Some handy pension tips
September 8th, 2010
People understand that retirement is the longest holiday of their life so make sure you are ready.
1. A good start is to work out the level of income you would like when you retire and understand how much you need to be saving to achieve this level. You may well not have enough spare income at this time to bridge the gap but at least you know about the potential shortfall and can plan accordingly. Contact us and we will put you in touch with a qualified adviser who can help with this calculation.
2. Many of us have left pensions behind as we have changed jobs and no longer receive statements or any communication about these pensions. Often the Company you worked for will have closed down or been taken over, sometimes many times over and your pension is somewhere out there but who is looking after it? TIP 2 is to locate all your pensions and have them reviewed. Click here to start this process today.
3. Simply having a pension is not enough. Your pension is there to fund the longest holiday of your life, will it do this? Pensions should be reviewed at least annually as your needs change as does your willingness to take risks as you near retirement. Who is reviewing your pension for you? When was it last reviewed? You may be fortunate enough to have annual statements for your pension but do you understand what the statement is telling you? Do you know if the provider charges are competitive or the performance reasonable when compared to the market? TIP 3 is to have your pension reviewed now and annually. Click here to start this process.
4. Understand your personal attitude to risk. This is important as we are all different. There are many different funds that pension providers will invest your money in ranging from high to low risk. The chances are that your money has remained in the same fund since you started the pension but your attitude to risk may well have changed over the years. It is important, for example, that if you are in your 20's or 30's you may be somewhat adventurous and prepared to take higher risks given the time you have before retirement, but surely this would not be the case in the years as you approach retirement All funds have a risk attached to them and this should match your attitude to risk. TIP 4 is to check that your investments/pensions are invested in funds that match your attitude to risk
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