As the UK experiences an ageing population, a great many people are approaching retirement. The prospect of an extended period of time on a fixed income is a little daunting for some and a great number of people are considering what the key retirement solutions are in order to fully enjoy their retirement years.
There are a number of key retirement solutions which are essential for obtaining a successful and comfortable retirement. However, many people only begin to consider their retirement when it is too late to make effective and significant plans. It is important to plan ahead for your retirement finances and the sooner you begin to make preparation plans and put them into action, the greater degree of financial security you can accomplish. Financial planning is one of the most important aspects of achieving a successful retirement. Even implementing plans to save a small amount each month can accumulate into a significant sum especially in a scheme which compounds the interest.
It is important to be aware of the details of your employment pension and what contributions have been made by your employer. You should also investigate what your entitlement would be from any of these pensions and decide whether it would be a sufficient amount for your retirement plans. Many schemes allow the person to take an initial lump sum with a smaller monthly pension in subsequent months. This can allow financing a large purchase such as a retirement property.
However, even with careful financial planning for their retirement, some people are finding that quantitative easing has affected their potential pension. In these scenarios you may wish to explore alternative options such as equity release. Equity release allows home owners over the age of fifty five to leverage the equity in their home for a cash lump sum or additional monthly income. The balance of the loan is only due to be repaid when the home owner has ceased to use the property as their primary residence. For example, if they have passed away, moved into a care facility or moved into their holiday home permanently.
Consider Your Goals
Retirement should be a relaxed and happy period in a person’s life, but in order to ensure that you have a successful retirement, you will need to consider your retirement goals. Some people would be content spending their days tending to their garden, while others wish to travel and see the world. Obviously, these plans have radically different financial requirements. In order to determine what would be a successful retirement for you, you will need to consider what your retirement goals are and what funds would be needed to meet your goals. You can then plan out your key retirement solutions to meet these requirements.
Many pensions and equity release schemes offer a large initial lump sum with the potential for a monthly income later. If your plans do not require an immediate injection of cash, you may be better considering options which allow a larger monthly income to create more financial flexibility.
Alternatively, if you have goals which would require a large amount of money initially, you may be best opting for options which maximise the amount offered initially. However, if you are unsure about your goals, you will be unable to determine which financing method is better suited to your needs.
Plan for Other Eventualities
It is important to consider the possibility of unforeseen circumstances or other eventualities in your retirement plans. While no one wishes for ill health, there is a greater risk of medical issues affecting your quality of life in later years. It can be a good idea to plan out contingencies for situations where you may require long term care or assistance. Unfortunately, in today’s world very few people have family who would be willing and able to care for them in the event that they suffer from ill health in old age. Therefore, it is important to plan for these possibilities. This will create some assurance that should the worst case scenario come into play, you will avoid undue financial stress or pressure to accommodate it.
If you are worried about planning your retirement or need assistance working on your key retirement solutions, you should consult with a professional adviser. Experienced equity release advisers can assist you in exploring the possibility of equity release if you are over the age of fifty five and worried that your pension plans will not be sufficient for your retirement. This can provide a greater degree of flexibility and allow you to enjoy your later years in comfort.
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