retirement-matters

Retirement matters! Today, everything is different. Not only are we living longer, healthier and more active lives, most of us can now decide when, how, and even if, we retire. It's never too early to start thinking about retirement planning. Whether you're just starting your career or you're a few years away from retirement, it's essential to start saving and investing for your future. But, worryingly, many of us may have no clear plan for what we want from our retirement and even more of us could be underestimating how much money we will need.
About Tudor Franklin IFA

Tudor Franklin was established by Richard Meats and Bharat Chudasama, with a vision for a professional financial planning and advice service that can provide clear value to our clients at any stage in their financial life. With over 25 years joint experience advising clients on such matters as investments, pensions, inheritance tax planning and protection, we pride ourselves on being professional and delivering advice in a clear and understandable way.
retirement pensions pension retire save people pension save income plan money
About Tudor Franklin IFA

retirement pensions pension retire save people pension save income plan money
RETIREMENT 
MATTERS
Time to pay your pension 
some attention?
G U I D E  T O
NOVEMBER 2022
02      |      GUIDE TO RETIREMENT MATTERSW E L C O M E
Welcome to our Guide to Retirement 
Matters. Today, everything is di!erent. 
Not only are we living longer, healthier and 
more active lives, most of us can now decide 
when, how, and even if, we retire.
It's never too early to start thinking about 
retirement planning. Whether you're just 
starting your career or you're a few years away 
from retirement, it's essential to start saving 
and investing for your future. But, worryingly, 
many of us may have no clear plan for what 
we want from our retirement and even more 
of us could be underestimating how much 
money we will need. 
"ere are a number of important questions 
to consider when planning for your 
retirement: How much money do I want 
to have saved by retirement? What kind of 
lifestyle do I want in retirement? What are my 
sources of income in retirement? How long 
do I expect to live in retirement? 
"e most important thing is to get 
started on your retirement planning sooner 
rather than later. "e sooner you start 
saving and investing, the more time your 
money has to grow.
As you approach retirement, you’ll want 
to answer other questions. How long will 
my money last? Can I maintain my current 
lifestyle? Should I choose a lump sum? 
Should I buy an annuity? Do I stay invested 
and draw an income? How can I draw income 
tax-e#ciently? Do I even use my pension at 
all for retirement or instead earmark it for 
my children? What will I do with my time? 
How will I keep myself busy? And most 
importantly, how will I $nancially support 
myself during retirement?
With the introduction of pension 
freedoms, there is no onus on us to cash 
in our pensions at set ages, and instead we 
can take our pension money any way we 
choose. But, with this freedom also comes 
responsibility, and for some, uncertainty. l
DON'T WAIT, START 
PLANNING FOR 
YOUR ENJOYABLE 
RETIREMENT TODAY!
Whether you’re looking to save 
as much as possible to build up 
your pension pot, or you want 
your money to stretch as far as 
possible in retirement, it makes 
sense to pay no more tax than 
you absolutely need to. We can 
help you look at the right options 
for your retirement plans. To $nd 
out more or to discuss your goals 
– please contact us.
Time to pay your pension 
some attention?
G U I D E  T O 
R E T I R E M E N T 
M A T T E R S
A PENSION IS A LONG%TERM INVESTMENT 
NOT NORMALLY ACCESSIBLE UNTIL AGE 55 
&57 FROM APRIL 2028 UNLESS PLAN HAS A 
PROTECTED PENSION AGE'. 
THE VALUE OF YOUR INVESTMENTS &AND 
ANY INCOME FROM THEM' CAN GO DOWN 
AS WELL AS UP WHICH WOULD HAVE 
AN IMPACT ON THE LEVEL OF PENSION 
BENEFITS AVAILABLE. 
YOUR PENSION INCOME COULD ALSO BE 
AFFECTED BY THE INTEREST RATES AT THE 
TIME YOU TAKE YOUR BENEFITS.
INFORMATION IS BASED ON OUR 
CURRENT UNDERSTANDING OF TAXATION 
