Pensions warning: They’re key to ensuring ‘income lasts in retirement’ as inflation hits savers | Personal finance | Finance


With increasing life expectancies, it is vital that people save enough to last over 30 years and that their pots can withstand market volatility. Express.co.uk spoke exclusively with Paul Titterton, a pension expert at abrdn. He suggested ways Britons could plan to ensure they have enough money for retirement and that people can maximize and protect their savings.

He said: “It’s essential that people plan ahead to ensure their income lasts through retirement – ​​which can last over 30 years depending on when you retire.

“First, you need to calculate how much you think you need to spend each year. It cannot simply be a fixed amount for each year.

“Your needs and circumstances will change as you move into retirement, and as you do so, the amount of money you need to spend will likely change as well.

“What it will look like in practice will be different for everyone, which is why talking to a professional can be so valuable.”

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He explained that seeking professional advice is a “key factor” in planning for retirement.

If people don’t seek advice or help, there may be things they forget to think about that could be crucial in their later years and lead to miscalculations for their funds.

“Talking to a financial adviser, who has experienced some of the costs people might overlook, such as end-of-life care,” can make all the difference, he added.

Mr Titterton urged Britons who are near or recently retired to consider seeking financial advice to help them better understand and review their income and spending.

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Seeking advice can also help make their income as tax efficient as possible.

He continued: “You will also have to take into account factors such as inflation, something that we will all be more aware of than ever.

“By ensuring that your retirement savings can keep pace with inflation, you reduce the risk that you will experience a loss of ‘real’ value in the future.

“Simply put, if your savings aren’t growing at the same rate as inflation, you’ll buy less and less of each book over time, which means you may not be able to make as much as you can. ‘ve planned with your money.”

“If you have a pension, you can withdraw up to 25% tax-free.

“However, it is essential to remember that the rest of your pension income will be subject to income tax.

“In addition, you may have to pay capital gains tax on stocks or funds outside of your pension or ISAs.

“Planning the order in which you use your investments and savings can affect the tax you pay and a financial adviser can help you review your specific situation to ensure you are not paying more than necessary, maximizing the amount you have.

“It can help alleviate worries and concerns and explore any options you may have to achieve your desired retirement.”

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