Retirement allows you spend more time on the things you like. When it comes to retirement planning, you should consider what your ideal life will be. Do you wish to relocate to a new location? Going on vacation? Do you know how to drive a car? Do you like going out in the evenings? All of these things cost money, and figuring out how you want to live will help you figure out how much money you’ll need. This is especially true if you want to retire early.
ad | Collaborative feature
Now is the moment to think large and lay out all of your options. Determining what is feasible can be done later. Once you’ve decided on your dream retirement, talk it over with your financial advisor to figure out how much money you’ll need and how much flexibility you’ll need. Check out Portafina for expert and regulated financial advice to help you plan for your retirement.
Make a decision on when you want to retire.
There is no longer a predetermined retirement age in the United Kingdom, so you may work until whatever age you feel like. With a defined contribution pension, you may usually receive it at any age starting at 55, but you’ll probably need to wait longer if you want the money to last for the rest of your life.
Flexible pension access allows you to gradually retire by reducing your working hours. Working part-time may allow you to preserve more funds or even continue to contribute to it. Similarly, having additional cash during this early, more active part of retirement may be beneficial.
Make sure you know your State Income age, since this will determine when you start receiving the government’s guaranteed pension. If you retire prematurely, you’ll have to come up with more funds in the meanwhile.
Following retirement, and beyond
Ideally this stage in your life will begin a chapter of new adventures. But keep in mind that it is a time of your life made up of numerous phases, not a single event. As a result, you’ll want to keep looking forward, maybe modifying your ideas as you go.
Calculate your anticipated earnings.
Now it’s time to calculate your potential retirement income and evaluate how it compares to your anticipated demands.
You may need to dig up a number of different employment pensions if you have more than one (some may have slipped from your memory). Then you must decide whether you want to integrate them or leave them separate. Any personal pensions you may own are subject to the same rules.
After you’ve identified all of your pensions, you’ll need to figure out how much each one is worth. A financial consultant can assist you with this, as well as estimate the amount of money that might be generated.
Then figure out how much your State Pension will be – a projection may be found on the government website. (Keep in mind that you’ll only get this once you reach State Pension age.)
Finally, take into account any other sources of income you may have, such as a part-time job, investments, or real estate.