LEGISLATION AND REGULATIONS. ANY 
LEVELS AND BASES OF, AND RELIEFS FROM, 
TAXATION ARE SUBJECT TO CHANGE. 
THE FINANCIAL CONDUCT AUTHORITY 
DOES NOT REGULATE TAX ADVICE, AUTO 
ENROLMENT OR CASH FLOW PLANNING.
03      |      GUIDE TO RETIREMENT MATTERS02 WELCOME 
Time to pay your pension 
some attention?
04 ‘SLEEPWALKING’ TOWARDS 
RETIREMENT
Having a solid retirement plan in place is 
key to a worry-free future
06 RETIREMENT INCOME CRISIS
With the right plans in place, you can make 
your money go further
07 ENJOYING A COMFORTABLE 
RETIREMENT
Steps you can take to ensure that you are 
prepared financially
09 GENDER PENSIONS GAP
Women’s pensions at retirement are half 
the size of men’s
11 COST OF LIVING CRISIS
Signs of more economically active people 
over the age of 50
12 HEALTHY PENSION POT
Ways to maximise the value of your 
retirement savings
14 EFFECTS OF INFLATION
Being aware of how it can impact your 
retirement plans
15 START SAVING EARLY 
AND OFTEN
What kind of lifestyle do you want 
to maintain?
16 EMBRACING EARLY 
RETIREMENT
‘Enjoy more freedom while still being 
physically fit and well enough to enjoy it’
18 CASH MAY NOT BE KING
Choosing what to do with your pension is 
a big decision
20 COMBINING MULTIPLE PENSION 
POTS INTO ONE SINGLE POT
Simplify your finances and make it easier 
to keep track of your retirement savings
22 ACCUMULATING A NEST EGG
Why saving enough for retirement is 
challenging for many people
24 GOLDEN YEARS
Pensions represent our biggest single 
source of private wealth
26 ‘HOME IS MY PENSION’ 
GENERATION
People using property to support their 
retirement lifestyle
27 DEVELOPING A ROBUST 
RETIREMENT PLAN
How much it will cost and how you are 
going to pay for it?
28 SAFEGUARDING YOUR 
PENSION
Providing an income for your loved ones 
to enjoy, long after you are gone
29 IS RETIREMENT THE RIGHT 
CHOICE FOR YOU?
General guidelines that can help you 
determine whether you’re ready to retire
31 BEAT THE PENSION SCAMMERS
Once the money is gone, it’s almost 
impossible to get it back
32 MAKE RETIREMENT THE BEST 
YEARS OF YOUR LIFE
Take control of your finances – 10 tips to 
enjoy the retirement you want
CONTENTS
As we enter our later years, it's 
more important than ever to 
have a solid retirement plan 
in place. Unfortunately, for many of us, 
that simply isn't the case. According to 
recent $gures, one in six people over 
the age of 55 in the UK have no pension 
savings whatsoever[1]. 
PRIVATE PENSION 
"is leaves them potentially facing a 
very di#cult future, especially if they 
are unable to continue working into 
their later years. "ere are a number of 
reasons why someone might not have any 
pension savings. 
Perhaps they've never had a job that 
o!ered a pension. Or maybe they've been 
self-employed and haven't been able 
to contribute to a private pension pot. 
Whatever the reason, it's clear that there 
are many people out there who are not 
prepared for retirement.
SPARE INCOME 
Despite the fact that the government has 
been trying to encourage people to save 
for their retirement through initiatives 
such as auto-enrolment, there are still 
too many Britons who have no pension 
savings at all.
Even prior to the cost of living crisis, 
there have been a number of reasons why 
this might be the case. For some people, 
they simply may not be aware of the need 
to save for retirement. Others may not 
have enough spare income to put into a 
pension pot a(er covering their essential 
living costs.
MORE COMFORTABLE
However, the most common reason is 
people believe they will have plenty of 
time to start saving later on in life. But 
this is not the case. Even if you are in 
your 20s or 30s, it is never too early to 
start saving for retirement. "e sooner 
you start, the more time your money will 
have to grow.
Findings also highlight the fact 
that one in six people (16%) who are 
within sight of their retirement still 
have no private pension savings, and 
consequently are missing out on the 
04      |      GUIDE TO RETIREMENT MATTERS‘ S L E E P W A L K I N G ’ 
T O W A R D S  R E T I R E M E N T
Having a solid retirement plan in place is key to a worry-free future
