Approaching Retirement

As you approach retirement age, you want and need to be sure about your financial future.

After working so hard for many years, you want to retire at the time that suits you and with enough income to enjoy it.

You may have accumulated a number of different Pension arrangements on your working journey. Some through your own serious attempt to plan sensibly and others that have simply been in place through working with different employers.

Clearly it’s important to analyse the Pension funds you have and also understand what you are likely to receive from the State Pension. This will enable you to assess the overall state of your financial future before, at and during retirement.

Existing Pension legislation enables you to access money within your Pension pot from the age of 55. Depending on the Pension schemes you have in place, you may be able to access this as a lump sum, a fixed and guaranteed Income, a variable and flexible income drawdown, or combinations of the above.

The age at which you can comfortably retire depends on a number of personal circumstances, such as the Pension values, other income sources and your desired standard of living following retirement.

It can be difficult to keep track and take stock of your existing Pensions particularly if you have contributed to a number of different schemes with different employers.

Pensions can be a complicated concept, Independent Financial Advisers (IFAs) such as Grape can help you to understand the rules that apply. By clarifying confusing industry jargon and keeping things “keeping things simple” there’s a much better chance you will engage with this thorny topic. See what is my relationship with money?

Decisions surrounding your Pension contributions can have a significant impact upon your financial health, wealth and security. Therefore it’s important that any decisions you make are financially sound and based on factual information.

Depending on your specific personal circumstances, you may be entitled to Government credits to enable you to continue to build up your State Pension. You may also be able to pay one-off contributions to boost your State Pension entitlement.

There are a number of ways in which you can receive credits but you may need to act to ensure you do.

Some situations which may warrant government credits include:

• Full-time training
• Parents and Carers
• Unemployed and seeking work
• Illness, disability or maternity leave

The most important thing to consider when approaching retirement age is whether your Pensions or investments will be sufficient to last throughout the duration of your lifetime.

This can be calculated using a cash flow modelling tool. Based on the value of your Pensions, the amount you would like to withdraw and your assumed longevity, this tool will illustrate how much income you may enjoy in retirement. This of course varies greatly from person to person and is dependent on a number of factors that we can help to identify.