Boosting your pension is critical for having the right amount of funds to see you through your golden years – but many over 50s may not have the money they need to retire comfortably. Emma Watson, Head of Financial Planning & Advisory Services at Rathbone Investment Management, explains to Express.co.uk readers what to do if you’re over 50 and need to boost what you’ve got for later life.
Get together what you already have
Employees in the UK are likely to have several pensions accrued over different jobs, which you and your employer will have been contributing to if you earn more than £10,000 per year on a PAYE contract.
Ms Watson explains to Express.co.uk readers: “Establishing how much you already have saved will help you to understand and plan for saving in the future.
“If you have multiple pensions you may consider consolidating these into one pot for ease. The government’s online service (Money Helper) can help you if you’re unsure how to access your pensions and their Pension Tracer can help you trace a pension you’ve lost track of.”
Focus on what you want from retirement with a financial advisor
Picture what you want from later life – how do you plan to spend it? Where do you plan to spend it? Are you expecting extra expenses like grandchildren? And how much do you need to live comfortably, regardless of any other factors?
This, of course, requires a considerable amount of planning, Ms Watson notes.
She explains: “First you need to know what you want your retirement to look like, then you can work out how much you’ll need in order to make these plans possible.
“A financial adviser will be able to help you with these calculations and ensure you are on track to have enough to meet your goals whatever they may be.”
“It’s particularly important due to inflation which can have the effect of eroding the actual value of your funds in real terms if the rate of inflation exceeds the rate of return on your funds.
“Making regular contributions also means you can benefit from compounding, as well as managing any market volatility.”
You should also check out the terms and conditions of your pension – especially the employer contribution.
Ms Watson added: “In addition, some employers will offer to match contributions if you increase yours, so make sure to check if your employer does so.”
Explore other options
A pension isn’t the only way of saving for later life, and some look to other options to foolproof their finances in later years.
Ms Watson explained: “Annuities for example, are still an option, though less popular now. Since reforms in 2015 the number of people taking annuities has fallen, especially for those who have larger pensions.
“Annuities will offer you a secure fixed income for the duration of your retirement, however long you live.
“This will help to provide a level of financial security throughout your life, although you may not be able to pass on any wealth to loved ones through your pension.”