05      |      GUIDE TO RETIREMENT MATTERSAT LEAST 17% OF PEOPLE IN THE UK AGED 55 
AND OVER ADMIT TO HAVING NO PENSION 
SAVINGS (OTHER THAN THE STATE PENSION)[1].
opportunity to make their life a(er work 
more comfortable. 
ALARMING NUMBER 
At least 17% of people in the UK aged 
55 and over admit to having no pension 
savings (other than the State Pension), 
which is only slightly better than the 
average for Britons as a whole – 21% of 
whom say they have no private pensions.
What this research shows is that an 
alarming number of people are e!ectively 
‘sleepwalking’ towards their retirement 
without adequate preparations. But, there 
are signs that as people grow older, they 
are becoming aware that a lack of pension 
savings is a problem – though perhaps not 
quickly enough. 
PENSION DEFICIT 
"e issue is most visible among adults 
aged under 35. Nearly a quarter (24%) 
of this group claim to have no pension 
savings at all, despite being a generation 
to bene$t from auto-enrolment into 
workplace pensions. A(er 35 this drops to 
one in $ve, and then to one in six for the 
over-55s. Clearly, people do start to save 
more as retirement draws nearer, even if 
they have missed out on the opportunity 
to save over many years.
Lack of pension savings is a particular 
issue for those not in full-time 
employment. Encouragingly, just 8% of 
respondents who worked full time said 
they had nothing in their pension. But 
among part-time workers this $gure was 
one in four (24%), indicating that part-
timers face a potential pension de$cit 
when they retire. 
WORRYING STATISTIC 
"e people worst a!ected tend to be those 
currently not working at all – whether 
because they are unemployed or because 
they are full-time parents. Nearly 60% 
of this group said they had no pension 
savings. Where this is because of full-time 
parenthood, the parent in question may 
be relying solely on their partner’s pension 
in later life. "is is a risky strategy, both 
because that pension may not be enough 
for both of them, and because of the risk 
of relationship break-up.
Another worrying statistic highlights 
that one in $ve people simply don’t know 
how much they have in their pension 
savings. Curiously, this uncertainty grows 
rather than shrinks as people get older: 
while 14% of under-35s are unsure, this 
rises to 22% between the ages of 35 and 
54, and then to 24% among the over-55s.
SUBSTANTIAL INCOME
It may be the case that many of those 
who think they have no pension savings 
are wrong, and that they do have pension 
pots from previous jobs (or even their 
current job) that they don’t know about. 
"e $rst step for anyone who thinks 
they are pension-less is to contact the 
government’s Pension Tracing Service and 
search through their previous employers 
to see if they were ever a scheme member.
However, some people will reach the age 
of 55 (the earliest age that someone can 
access pension pots) and $nd that they 
genuinely have no pension savings. But this 
isn’t a reason to give up and assume it’s too 
late. Although a person close to retirement 
has a lower chance of saving enough to 
provide a substantial income, pensions 
can help your money to go a lot further. 
If you're in this situation, it's important to 
take action as soon as possible. l
Source data:
[1] Survey by Unbiased and Opinium of 
2,000 non-retired UK adults, conducted 
June-July 2020.
06      |      GUIDE TO RETIREMENT MATTERSR E T I R E M E N T 
I N C O M E  C R I S I S
With the right plans in place, you can make your money go further
Despite the fact that most people 
know they need to start saving 
for retirement as early as possible, 
many are still not doing so. "ere are a 
number of reasons why people aren't saving 
enough for their retirement. 
For some, it's simply because they don't 
have the spare cash to put into a pension 
pot. Others may feel like they're too young 
to start thinking about retirement, or that 
they'll never be able to save enough anyway.
"ere is no doubt that the UK is facing 
a retirement income crisis. With wage 
stagnation and rising living costs, many 
