First Steps: Approaching Retirement Planning

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by: bluespeckmedia
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Date: Tue, 17 Jan 2012 Time: 2:31 AM
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Retirement signals the end of a working life and the beginning of a well earned break. However, there could still work to be done if you haven't already started planning your finances or pension income for later years.

A recent survey suggested that as many as 37% of the over 55s have no financial plan in place for retirement, making for a very uncertain financial future. So what steps can you take to ensure your retirement is as financially comfortable as possible?

Review your pension funds- If you still have a few years until retirement you may want to review you pension/s to make sure that your contributions match up to your expectations for the size of your pension fund.This can avoid any unexpected surprises and you may still have time to adjust your contributions accordingly. The size of your fund will have a significant impact on the level pension income you will receive. Even if you are too close to retirement to make any real difference to the size of your pension fund, knowing what to expect can help you plan any additional steps you need to take to boost your prospects for a satisfying pension income.

Track down old pension funds- If you've switched careers over the years or moved jobs regularly it can be easy to lose track of money you may have paid into old pension funds. Take the time to track these funds down because they could help to increase your pension pot significantly.

Consider outside help- As well as finding out what amount you will be eligible to receive as a state pension, find out whether you will be entitled to any other benefits on retirement.

Review your assets- Are there any other assets that you could use to generate an income? You may have money in investments or savings built up over the years that you could consider reinvesting for an income. If your pension pot is too small to produce a satisfactory income you may want to consider options such as equity release if you own your own property.

Consider income options-Annuities are still the most popular way to generate an income in retirement, and there are a number of different types of annuity available on the market. Careful research will help you to find the right option for your needs. You may also want to consider staying in part time work or using pension drawdown to generate a retirement income.

Plan for when you're gone- Death can be a difficult subject to broach, but we will all succumb to the inevitable. Making a will and planning for inheritance tax can give you peace of mind knowing that your loved ones will be well protected in the event that you should pass away, and that your assets will be divided according to your wishes and the needs of your beneficiaries.

Financial planning for retirement can ease the stress later on and give you the freedom to look forward to your well earned break without a financial headache.

About the Author

John T Hughes writes for Annuity Rates UK, a site that connects consumers to annuities advice they can trust.