A 4-Point Guide to Financial Planning for Retirement

The importance of financial planning for retirement really cannot be stressed enough, especially if you have goals and dreams in mind that you have your heart set on achieving.

In this guide, our experts share with you their top financial planning tips for retirement, so that you can start preparing now for a future that is more aligned with your wishes.

1. Set your goals

It is important to have goals in mind, so that you can steer a course towards them.

Ask yourself:

  • What age would you ideally like to retire?
  • Will you fully retire, or are you prepared to part-retire for a while?
  • What are your ambitions for retirement?

Ambitions are important. Some people for example have their hearts set on a retirement filled with travel. Others are keen to fulfil a lifetime dream of buying a motorhome, a place in the sun or a weekend cottage in the countryside.

Setting out your goals will help you when it comes to planning what financial position you will need to be in when you retire.

2. Work out your likely retirement income

A key part of financial planning for retirement is working out how much you are likely to have coming in once you retire.

If you are eligible for a state pension, you can check online how much you are likely to receive.

If you have a private pension, your annual statement from your pension provider should provide a forecast, detailing how much you may receive if you decide to take your pension on the date you specified.

Do be sure to trace any lost pensions that you may have lost track of. The free Pension Tracing Service provided by the Government can help you with this.

Aside from your pension income, you should also factor in any savings and investments that could potentially be used to help fund your retirement.

Remember that, as long as you are at least 55 years old (possibly younger if you are in poor health), you do not have to stop working altogether when you take your pension, so you could in theory partially retire, and use your reduced salary to part-fund your retirement.

Finally, think about the fact that some of your outgoings may be reduced in retirement. Perhaps you will have finished the paying off the mortgage, or will have settled any loans you have been repaying. Do factor this in, as it could have a positive effect on your disposable income.

3. Determine your spending needs in retirement

We have already talked about setting your retirement ambitions, some of which may impact upon your spending in retirement, so do bear those in mind at this stage.

In addition, think about your vision for your retirement lifestyle. Will you be meeting up with friends more often for example? Enjoying meals and days out? Maybe you would like to treat your grandchildren on a regular basis, or even help to fund their education?

It is good practice to draw up a household budget so that you can see your spending patterns, and how they might change in retirement. For example, if you are spending more time at home, your fuel bills may increase. On the other hand, if you are no longer travelling to work, then you will make savings there.

This is a good retirement planning exercise, as it will help you work out whether you need to make any spending-related changes in the time leading up to your retirement.

4. Consult an independent financial adviser specialising in retirement planning

When you are financial planning for retirement, the best thing you can do is consult an independent financial adviser with specialise expertise in retirement planning.

Once your retirement planner has taken time to thoroughly understand your goals and your current position, they will work with you to set out a plan to support you in getting you to where you want to be.

Such a plan may include suggestions to help boost your income in retirement. Efficient ways of paying off debts without negatively affecting pension income; maximising income from savings and investments and reviewing outgoings will all be factored in.

It may be that you are advised to pay more into your pension and push back your retirement date. Although you may have to wait a little longer, it could leave you better placed to realise your ambitions.

Whatever advice you receive, providing you are engaging with an independent financial planner, it will be fully tailored to you and your individual situation and goals.

Once you have your retirement plan in place, it is important to keep it under regular review. Things have a habit of changing, so be sure to keep in contact with your retirement planner who will know just how to keep you on track.

Fully personalised, highly specialised retirement planning advice, from a name you can trust.

At Partridge Muir & Warren, we have been sharing our expertise around financial planning for retirement with the people of Surrey for more than five decades.

We offer a retirement planning service that is designed around your personal goals. Our award-winning service is backed by a close team of specialist finance, tax and legal experts, all focused on the best interests of our clients.

To learn more about how we could help you plan the retirement of your dreams, you are welcome to get in touch.


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