people are struggling to save enough for 
their later years.
NEVER TOO LATE TO START 
SAVING FOR RETIREMENT
Whatever the reason, it's important to 
remember that it's never too late to start 
saving for retirement. Even if you only have 
a small amount of money to put away each 
month, it will all add up over time. And, 
with the right plans in place, you can make 
your money go further.
"is is particularly true for those on 
lower incomes, who are o(en unable 
to access employer-sponsored pension 
schemes. "e situation is made worse by 
the fact that the State Pension is not enough 
to live on, and many people may not be 
eligible for it.
ADDRESSING THE RETIREMENT 
INCOME CRISIS
"e government has introduced a number 
of measures to try to address the retirement 
income crisis, but these have so far failed to 
make a signi$cant impact. "e situation is 
only likely to worsen in the future, unless 
action is taken.
"e average earner in their thirties is 
on track to see their pension pot reduce 
by £15,000 by the time they retire due to 
wage stagnation. "e $ndings from a recent 
Retirement Report[1] has revealed that 
the average earners in their 30s who were 
auto-enrolled in a company pension scheme 
in 2012 will have potentially contributed 
£7,000 less by 2024.
COPING WITH THE 
FINANCIAL PRESSURES
"ese ‘lost contributions’ result in an 
overall £15,000 reduction to the individual’s 
total pension pot at retirement due to lost 
compound interest. "e survey found that 
four out of $ve adults (81%) are concerned 
about making ends meet in the current cost 
of living climate, with three-quarters (76%) 
saying they need to take action to cope with 
the $nancial pressures. 
"e study revealed that over a third 
(35%) plan to cut back on non-essential 
leisure and holiday spending, while others 
are being forced to make harder decisions, 
such as cutting back on essentials like food 
and utilities (16%).
SUSTAINING A DECENT LIVING 
IN RETIREMENT
UK pension contribution rates over the 
past few decades have been chronically 
low compared to European countries and, 
for the average saver, a joint employee-
employer contribution rate of 8% will 
not be enough to sustain a decent living 
in retirement, leaving people with less 
retirement income over and above the 
basic safety net of the State Pensions and 
retirement bene$ts.
Over half (57%) of those surveyed said 
they were concerned about their $nances in 
retirement, while a similar number (50%) 
revealed they don’t feel they are preparing 
adequately for retirement.
INVESTMENT RETURNS 
ARE IMPORTANT 
Almost a $(h (18%) said their pension 
savings are invested in cash or cash-like 
assets, or low-risk assets such as UK 
Government bonds, or that they are planning 
to invest their pension in such assets.
"is means, according to the report, the 
average person between 35 and 54 years 
old – an age when investment returns are 
important – who holds half of their £36,200 
pension savings fully in cash could be 
exposed to a reduction of over £1,300 in a 
single year in real terms, and over £2,100 in 
two years. l
Source data:
[1] !e survey for Scottish Widows included 
general questions on pensions and retirement 
planning and was carried out online by 
YouGov Plc: across a total of 5,025 adults aged 
18+, weighted to be representative of the GB 
population, and separately for 1,002 adults 
aged 18+ to better understand the retirement 
prospects of minority ethnic groups. Fieldwork 
was carried out between 8–15 March 2022 
for the nationally representative survey, and 
between 8–30 March 2022 for the survey 
focused on minority ethnic groups, through a 
15-minute online survey.
OVER HALF (57%) OF THOSE SURVEYED 
SAID THEY WERE CONCERNED ABOUT 
THEIR FINANCES IN RETIREMENT[1].
07      |      GUIDE TO RETIREMENT MATTERSE N J O Y I N G  A 
C O M F O R T A B L E 
R E T I R E M E N T
Steps you can take to ensure that you are prepared "nancially
One of the biggest concerns people 
have when nearing retirement 
is whether or not they will have 
enough money to maintain their current 
lifestyle. Retirement can be a time of great 
