With so many changes to the state pension happening at the moment, it is more important than ever to review your retirement planning. You need to work out what you want from retirement, what you are expecting to receive and whether therefore you are on track to achieve your goals.
Many people may not have any idea of what income they need when they retire, but working out what kind of funding you need for the lifestyle you want, as early as possible, is essential. Saving small amounts from the age of 30 onwards will feel less of a burden than having to find larger amounts to top up pension plans when you reach 50. Either way assessing your current situation is essential.
Do you know what state pension you might be receiving especially since the changes from 6th April 2016. You can work out at what age you will receive the state pension but using this online link https://www.gov.uk/state-pension-age and you can receive a statement showing how much you will receive following the changes by applying online, by phone or by post. The details are on this link https://www.gov.uk/check-state-pension.
The new state pension will provide £155.65 per week in full, but you may not receive the full amount, it depends on your National Insurance record. You have to have a minimum of 10 years to receive anything and 35 years to receive the full amount. A qualifying year applies if you are employed and earning over £155 a week from one employer or you are self-employed and paying National Insurance. There are some exceptions, these include; if your pay is between £112 and £155 a week, if you cannot work because of illness or disability, if you are a carer, if you claim child benefit for a child under 12 and if you are unemployed and claiming Jobseeker’s Allowance or Employment and Support Allowance. You may be able to top-up your contributions if required, but check out what your statement says first.
If you have private pensions are you aware of what income they may generate? Do you have more than one and are you aware of when they will pay income and how?
Have you looked at whether your current pensions are performing? When did you last review them? As a long-term investment pensions still need to have regular monitoring to ensure they are working towards your goal and are still in line with your attitude to risk.
Do you know what type of pension you currently have? Is it a workplace scheme, private or just the state pension?
You can have as many pensions as you want but there is a limit to the amount you can contribute. Through careful planning you may be able to benefit from tax relief/concessions. Please note that the lifetime allowance changed to £1 million on 6th April 2016.
Whatever your situation and whatever your age, it is important to get independent financial advice and to plan ahead for your retirement. Our free initial pensions and investments review can help you find out what your retirement might look like currently and help you plan for the retirement you actually want. We can look at the current status of existing pensions, assess whether it is worth combining them into one plan and provide feedback on performance. Give us a call today on 0333 456 0333 or email firstname.lastname@example.org to book a review.
This content is for information purposes only and does not constitute a personal recommendation.