Planning for retirement may seem complicated, but it is crucial to begin early. Seeking guidance from financial professionals will help you stay on course towards reaching your objectives. Starting your planning process sooner increases the likelihood of enjoying a secure retirement.
Our research shows that individuals in the 55-64 age group are currently feeling less optimistic about their retirement compared to a year ago, especially those over the age of 55 who are particularly concerned about increasing costs. There is also a general uncertainty about what the future holds in terms of retirement planning. Numerous studies have highlighted the fact that many individuals are uncertain about their ability to retire comfortably. It appears that feeling confident about retirement is becoming increasingly challenging for some people.
New research has also highlighted an interesting insight into the hopes, fears and aspirations of people approaching and in retirement. How much your retirement will cost depends on your lifestyle, so it differs for everyone.
However, it might turn out to be pricier than anticipated. Inflation worries have been increasing since the previous summer, and the escalating prices are a concern for retirees. A recent study also found that 33% of adults in the UK are anxious about the increasing costs of common goods, a rise from 27% in September 2021. Individuals over the age of 55 (36%) are the most concerned among all age brackets about the rising prices of everyday items.
Therefore it raises some interesting paradoxes; How to fund your retirement?
For instance, the considerable rise in property prices in recent times has likely changed the expectations of many individuals regarding how property wealth will support their retirement in the future. As people are living longer in retirement, a key challenge that many must address is how to finance it and cover the financial obligations they may encounter later in life, such as the expenses related to long-term care. Insufficient savings for old age are leading more individuals to rely on their property for income.
Studies reveal that the group known as 'Hippies' or the 'Home is my Pension' generation is growing significantly. 22% of individuals are proactively preparing for retirement and anticipate leveraging the value of their home. The research suggests that a third of non-retired individuals (35%) own a property but have saved less than £10,000 in their pension fund.
This is just one example.
In addition there are savings and investments, possible inheritances, state pensions in addition to workplace pensions. However they are all subjects for another day.
MAKING BIG FINANCIAL DECISIONS
Seeking guidance helps counteract the emotional biases individuals may experience when making significant financial choices. Managing substantial pension funds or investment decisions during retirement independently comes with considerable risks.
Therefore its easy to see why Individuals may unintentionally purchase incorrect items, face unnecessary tax expenses, or deplete their retirement savings prematurely. In contrast, a financial planner offers an unbiased, rational perspective on your finances and presents solutions that you may not have thought of.
That is where a financial plan from Pecunia Financial Planning comes into its own. We can create a lifetime cashflow forecast taking account of all incomes, outgoings, expenses, risk such as inflation and even taxation.
We then put that into a detailed report tracking your progress over the years.
Think of it like a satnav system; you know where you are now. You know where you want to go. You have the choice of using the motorways, A roads or B roads. Do you want the scenic route or direct route. Most importantly do you need a rest stop or detour along the way.
That is what our lifetime cashflow forecast delivers. Peace of mind in clear simplistic language with no complex financial language.
Give me a call today and an informal chat about how our services can help you.
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