uncertainty, but there are steps you can take 
to ensure that you are prepared $nancially.
A new study[1] shows that only 25% of 
retirees feel very con$dent they’ve saved 
enough for retirement.  As food prices 
continue to soar and petrol costs reach an 
all-time high in the UK, the rising cost of 
living is without doubt having an impact on 
many people's $nancial plans, both short 
and long term. 
If you’re approaching retirement or have 
already started taking money from your 
pension or other retirement savings, you 
wouldn’t be alone in feeling a little anxious 
about the e!ect the cost of living crisis 
might have on your lifestyle in retirement.
While it’s impossible to predict the future 
with complete certainty, there are a few 
things you can do to feel more con$dent 
about spending your money in retirement.
ADD UP ALL YOUR SOURCES 
OF INCOME
Your main source of retirement income 
may well be your pension plan. But when 
it comes to planning your $nances in 
retirement, it’s important to think beyond 
this. Consider other potential sources such 
as Individual Savings Accounts (ISAs) and 
other investments, as well as any rental 
income you receive from rental properties 
you let.
And don’t forget the State Pension, 
which is currently £185.15 a week (£9,628 
a year) for a single person with a full 
entitlement. Although the State Pension’s 
annual increase is currently below 
in)ation, every little helps and the total of 
all your savings and income might add up 
to more than you think.
WATCH OUT FOR UNNECESSARY 
TAX BILLS
Paying too much tax in retirement is a 
common pitfall for some retirees, and one 
that could be potentially avoided by having 
the right plans in place.
If you’re already taking or plan to take 
income from multiple sources, you need to 
consider how that will be taxed. When and 
how you take your money can make a big 
di!erence to how much tax you pay and 
how long it will last. Taking money little and 
o(en could make all the di!erence when it 
comes to reducing your tax bill.
When it comes to your pension savings, 
you can typically take 25% tax-free from 
age 55 (age 57 in 2028), either in one go or 
08      |      GUIDE TO RETIREMENT MATTERSspread out over a longer period. A(er this, 
any money you take from your pension 
savings, as well as your State Pension, is 
taxable just like any other income. "at 
means you’ll need to pay income tax on 
anything over your tax-free cash limit and 
any annual personal Income Tax allowance 
you get.
It’s likely that the more money you take, 
the more tax you’ll have to pay, although 
how much will depend on which tax band 
your income falls into. So if you take all of 
your pension savings at once, or in big lump 
sums, you could be paying more tax than 
you need to. But by taking your pension 
savings over a number of years and taking 
just enough to stay in the lowest tax band 
you can, you could keep more of your 
money overall.
MAKE THE MOST OF 
YOUR INDIVIDUAL SAVINGS 
ACCOUNT (ISA)
Another way to avoid an unnecessary tax 
bill is to make the most of your ISA savings. 
You don’t pay tax on any investment growth 
or interest you earn, or on the proceeds you 
take from an ISA. So it’s a very tax-e#cient 
way to save.
You could consider using any ISA savings 
you have $rst and delay accessing your 
pension savings, giving them more time 
to stay invested and potentially grow in 
value. Remember though, the value of all 
investments can go down as well as up, and 
you may get back less than you paid in.
Or, if you’ve already started taking an 
income from your pension, you could 
use your ISA savings to supplement that 
income. "is could allow you to take 
smaller payments from your pension and 
avoid overpaying Income Tax on them.
Getting to grips with tax implications 
can be a bit overwhelming as there’s a lot 
to consider. Tax rules and legislation can 
change, and personal circumstances and 
where you live in the UK also have an 
impact on your tax treatment. On top of 
that, tax varies for other sources of income 
like property, state bene$ts, or even your 
salary if you’re planning on working in 
