One of the critical aspects of Retirement Planning; or as we like to call it, your Financial Independence, is structuring your financial affairs to make sure that you have enough money to ensure that, if and when you stop working you can spend your time the way you want to, doing those things that you always intended to do.
Too complicated to think about – A survey conducted by BlackRock’s Investor Pulse showed that in the main, the biggest financial priority for individuals surveyed was ‘funding a comfortable retirement’. Yet many people spend more time planning their holiday that their retirement – perhaps because planning for retirement seems too complicated to think about.
Don’t know where to start – We are all living longer, the State Pension Age is increasing and pensions legislation is ever changing. Understandably, we want an active, comfortable retirement but often don’t know where to start the savings process. If confusion and a lack of understanding around your retirement needs have led to put you off planning and saving, you’re not alone – in fact, over half of people in the UK are in the same position.
However, the sooner you start to plan, the sooner you will start to consider the changes you can make to ensure that you are in control of your ‘financial independence’.
Consider the following steps: –
Step 1 ~ Target
Know what you need – set yourself a target.
The closer you are to retirement, the more likely you are to know how much income you will need to cover your outgoings. If you have longer to go until retirement, it is still good to have an idea of what you are aiming for – and you should review this every year as you get closer.
Step 2 ~ Plan
Know what you already have.
Understanding what you already have will help you understand how far you are towards your retirement target. If you have several different pension plans, it may be worth considering bringing these all together into one account. In addition to pension plans, your financial independence may also be reliant on other assets, investments or income so it’s important to consider these too.
Step 3 ~ Action
What you need to think about
- Are you saving the right amount?
- Are you invested in the right kind of funds?
- When can you realistically retire / reach financial independence?
How close are you to reaching your financial independence? We can help you understand your own situation and retirement goals and then align these with what you already have in order to identify how close, or not, you may be to achieving your goals. We can then help you put appropriate measures in place to help you spend your future doing those things that you always intended to do.