Coming to the end of your working life can be an exciting yet daunting prospect, as it symbolises both freedom and having to fend for yourself. It has been estimated that 15 million people are not saving for retirement, a figure which is truly staggering given that state pensions are in danger of being wiped out in the not-so-distant future.
Planning for retirement should be taken seriously, and the earlier you start, the better, so here are some of the ways you can go about planning.
Workplace pension scheme
Although it may seem obvious, it is imperative that you have a good workplace pension scheme in place if it is available to you. In most cases, employers match your monthly contributions, which means you get a 100% return on your investment straight away.
This is too good an offer to turn down, and workplace pensions are how the majority of people now support themselves in retirement. If you are self-employed, looking into a SIPP (Self-invested Personal Pension) may be a good course of action.
Whilst having a pension scheme in place is a great way to start saving for retirement, there is more you can do to help ensure your finances will be robust and safe when you stop working. Investing some extra cash at the end of each month could greatly boost your wealth in the long run (although you could also lose money).
This could be in a less risky asset, such as bonds, or in something that carries a little more risk like stocks and shares. When investing in the stock market, the more diverse your investment portfolio, the lower the risk it will carry. Investing has the potential to deliver much greater returns than keeping your money in a low-interest savings account, but you need to be sensible and cautious.
While it may cost some money in fees, seeking advice from a specialist firm like Tilney could be a great way to ensure you are well-prepared for retirement. These firms will help you to create a solid plan for your later years and have years of experience and built-up expertise in helping people to make the most of their money.
There is no need to be worried about your finances come retirement so long as you have the necessary measures in place. Remember that the sooner you start to prepare, the better.