some capacity for a little longer.
KEEP TRACK OF YOUR 
INVESTMENTS
Where your money is invested could have 
the biggest impact on how long it will last 
in retirement. It’s important to regularly 
review your investments to make sure they 
remain on track and remain aligned with 
your plans and attitude to investment risk.
For example, your pension savings may 
be invested in fairly high-risk funds that 
have the potential to grow signi$cantly 
in value, but also are more likely to be 
impacted, particularly during periods of 
market volatility. Moving to lower-risk 
investments means that you’re less likely to 
see big ups and downs in the value of your 
pension savings.
However, if you’re relying on your 
pension savings to provide you with a 
comfortable income for the rest of your 
life, you also need to make sure that your 
investments will provide enough growth 
potential. "is is particularly important in 
the current climate where your money faces 
the double challenge of rising in)ation and 
potentially having to last for many years. l
Source data:
[1] Class of 2022 UK retirement report 
consumer research of 2,000 UK adults for abrdn 
who were either planning to retire in the next 
12 months, or who had retired in the 12 months 
prior.  Research was conducted by Censuswide 
in late November / early December 2021.
ONLY 25% OF RETIREES FEEL VERY CONFIDENT THEY’VE SAVED 
ENOUGH FOR RETIREMENT[1].
09      |      GUIDE TO RETIREMENT MATTERSG E N D E R 
P E N S I O N S  G A P
Women’s pensions at retirement are half the size of men’s
The gender pensions gap is the 
di!erence in the average amount of 
money that men and women have 
saved for retirement and it begins at the very 
start of a woman’s career.
Women are more likely to take breaks 
from work to raise children or care for 
relatives, which can reduce their earnings 
and pension contributions over time. "ey 
also tend to live longer than men, meaning 
they need to have enough saved to last them 
through retirement.
As a result, women’s pensions at 
retirement are half the size of men’s, 
regardless of the sector they work in, 
research has highlighted[1]. 
LONG-TERM 
FINANCIAL IMPACT 
"e research found that every single 
industry in the UK has a gender pensions 
gap, even those dominated by female 
workers. Considering women are likely to 
live four years[2] longer than men, this issue 
deepens as they need to have saved around 
5% to 7% more at retirement age. 
Worryingly, more than a third (38%) of 
women who have taken a career break were 
not aware of the long-term $nancial impact 
it would have on their pension.
THREE KEY INDUSTRIES
According to the research, the gender 
pensions gap exists regardless of average pay 
across di!erent sectors, and ranges from 
a gap of 59% in the healthcare industry to 
13% in courier services.
"e healthcare (59%), construction 
(51%), real estate/property development 
(48%), pharmaceutical (46%), aerospace, 
defence and government services (46%) 
and senior care (45%) sectors were found 
to have the largest gender pensions gaps. 
Of these six sectors, three are key industries 
for female employment – healthcare, 
pharmaceuticals and senior care[3].
"ere are many reasons for the gender 
pensions gap, ranging from women holding 
fewer senior positions and being paid less, 
resulting in lower pensions contributions, to 
the fact they are more likely to take career 
breaks due to caring responsibilities. 
GENDER CONFIDENCE GAP 
Another potential driver is a signi$cant 
gender con$dence gap when it comes 
to managing pension pots. More than a 
quarter (28%) of women said they had 
con$dence in their ability to make decisions 
about their pension, compared to almost 
half (48%) of men[5]. 
"is lack of con$dence extends further to 
other $nancial decisions, with women less 
likely than men to feel con$dent managing 
their investments (22% of women versus 
41% of men) and their savings (56% of 
women versus 67% of men).
While many factors behind the gender 
pension gap are out of most people’s 
control, there are some actions you can 
take to help reduce it:
n Contribute as much as you can to
 
