In days gone by, the only retirement option for most people was to buy an annuity – a guaranteed income for life – so most pension funds were designed with that in mind.
All this changed in April 2015 when pension freedom arrived. You can now access your pension pot from the age of 55, choosing how you want to take the money in a variety of ways. It is likely that your pension fund is set up with an annuity in mind. You are therefore unlikely to achieve the best value if you wish to use it for drawdown.
Arriving at retirement in a few years’ time means taking the right action now – preferably five, ten or even fifteen years before you start to do so.
By failing to plan far enough in advance, you run the risk of letting your pension fund steer your decision, rather than the other way around.
Planning five or ten years in advance gives you a destination to aim for. You can then see if your pension is currently on course for that destination – in the vast majority of cases, it will need at least altering to ensure it is heading in the right direction.
Here are the steps you should be taking to keep your pension on track.
- Get a sense of where you are now
- Think carefully about your retirement goals
- Discuss pension choices with your adviser
- Is there any action you need to take now
- Regularly review your goals and pension arrangements
Do you have the time and knowledge to deal with this?
Seeking independent financial advice from us can really help. As advisers we can assess your circumstances and search the whole of the market to find the solution that fits your needs best.
Our assessment also takes into account all your other financial circumstances too, and other factors such as your attitude to investment risk.
So, go on, dig out your pension paperwork and give us a call to start the ball rolling.
We look forward to working with you.