Retirement planning has evolved in recent years. Now, it’s up to everyone to take responsibility for funding their own retirement. But if that’s the case, is it possible to figure out how much money you’ll need to afford your dream retirement, and can a financial plan help point you in the right direction?

The way we think about retirement has changed

Compared to past generations, people today tend to live much longer and are spending more of their years in retirement. Today, more people consider retirement as the beginning of a new adventure, rather than the end. But this also means that funding those retirement years has become considerably more costly.

A retirement plan can make the difference

To give yourself the retirement you want, you need to accumulate a pension pot that will be big enough to last – potentially for many decades. But how much is enough? To answer that, you need to ask a few key questions:

  • Have you decided what you want to do when you retire?
  • How much is that going to cost you?
  • How much have you saved towards retirement so far?
  • Are you on track to achieve the amount you’ll need?
  • Do you need to do more to grow your retirement pot right now?
  • Do you need expert help to set out a robust retirement plan to meet your objectives?

More more people consider retirement as the beginning of a new adventure

Retirement planning in action

Once you’ve got the answers to these questions, a good financial planner will help put you on the right path. They will get to know you, your current circumstances and financial situation, explore your personal aspirations for retirement, and outline the path to get you there. They might also use software like cashflow modelling to help visualise your future lifestyle, what you need to do to get there and what could throw you off course.

Cashflow modelling usually includes:
  • An appraisal of your current finances
  • Scenarios that show how much your retirement pot could grow to, depending on different outcomes. Likewise, scenarios that show how an unexpected event might negatively impact your plan
  • Examples of how much income you’ll need to achieve the retirement you want
  • Guidance on how to keep generating a tax-efficient income from your savings during retirement

Keeping your retirement plans on track

After you’ve worked with a financial planner to determine your retirement strategy from the outset, you can choose to have regular reviews to make sure you stay on track.

Having regular reviews with your financial planner can help you to make sure your pensions and other investments are performing as expected, and that you’re still getting the best value for money. And, because life rarely goes entirely to plan, your financial planner can help you to stay on top of unexpected life events and adapt your retirement strategy accordingly.

Everyone is different – so work out what suits you

We all have different expectations of what we want from our retirement, but we also want the peace of mind from knowing that we won’t run out of money. While the way people approach retirement has changed, the journey doesn’t have to be a complicated one.

Having a clear idea of the retirement you want and working with a financial planner to set you on the right path, you can be confident that you’ll be on track to afford the retirement you dream of.

There have been significant changes to pension savings in the Spring Budget 2023 that may impact your retirement planning. To find out more, see: How does the 2023 Budget affect your pension and retirement planning?

Get in touch

To speak to one of our team, arrange an appointment or find out more, call 0800 915 0000, or alternatively use our contact form here.

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