Pothole Pensioners Face Bumpy Road Without Proper Route Guidance
With a recent survey stating that 40% of over 40s don’t even know the basic cost of their own retirement and have no planning in place, it’s now more than ever crucial to sort out your future.
The findings from Saga Investment Services suggest that despite the increase in pension freedoms, 80% of people stated that they had no idea how big they would need their pension pot total to be in order to fund their retirement – experts reckon its two thirds of the income earned whilst working.
On average people believed you could afford a basic lifestyle with a £126,000 pot, but in reality this pot would provide you with only £6,904 per year. These figures indicate the gap between people’s ambition and the reality that they face
They stated that a comfortable retirement could be afforded on a pension pot of £244,000, whereas in reality this would only entitle them to a yearly income of £13,300.
On the whole, £500,000 was the amount people believed would afford them a luxury retirement lifestyle, although this would pay an annual £27,000 in reality. This is 2/3 below the amount of real income required to achieve an extravagant retirement.
As Benjamin Franklin said “death and taxes are certainties”, if you don’t plan ahead the road to retirement can be a bumpy one fraught with uncertainty. However, with planning for a retirement, making sure you maximise your pension pot, taking advantage of all your tax free and tax efficient allowances each year in line with having proper Inheritance Tax planning in place, our silver surfers, golden agers, or whatever else they like to be called can have a happy and profitable retirement spending their hard earned cash and still leave a legacy for the youngsters if they wish.Subscribe to our newsletter
Please note that the information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Pearson Solicitors and Financial Advisers Ltd or any of its members or employees. Professional legal advice should be obtained before taking, or refraining from taking, any action as a result of this article.
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