your pension – and start early.
 
Compound interest remains hugely   
 
underrated and poorly understood by  
 
both some men and women.
n Check the charges on your historic  
 
 
pension pots. If appropriate, see if  
 
10      |      GUIDE TO RETIREMENT MATTERS 
consolidating your pots will bring 
 
them down.
n Check how much your State Pension will  
 
be and when you'll get it. If it’s not going  
 
to support your ideal lifestyle, plan how  
 
you’ll cover any shortfall.
n Put a bit more into your pension  
 
 
whenever you get a pay rise.
n Talk through your pension planning   
 
with your partner. Make sure you  
 
 
know about each other’s saving plans,  
 
contribution limits and that you are both  
 
on the same page.
n Keep a regular eye on your pension to  
 make sure you’re in full control of it and  
 
saving for your ideal future.
"ere are a number of ways to close 
the gender pensions gap. Employers can 
o!er )exible working arrangements that 
allow women to balance work and family 
life. Governments can also provide tax 
incentives for pension contributions. 
And $nally, individuals can look to save 
more for retirement. l
Source data:
[1] !e analysis is based on LGIM’s 
proprietary data on c.4.5 million de"ned 
contribution members as at 1 April 2022 but 
does not take into account any other pension 
provision the customers may have elsewhere.
[2] ONS: Life expectancy at birth in the UK: 
82.9 years for women vs 79 years for men; 
O#ce for National Statistics, 2018–2020. 
Average four years.
[3] According to the ratio of female members 
across the Legal & General book of business.
[4] Legal & General Insight Lab survey of 
2,135 workplace members was conducted 
between 4–26 July 2022.
[5] Opinium survey of 2,001 UK adults was 
conducted between 4–8 February 2022.
MORE THAN A THIRD 
(38%) OF WOMEN WHO 
HAVE TAKEN A CAREER 
BREAK WERE NOT 
AWARE OF THE LONG-
TERM FINANCIAL IMPACT 
IT WOULD HAVE ON 
THEIR PENSION[4].
11      |      GUIDE TO RETIREMENT MATTERSOlder people in the UK are 
increasingly returning to work, 
according to new research[1]. 
"e cost of living crisis is now a!ecting 
many pensioners drastically. "e research 
also found that the proportion of older 
people who are self-employed has more 
than doubled over the same period.
It is clear that many older people are 
choosing to return to the workforce and this 
trend is likely to continue as the population 
ages and more people reach retirement age.
"e $ndings from the research identi$ed 
economic activity levels among the over-
50s are now at their highest level since the 
COVID-19 pandemic began.
IMPACTING PENSIONS 
Analysis of o#cial statistics appears to show 
the $rst signs of a return to the long-term 
trend of more economically active people 
over the age of 50 – a decades-long trend 
which, it said, was reversed by the pandemic.
Spiralling in)ation, a cost of living crisis 
and turbulent $nancial markets impacting 
pension funds are causing some people to 
unretire and $nd work again. "ere has 
been an increase in economic activity (those 
in work or looking for work) of 116,000 
among the over-50s in the past year. More 
than half of the increase is being driven by 
men over the age of 65.
RETIRING COMFORTABLY 
In some ways, the pandemic forced 
the hands of many and gave them an 
opportunity to trial retirement. An 
early retirement can o(en seem like a 
dream when you’re stuck in the thick of 
the daily grind but, for many, giving up 
work abruptly can also result in a loss of 
structure, social connections and purpose, 
which can leave people feeling lost at times.
"e current economic climate means that 
some people who thought they could retire 
comfortably during the pandemic are now 
having to unretire and $nd work again to 
bring in some extra income and top up their 
pensions while they still can.
If you're an older person considering a 
return to work, there are a number of things 
to think about. 
Here are some tips:
n Make sure you're up to date with the
 
latest skills and technologies. Older   
 
workers may need to brush up on their  
 
computer and social media skills.
n Consider )exible working arrangements.  
 Many employers are now o!ering part- 
 
