Have you done everything possible to ensure a comfortable and financially independent retirement?

 

Your retirement income might depend on several workplace pensions, your social security pension, or even investments and savings. Are you confident that you have enough saved up?

Did you know there are ways to optimise your retirement income and reduce taxation?

Pension transfers - You could transfer all your workplace pensions into one tax-efficient place where you have control over the investment choices, e.g. a QROPS. Often workplace pensions are invested in generic funds, and returns are not necessarily optimised. You might end up with several smaller workplace pensions. It could make sense to have them all in one place where a larger amount can earn more interest.

Private pensions – A private pension is something you have control over and could be the one constant during your working life, e.g. a SIPP (Self-Invested Pension Plan). Because we change jobs an average of seven times in our lifetime, a private pension could be the way to guarantee a specific retirement income. It would be best to decide whether your workplace pension will be your primary source of retirement income or your private pension.

Do you know at what age you wish to retire?

This could significantly impact your retirement planning. Remember that we are living longer, and our retirement will be longer than our parent’s. The longer the retirement, the more you must save.

 

What about supplementing your pension if you want to retire earlier?

A separate investment could help bridge the gap years if you wanted to retire earlier than expected without eating into your primary source of income, e.g. if your retirement planning and forecasts were planned for 65 and you want to retire at 62. 

Remember, you earn the most interest on your capital in the last few years before retirement. Early retirement could see you run out of money down the line.

It is always good to have an extra retirement income source that is not part of monthly income plans. These savings could cover any financial emergencies and unforeseen expenses or be used for holidays. Either way, it is always good to have a pot of gold hidden away at the end of a rainbow for a rainy day.

 

Chat with your advisor about optimising your retirement portfolio and adding on supplements. [email protected]

 

Please note the above is for educational purposes only and does not constitute advice. You should always contact your Acuma advisor for a personal consultation.

* No liability can be accepted for any actions taken or refrained from being taken as a result of reading the above.