When you retire you still need food and shelter as an absolute minimum, but of course you will want to maintain the lifestyle to which you have become accustomed, so unless you can guarantee a large inheritance or windfall, then you need to provide yourself with a secure income for the rest of your life.
A well prepared pension plan which is regularly reviewed should go some way to providing you with a reasonable level of income in your retirement.
A pension plan requires action as soon as possible, so start now - and if you have already started, take the opportunity to have a closer look at your existing arrangements to make sure you are on track.
The answer to this, of course, depends on your aspirations - what will you want to do? What will be the costs of day-to-day living for you (and your partner) in retirement? What else will you want to do now you have time on your hands? What expenses will disappear, for example children or mortgage repayments?
Once you come up with a figure, add in an amount as a buffer against the unforeseen and unexpected. Now you will have arrived at the amount of pension that you should ideally be planning for. Also, bear in mind that pensions are taxable, so you will need to allow for payment of Income Tax when arriving at your final pension figure.
It is very important that you review the benefits of your scheme and the status of your personal plan, to establish if it is on track to give you the pension you want.
If you are in an employer's scheme you will be able to obtain a statement from either your employer or the pension provider outlining the scheme benefits. Alternatively, contact us and we can analyse your current provisions and make any recommendations with the aim of achieving your goals.
For a personal pension, the level of contributions you have been making to your scheme, investment performance and charges will determine the size of your pension, however, as the years go by, your fund should increase and could eventually get to a size where the investment returns come into play. The larger your fund, the more advice you may need on managing the fund for optimum performance, because every percentage point increase or decrease could potentially represent thousands of pounds.
We will be pleased to regularly assess your benefits to establish whether they still have the potential to meet your objectives, and make appropriate recommendations to you.
There is no simple answer as this depends on your employment status, e.g. self-employed, employed or director, and the benefits that are available through your employer's scheme, if there is one.
THE VALUE OF PENSIONS AND THE INCOME THEY PRODUCE CAN FALL AS WELL AS RISE. YOU MAY GET BACK LESS THAN YOU INVESTED.
TAX TREATMENT VARIES ACCORDING TO INDIVIDUAL CIRCUMSTANCES AND IS SUBJECT TO CHANGE.
Company address: Morley Fordham, 83 Ellerton Road, Wandsworth, London, SW18 3NH
T: 0208 877 3443 F: 0208 265 1442 E: derek@morleyfordham.com
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Morley Fordham is an appointed representative of 2plan Wealth Management Ltd which is authorised and regulated by the Financial Conduct Authority. Morley Fordham is entered on the FCA register (www.FCA.org.uk) under no. 165322.
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The guidance provided within the website is subject to the UK regulatory regime and is, therefore, primarily targeted at consumers based in the UK. This site does not confer any form of personalised financial advice, should you wish to receive specific financial advice please contact us.
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