While a pension is a long-term investment in your future, it’s all too easy to set one up and neglect it, assuming it will do the trick. But like any other vital long-term strategy it is worth re-evaluating your retirement plan – to ensure it remains fit for purpose, and on track to give you the retirement you deserve.
To prepare for living longer than you think
You could easily live longer than you think – and need more money in retirement as a result. Advances in medical care, working conditions and because we are typically better informed about our health means we have a 1-in-4 chance of living into our 90s, according to the Office for National Statistics.
You may therefore have to recalibrate your expectations and assess whether your money is working as hard as it could. Should you put more aside? Work for longer? Settle for living on less? It may be worth taking an online Retirement Health Check – choose it from the Financial Planning Tools when you register here – to try out various permutations and help you guide your decisions.
To effectively combat inflation
While prices are soaring now and affecting every aspect of our lives, the future effects of inflation should always be factored into your retirement plans. Because even relatively subdued inflation can have a significant impact on your financial outcome, as this article illustrates. Our powerful online tools let you include inflation as a crucial component of any retirement projections you make.
To make the most of available tax breaks
Are you making the most of the tax wrappers available to you? If you have the means, you should ensure you are not only using more of – or indeed your full – pension allowance, but also your ISA allowance. As well as maximising your investment potential with these tax wrappers, having different sources of potential income in retirement gives you more freedom to define the most appropriate withdrawal strategy for your own circumstances.
If you need a hand with any specific aspects of your retirement planning, please get in touch.
To meet the needs of the next generation
If you wish to pass on your wealth to the next generation, you may need to plan a few years in advance to keep any tax charges to a minimum. We explain some of the key ins and outs to consider in this article.
It’s worth noting that if you are planning to hand down assets to your family, a pension is outside of your estate for inheritance tax purposes, while this is not the case for other investment assets such as property. So you may need to evaluate whether a property portfolio alone really is the best thing for sound intergenerational planning.
To rigorously control your costs
While you can’t control the cost of living, you can control how much you pay in fees when you invest. Like inflation, this can make a significant difference to your financial outcome over time. Paying 1% less in fees can have quite a remarkable impact on a retirement fund – as we show here – and give you many more years of retirement income for you to enjoy.
And while it is only natural to suffer from inertia if you are already invested (and dread the stress and hassle of potentially changing providers), moving to a modern wealth manager perhaps better adapted to your needs may not be as complicated as you think.
Please note, the value of your investments can go down as well as up.
Our advisers offer restricted advice that relates to Netwealth’s products and services and does not consider the whole market. Netwealth does not provide tax or legal advice and does not advise on transfers of pensions with safeguarded benefits.