Category: Retirement

Planning for retirement is essential but can be complicated. The key is finding the right strategy to ensure a comfortable retirement. In this post, I will look at two popular strategies for retirement planning: retirement bucketing and the standard portfolio approach. We’ll explore the pros and cons of each approach and see which might be

According to figures from Quilter, there has been a significant increase in the number of NHS employees opting out of their pensions due to financial constraints. In the last year alone, 66,749 individuals stopped contributing to their pensions, citing affordability issues or other financial priorities. Opting out of a workplace pension scheme may increase your

If you’re planning for retirement, you may be considering buying an annuity. Annuities provide a guaranteed income for life, which can be a valuable source of security in retirement. In recent years, annuity rates have been on the rise, meaning you can now get a higher income from an annuity than you could in the

The State Pension is as close to a guaranteed source of income as you can get. If you have paid enough National Insurance for 35 years, you will receive the full amount, which is currently £203.85 per week or £10,600 per year. This amount will likely continue rising due to the triple lock guarantee, which

The government has removed the limit they had on the amount of money you can save in your pension over your lifetime. This was called the Lifetime Allowance (LTA); exceeding it meant paying a tax charge. This has opened up different opportunities for different clients. Should I restart contributions? If you have stopped contributing to

If you have a defined contribution (DC) pension in the UK, it’s essential to understand what happens to your pension savings after you die. The good news is that the rules for distributing DC pension benefits after death are relatively simple. Can I control who gets my pension money when I die? When you die,

LCP, a pensions consultancy that counts former pensions minister Sir Steve Webb amongst its employees, has published a guide looking at the pros and cons of someone combining all their pensions in one pot. To a certain extent, the guide is aimed at those looking to consolidate their workplace pensions, but the points covered can

Voluntary National Insurance contributions can help ensure you have enough qualifying years to get the full State Pension. If you have gaps in your record, you might be able to make voluntary contributions to fill them. In the past, you have only been able to fill the last six tax years. However, when the Government

New research [1] has exposed the staggering impact of the gender pension gap.  The study shows that women have smaller pension pot sizes in every age bracket, and the situation worsens the closer retirement gets. Worryingly, women, on average, retire with less than half the income of men. Reduction in amounts paid into pensions  The amount

Inheriting a sizeable pension can dramatically alter a lot of financial plans. So how should someone make sense of the options available and use this money wisely? What is an inherited pension? When someone dies with money in a pension pot, this will usually pass down to whoever they have nominated to receive it. Wills

A recent study promoting buying annuities has received some attention in the press. An annuity is where you exchange some or all the money in your pension for an income. The company you buy it off will pay this income for as long as you live. You can also have the income linked to inflation

The State Pension is a vital source of income for millions of retired people across Britain. If you are looking to get more income in retirement, a good place to start is with your State Pension. It is important to know how the system, which can be complex, works. If you are not receiving the

Following the release of the September inflation figures the increases in the State Pension from April 2022 can be calculated The State Pension and new State Pension are usually increased each April by the “Triple Lock” which is the higher of: Annual CPI from the September before the increase; 3-month average wage growth to July

The Institute for Fiscal Studies has released a report looking at when might be the best times for individuals to save for retirement. The findings are obviously very general but some chime in with what we find from our clients and our personal finances. What have the IFS said? Most individuals expect their income to

Standard Life Aberdeen (SLA) has just published ‘The Class of 2021’. This looked at 2,000 UK adults who were either due to retire in the next 12 months or had retired in the past 12 months. The document contains some interesting hard data alongside some softer marketing material. What stands out? The average retirement was

In the March 2021 Spring Budget, the Chancellor confirmed that the Lifetime Allowance (LTA) will be frozen at £1,073,100 until April 2026. The LTA was planned to increase by CPI each year as it has done since 2018/2019. The annual increases now won’t take place until at least April 2026. The change has little immediate

Around three in four people risk outliving their savings in retirement, a report looking into the impact of the pension freedoms indicates. The research found evidence many retirees risk potentially running their pension savings down. It termed this as “sleepwalking into retirement”. The study examined retirement planning and spending habits following the introduction of pension

Buried amongst the other announcements made on 25 November was a paper from the Treasury looking at measures of inflation. It revealed a decision about replacing the Retail Prices Index (RPI) with the Consumer Prices Index (CPI) including owner-occupied housing costs (CPIH). The RPI has not been an official National Statistic since 2013 because of serious deficiencies

A new report from the Institute of Fiscal Studies (IFS) has shown pension saving has crashed among the self-employed. What does it say? Back in 1998, just below half (48%) of the self-employed paid into a private pension. By 2018 this had plummeted to just 16%. The contrast with regular employees, because of auto-enrolment, is

The Institute for Fiscal Studies the effect of the pandemic on those nearing the end of their working lives. In a new Briefing Note, the IFS investigated how workers aged 50 and over have reacted to the pandemic. This has included how their retirement plans have already been affected by the crisis. What were the findings?

The Money & Pensions Service (MaPS) has undertaken some research among people aged 50-70 with some pension savings besides the State Pension. The results make disturbing reading: 37% of over 50s are leaving their retirement financial planning until their final two years before retirement or won’t prepare at all 35% of retirees said they left financial

Inheritance Tax (IHT) can affect property, money and possessions. Your pension is normally free of IHT, unlike many other investments. It is not part of your taxable estate. We say normally as a tax case has just finished concerning one of the times someone’s pension can be subject to IHT. What is the case? The

A report on the front page of Wednesday’s Financial Times has added weight to the possibility. It has highlighted a quirk of the calculation which could cost the Government dearly if no changes are made. To understand why we need to understand the fundamentals of the Triple Lock. The increase each April is the greater

 Deferring the state pension is the default option. If you do not claim it the Government will not pay it to you. For a lot of people, this might be a better option for them. Of course, you need to think about how long you defer for too. Factors to consider As with all pension

MIT AgeLab has identified three simple questions to ask yourself to gauge how prepared you are for retirement. They uncover crucial factors which may determine your future quality of life. When it comes to retirement planning, we are inclined to focus on accumulating wealth and spending it wisely. While not outliving our wealth is essential

The Lifetime Allowance (LTA) limits how much someone can draw from their pensions without incurring tax charges. It currently stands at £1,073,100 (2020/21). Lifetime allowance charges can arise on various occasions with the main ones being: When benefits are initially taken (Taking tax-free cash from a pension is an example of this), On the death

As you might imagine, this is a question clients ask us often. A rule of thumb is the “4% rule”. This means on a £100,000 pot you would withdraw £4,000 and increase the withdrawals each year with inflation. Taking any more runs the risk of the pot dwindling and running dry within 30 years. We

When taking an income from your pension pot, you will start with two choices. Do you want to hand over your money to an insurance company and they will pay you an income for the rest of your life? Or do you want to keep a pot of money from which you decide how much

Divorce is one of the most difficult subjects to talk about. The emotional upheaval of divorce can be difficult to deal with. So too can the financial implications. When relationships end, there are so many things to consider. Children, home, and support are the first things you focus on. When you begin the process of