Several retirement reports have hit the headlines recently with a consistent message: if you want a comfortable retirement, you should plan early and be flexible.
Could a phased retirement approach work for you?
Research from Standard Life1 suggests a ‘gradual transition’ into retirement could be one of the best ways to boost your pension pot. It suggests that continuing to work part-time or taking on freelance projects can help to maintain a steady income stream as your pension continues to grow. In fact, the company’s analysis demonstrates that working three days a week from age 66 to 70 could add an extra £97,000 to a pension pot. This approach also means the opportunity to explore new interests or volunteer work before fully committing to retirement.
More Britons facing a retirement shortfall
Unfortunately, the retirement picture isn’t entirely rosy. According to Scottish Widows’ annual retirement report2, a significant portion of the population (38%, up from 35% last year) are not saving enough for a comfortable retirement.
The report also found 54% of UK retirees expect to work an extra seven years on average, while 27% who have made retirement plans don’t feel they will ever be able to afford them. This shortfall is being worsened by rising living costs and stagnant wage growth.
Flexibility is key
One recurring theme in most retirement research is the need for flexibility. Having options in how you access and manage your pension can be crucial. Whether it’s phasing your retirement or adjusting your income based on the prevailing market conditions, being flexible in your approach and income needs could help you adapt to life’s uncertainties.
Don’t leave retirement planning too late
While it’s concerning to hear of people having retirement regrets, it’s important not to ignore the issue and instead do something about it when you can. As we enter autumn, now might be the ideal time to refresh your retirement plan and make sure you feel on track and well-prepared for the years ahead. Retirement is a time to thrive, not count the pennies.
1Standard Life, 2024
2Scottish Widows, 2024
The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.
