You might think that retirement planning is something you can put off until you’re more established in your life and career, but you would be wrong. The earlier you start planning and contributing to your retirement funds, the greater chance you’ll have to live the lifestyle you want. No matter what stage of life you’re in, there are ways to kick-start savings.
This does not constitute advice and advice should be sought in all instances before acting on it. The Financial Conduct Authority does not regulate tax advice.
Planning in your 20s
It might be low on your priority list when you’re in your 20s, but the longer you save for retirement, the more you benefit from compounding, so it’s always best to start as soon as you can as it can make a huge difference in the long run. When you’re younger, you can afford to be more aggressive with your investment strategy which could result in big returns with plenty of time to recover if your risky moves don’t pay off.
Starting early also helps to instil good financial habits, teaching you how to budget and make smart decisions when it comes to investing. Take advantage of a time when you will have few financial obligations and start saving early.
Planning in your 30s
When you’re in your 30s, you have a lot more to juggle financially; maybe you have a mortgage now or a family to support. Even with other obligations, it’s important to stay focused on your retirement goals. Use this time to pay down as much debt as possible so you free up more money for investing. Save regularly and any windfalls that come your way, consider putting toward retirement. Your 30s is the time to optimise asset allocation and take advantage of employer contribution schemes to help boost your pension pot over time.
Planning in your 40s
Your 40s are the time to really put your foot on the gas and ensure you’re on track to meet your retirement goals. Ensure you are regularly reviewing your plan and have calculated your magic number for retirement to confirm the goal you’re working toward. If you haven’t already been working with a professional, seek expert advice to ensure you have the best plan possible. As you may have jumped around to a few different jobs at this point in your career, try to consolidate your pension accounts to make managing them easier. Also, consider ramping up your contributions as your 40s is the time when your salary will be such that you can afford larger contributions.
Planning in your 50s
Your 50s is the time to make sure that you have all your ducks in a row. Review your plan regularly and increase contributions, and ensure that you are maximising your annual and lifetime allowances. Now is the time to dial back on an aggressive investment strategy and allocate your assets accordingly. Familarise yourself with pension allowances and take advantage of carry-forward opportunities, if available. Working with a professional adviser at this point in life is crucial to get personalised advice catered to your specific needs and goals.
Planning in your 60s
You’ve reached the final stretch! Your 60s is the time to prepare for the decumulation phase, an important time in retirement planning. You should prepare a retirement budget that you can stick to during your retirement, accounting for changes in life that you will inevitably face in the later years of your life. Consider how you are going to receive your income and if your asset allocation mix is still working for you. Continue to review your plan and make any adjustments needed as you near the end of your career.
Planning for retirement at every stage
Whether you’re just starting out in your career or retirement is right around the corner, you should have an investment and savings plan designed to give you the lifestyle you want once you stop working. Let the experts at Dental & Medical Financial Services help you achieve your retirement goals and contact us today.