Each week in our Friday Five, we provide five quick tips about a different topic of interest. Interested in seeing a particular subject discussed? Send an email with your FAQ to [email protected].
This does not constitute advice and advice should be sought in all instances before acting on it.
You’ve worked hard, saved diligently, and invested wisely for several decades and now you’re ready to retire. You need to ensure that you have all your ducks in a row before you’re able to enjoy it though.
Here are five things you need to in preparation for retirement.
1. Check when you can start receiving your pension
When you reach state pension age, you can claim your state pension. If you’re not sure when that is for you, you can easily check online. If you wish to keep working past that age, you can defer it with no impact on retirement.
If you were part of a workplace or personal pension scheme, confirm the age you’re allowed to claim. For many, the age is 55, but under special circumstances, such as illness, you might be able to withdraw sooner.
2. Make sure you have a plan
Going into retirement unprepared is a bad idea. We strongly advise working with a financial advisor who will help make retirement planning easy and can advise on things to do before you stop working. After all, you want to make sure your lifestyle is exactly how you planned it.
You should calculate how much money you’ll have coming in from all your various sources (and double check that you haven’t lost track of any pensions over the years). Then set up a budget to ensure you can stretch your money over a long period of time. Don’t forget about any benefits you may be entitled to – every little bit helps!
3. Decide how you’ll take your pension
There are a few different ways you can access your pension, and they each have different tax implications that may sway you one way or another. Check with a financial advisor what your options are so you can make an informed decision. You can:
- Choose to take a lump sum
- Purchase an annuity
- Withdraw directly as needed from the fund, or
- Mix and match from all options.
4. Stay alert
Pensions have become such a hot commodity, they have become the victim of scams – especially after the new rules regarding the allowance of lump sum distribution came into effect. Pension scammers will try to convince you to “invest” when all you’re really doing is kissing your money goodbye. If something seems too good to be true, it most likely is, so always get a professional opinion on any investments, especially when it comes to your pension.
5. Meet with an advisor
When dealing with such important financial matters, working with a professional is always a good idea. Ideally, you’ll have been working alongside a financial advisor since you started working, but experts can still help no matter where you are on the road to retirement.
Retirement planning is one of our specialties, so if you’re hoping to retire this year, don’t hesitate to contact us today.