never too early to get started. Let us work with you to create a plan and advise you on what you need financially in order to fulfil your desired retirement lifestyle.

Want to plan your retirement?
Investments | Financial Planning | Retirement | Save Tax | Protection |

Dental & Medical Financial Services have been helping doctors and dentists to build and protect their wealth, whilst saving tax for over 25 years.
Call Darren to discuss your options.

Tel: 01403 780 770


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