Do you know if you can meet your monthly outgoings during retirement?
26% of savers think £11,000 a year is sufficient to live on at retirement, recent research from Portafina has revealed*. This figure is nearly £23,000 less than the recommended ‘comfortable’ standard, as outlined by the Pension and Lifetime Savings Association (PLSA) Retirement Living Standards. Portafina emphasised that 32% of savers could have a pension income shortfall if planning to rely on their state pension alone.
It was also highlighted that even if you receive the full state pension, this would only cover 26% of the income needed for a ‘comfortable’ standard of living. However, recent figures from the Department for Work and Pensions showed that of the 1.1 million who receive the new state pension, only 44% receive the full amount**.
The retirement age is rising
The age you can claim state pension is increasing to 66, by October 2020. Do you know whether you will receive enough pension income?
Bower recommend that if you are approaching retirement that you get a state pension forecast so you are aware of your potential income in advance of retirement, visit Money Advice Services
It is also wise to consider any future incidental outgoings, as well as your expected outgoings, in order to discover your net household income during retirement.
What will you want to spend your pension income on?
You should also bear in mind the kind of lifestyle you might wish to lead; for instance:
- Would you want to travel in the UK and abroad, to have regular holidays?
- Do you want to give financial gifts to close family, such as house or wedding deposits?
- Do you want to ensure there is residual income for treats, entertainment, participating in hobbies, incidental expenses, money for potential care adjustments at your home etc, etc.
Once you know your potential outgoings, you can then explore ways to increase your household income, if required.
I have a pension income shortfall – what are my options?
There are several options you can look at and we would always recommend that you seek expert, professional advice. At Bower our expert Advisers are qualified to give professional advice on later-life lending products, such as retirement interest-only (RIO) mortgages and lifetime mortgages. Suitability for these depends on your individual circumstances and needs – find out more about equity release schemes. Bower’s professional Advisers will always take as much time as is needed, to ensure that our customers are fully aware of the pros and cons of any borrowings secured against their home.
Offering an award-winning customer satisfaction journey we are proud of…
Bower customers can rest assured they will only be recommended a solution that is suitable to them. Customer satisfaction is at the heart of everything we do and congruent with our core values of trust, honesty and service. We are very proud of our verified testimonials; many of which explain how Bower finding the right financial solution for their later life needs, has changed their lives for the better.
What annual income will you need when you retire – will it be enough?
- Are you a homeowner aged 55+ who wants to explore how to get the retirement income that suits your needs?
- Do you want to start enjoying the retirement that you deserve, but need a boost to your finances?
If so, then contact us to arrange a free initial consultation to discuss how we can help you live a retirement you can look forward to. Our professional UK-based Contact Centre can arrange for a convenient appointment with your local Adviser. You can even have a family member or friend come along too. Call Freephone 0800 411 8668 to book your appointment.
Read the full articles:
* Pensions Age – Quarter of savers think £11k pa sufficient at retirement
** Pensions Age – Less than half of new pensioners receive the full state pension
