Ensuring you achieve financial security in retirement doesn’t happen on its own.  It requires good financial planning, professional advice and commitment to a plan.  Setting yourself on the right path is the first and most important step to achieve your goals.  Take a look at our top 10 Retirement Planning Tips and see the best place to start.

Did you know?

• Less than half of all people have undertaken an exercise to calculate how much they will need in retirement.
• Over 30% of all people that had the opportunity to join a company pension scheme did not take up the opportunity even when their employer offered to contribute.
• The average person will be retired for over 20 years.

So where do you start?  Right here with our top ten retirement planning tips.

1. Start saving as soon as possible and keep on saving.

Once you have made the decision to start saving for a retirement goal get on with it as soon as possible.  The longer you delay the harder it becomes to build a significant pension fund.  The contributions you make in the early years are the ones that work the hardest for you.  To ensure you can create a good habit start small, review your plan regularly and build it up over time.  Contact a Chartered Financial Planner, put together a plan, implement the recommended strategy and keep it under regular review.

2. Know your retirement needs.

 Many people underestimate how much they will need in retirement.  It can be more expensive than most people think.  We believe you are likely to need between 60 to 70 percent of your pre-retirement income to maintain your standard of living on retirement.

3. Join your employers pension scheme.

 Many employers will offer some type of pension scheme to their staff.  Quite often they will make a contribution into your plan, which can help boost, your retirement plan.  If your employer offers a retirement plan, such as a personal pension plan, ensure that you join it at the earliest opportunity.

4. Make the most of the tax breaks.

 Did you know that every penny you contribute to a personal pension plan you receive full marginal rate tax relief.  This means that if you contribute £100 you will actually get £125 invested in your pension plan.  If you are a higher rate taxpayer you will receive a further £25 tax relief via your tax return.  These tax breaks can make a significant difference to your retirement planning as they boost your savings significantly.

5. Remember basic investment principles.

 The amount you save is very important but once the contributions have been made the investment of these is the next most important aspect. Get a good understanding on how your pension fund is invested.  The right mix of assets can make a big difference to achieving your retirement planning goals.  Ensuring the investment of your fund matches your personal risk profile will allow you to get the most out your investments whilst remaining comfortable with the risks involved.  Diversifying your investments will help you reduce risk and improve return.  A good financial planner will help you achieve the optimum mix of assets and investments.

6. Draw your pension at the right time.

Drawing on your pension too early can be damaging to your retirement planning.  By withdrawing your funds earlier than expected you will be loosing future growth on the fund at the most crucial time.  By withdrawing funds out your pension you’ll be losing vital tax-free growth, which can really make a difference later on.

7. If you are a business owner start a pension scheme.

 As an owner of your own business you will have certain control over how you are remunerated.  By extracting funds from your company via pension contributions you can transfer assets to your personal wealth tax-free.  There are not too many forms of remuneration allows you to make a tax-free investment in your future.

8. Open your own retirement account.

 You are allowed to put up to £50,000 per annum or 100% of your salary into a private pension plan.  This provides significant flexibility in your pension planning.  Whilst you may not be able make a contribution at this level these allowances allow you to plan in accordance with your needs.  If one particular year you need to make a larger contribution you should have plenty of scope to make contribution.  If you have surplus income you may wish to make larger contributions to take advantage of the generous tax reliefs available.

 9. Find out about your State Pension Benefits.

 Your state pension can make a significant contribution towards your retirement planning.  Unless you know your estimated State Pension it is difficult to take it into account with in your plan.  By simply completing a BR19 form you can obtain a pretty accurate estimate.

 10. Ask, Ask, Ask.

 Whilst these pointers are designed to give you a good start and point you in the right direction.  To make the most of the options available it is recommended you seek advice from a Chartered Financial Planner.  Ask questions and make sure you understand the answers. Get practical advice and act now.

Expert Wealth Management are Chartered Financial Planners providing independent retirement planning advice in Oxfordshire, serving Witney, Abingdon and Oxford.

The contents of this document do not constitute advice and should not be taken as a recommendation to purchase or invest in any financial product. The value of a market investment can go down as well as up and you may not get back the full amount, particularly in the short term. Before taking any decisions, we suggest you seek advice from a chartered financial planner.