Most over-45s are not making plans to match their hopes for the future, according to recent research *.
The vast majority (86%) of those aged 45 or over are already dreaming about escaping their working life for retirement, but only 8% of the same age group have recently checked the retirement date on their pension plans to make sure they are still in line with their plans.
Over half surveyed (56%) do not have a clear idea of when they want to retire and only 10% have worked out how much income they will need when they decide to stop working. The study reveals it doesn’t get much clearer as you go up the generations, less than a fifth (17%) of those aged between 55-64 have recently checked to see if the retirement date on their pension policy is still fitting with their plans.
|FOUR REASONS TO KEEP YOUR RETIREMENT PLANS UP TO DATE|
|1 RIGHT SUPPORT, RIGHT TIME
If the date you plan to retire changes, or you simply want to take some of your pension without stopping work, it is important to tell your pension company. Otherwise you many not receive information and support about your pending retirement at the most helpful times, as they will be basing this on outof-date plans.
|2 DE-RISKING INVESTMENTS
Some investment options will start to move your pension savings into lower risk investments as you get closer to retirement. If you don’t have the right retirement date on your plan, you could be moving into these investments at the wrong time. ie. move too early and you could potentially miss out on investment returns, but move too late and you could be exposing your life savings to unnecessary risk.
|3 INVESTMENT POT
The size of pension pot you need to build up to maintain your lifestyle when you retire will depend on when you plan to do so.
If you’re planning to buy an annuity at retirement to guarantee an income for the rest of your life, the amount of income you get will depend on the size of your pot and annuity rates at that time. If you prefer to use your pension saving more flexibly, you can keep your money invested and take it as and when you need to. You’re then responsible for making sure your life savings last as long as you need them to.
Reviewing your retirement date regularly, particularly as you get older and closer to retiring, is to be recommended and most pension plans these days enable you to revise your retirement date whenever you choose.
For some these decisions can seem daunting. At TL Dallas we are committed to helping our clients make the most of their money. Whatever your financial needs and objectives, we can help you achieve your goals, while ensuring that you are comfortable with the risks involved.
If you would like to discuss your pension, or any other financial situation, please get in touch on 01274 465557 or email firstname.lastname@example.org.
It will only take a few minutes, with no obligation on your part, but it could end up giving you real security and peace of mind.
*research carried out online for Standard Life by Opinium (November 2017)