How much do you know about your pension? Sure, we all have one, or two, or three… But many of us don’t know the real value they hold.
Even if you’ve been with the same company for the whole of your career, it’s not guaranteed you’ll be able to breeze into retirement with a set income. People are cottoning onto this fact and are taking control of their money, with pension withdrawals increasing by 35 per cent between the first and second quarters of this year.
But with power, comes great responsibility. The FCA has found a third of all non-advised drawdowns are in cash, and this means people might be paying higher amounts of tax unwittingly.
First things first, it’s important to keep things simple before jumping into any commitments or large withdrawals.
Think about what you’d like to achieve in retirement. We’re healthier and living longer, and many of us don’t want to curb our lifestyle once we’ve escaped the nine to five. Do you want a new car? To travel more? To start ticking off your bucket list?
It’s much easier to work backwards when you have these goals in mind, working out exactly how much you’ll need for specific goals, rather than working on guesstimates. It also takes the pressure away from not fully knowing how your expenses are impacting your savings.
We need to start thinking about what our pensions can do for us, rather than letting them gather dust. Pensions should be seen as an asset, just like a house. This will help you unlock their potential.
Thankfully, we have much more choice when it comes to pensions, and we can choose to live the life we want in retirement, rather than the one we’ve been told to expect.
If you’d like to see what your pension can do for you, get in touch.
You can call us on 0141 221 5353or email us.