time, )exible, or remote working options  
 
which can be ideal for older workers.
n Don't be afraid to negotiate. Older
 
workers o(en have a wealth of  
 
 
experience and knowledge to o!er, so
 
don't be afraid to ask for what you're worth.
Returning to work can be a great way 
to stay active, engaged and earn some 
extra income. With a little planning 
and preparation, it can be a smooth and 
enjoyable transition.
Source data:
[1] Analysis by www.restless.co.uk – 
Economic activity levels amongst people 
over the age of 50 hit their peak of just over 
11 million just before the pandemic in the 
three-month period from December 2019 – 
February 2020. Since then, we have seen a 
decades-long trend reverse, with economic 
activity levels of workers aged over 50 falling 
by as much as 223,000 during the pandemic.
C O S T  O F  L I V I N G 
C R I S I S
Signs of more economically active people over the age of 50
THERE HAS BEEN AN INCREASE IN 
ECONOMIC ACTIVITY (THOSE IN WORK OR 
LOOKING FOR WORK) OF 116,000 AMONG 
THE OVER-50S IN THE PAST YEAR.
12      |      GUIDE TO RETIREMENT MATTERSH E A L T H Y 
P E N S I O N  P O T
Ways to maximise the value of your retirement savings
13      |      GUIDE TO RETIREMENT MATTERSIf you’re aiming to build a healthy 
pension pot to fund your retirement, 
there are a few key mistakes you’ll want 
to avoid. "ese can set you back and make it 
harder to reach your goals. 
Understandably, many people are 
feeling the pressure on their $nances at 
the moment due to the backdrop of rising 
in)ation and the cost of living soaring. In 
these circumstances, it can be di#cult to 
think about your long-term $nances or even 
contemplate saving for the future. 
However, even in the current climate 
there are ways to maximise the value of any 
pension savings you do have.
!e most common mistakes people 
make when trying to build their UK 
pension pot:
FREE MONEY FROM YOUR 
EMPLOYER 
When o!ered the opportunity to join a 
workplace pension, it’s nearly always a 
good idea to do so. For most people, your 
employer must automatically enrol you in 
a workplace pension scheme, and you may 
even be o!ered a pension plan if you don’t 
meet the criteria. 
Workplace pension schemes are made 
up of your own payments (5% or more of 
earnings) which are deducted from your 
salary, o(en before you pay tax, making 
it easier to save, and your employer’s 
contribution, which at the very least must 
be equivalent to 3% of your earnings. 
Many employers o!er more than this or 
match any extra payments you make, so it’s 
worth checking if you’re getting the most 
out of this valuable bene$t.
EXTRA MONEY FROM THE 
GOVERNMENT 
Anyone who decides against investing in a 
workplace or personal pension also turns 
down help from the government. "at’s 
because in order to encourage people 
to save for retirement, the government 
provides a top-up called ‘tax relief ’ to 
pension payments. 
How you receive tax relief depends on the 
type of plan you have and the rate of income 
tax you pay. But as an example, if you’re a 
basic rate taxpayer saving into a personal 
pension in the current tax year, you get 20% 
tax relief on your payments. So, if you pay 
£200 a month into your pension plan, the 
£40 of tax relief you receive on that payment 
means it will only cost you £160. Higher 
rate or additional rate taxpayers could claim 
back even more.
Some workplace pension schemes o!er 
tax relief in a di!erent way, such as through 
salary sacri$ce or exchange schemes, so 
check with your employer if you’re not sure 
how this works for you. And in Scotland, 
the tax relief details di!er slightly. But in all 
these cases, the general point is the same: 
each time you defer paying into a pension 
plan, you miss out on an extra boost.
THE STATE PENSION WILL NOT 
TO COVER EVERYTHING 
Another common mistake is to assume that 
the State Pension will meet your retirement 
needs. However, it’s important to know that 
the State Pension won’t be available until 
your late 60s and may not cover all of your 
outgoings. 
Currently, pensioners who are entitled 
to the full new single-tier State Pension get 
£185.15 a week in 2022/23, worth £9,627.80 
for the year. But remember that what you 
get depends on your National Insurance 
record, so you could get less.
Pensioners who reached State Pension 
age before April 2016 and receive the 
basic State Pension get £141.85 a week, or 
£7,376.20 a year.
KEEP A TRACK OF ALL YOUR 
PENSION PLANS 
If you have moved jobs or home a few times 
and not informed your pension provider, 
then one of these ‘lost’ pension pots could 
be yours. It’s worth spending time tracking 
down any potential missing pots to help 
boost your future $nances.
THE MINIMUM CONTRIBUTION IS 
UNLIKELY TO BE ENOUGH 
Auto-enrolment has boosted the pension 
savings of millions of people but the 8% 
minimum payment may not get you the 
retirement lifestyle you want. It’s important, 
therefore, to have a retirement lifestyle in 
mind – the PLSA calculations can be helpful 
here as they can give you a real $gure to 
aim for, and you can then work out what’s 
feasible and put the necessary steps in place 
to help you achieve your goals.
REVIEW YOUR PENSION 
PLAN REGULARLY 
You might not want to talk about your 
pension plan every day, but dismissing 
pensions as boring is a mistake, and one 
that becomes increasingly serious over time. 
While this might be di#cult at the moment, 
steps such as topping up your payments, 
especially in your 20s, 30s or early 40s, 
can make a large di!erence, thanks to the 
snowball e!ect of compounding. 
Understanding your workplace or private 
pension, making sure you know how to get 
more ‘free’ payments from your employer 
or the government, or using it to pay less 
tax (such as through bonus sacri$ce) could 
make a major di!erence to your long-term 
$nances.
UNDERSTAND WHERE YOUR 
POT IS INVESTED
A related mistake is not knowing where 
your pension pot is invested, whether that 
matches your life-stage and priorities or 
how to choose the right investment options. 
For example, if your retirement is still some 
years ahead, you could potentially a!ord to 
take a little more risk. Conversely, you may 
want to dial down the risk as you get nearer 
to retirement. l
WHEN OFFERED THE OPPORTUNITY TO JOIN A WORKPLACE PENSION, 
IT’S NEARLY ALWAYS A GOOD IDEA TO DO SO. 
14      |      GUIDE TO RETIREMENT MATTERSWhen it comes to planning for 
your retirement, one important 
factor to consider is the impact 
of in)ation on your future pension income. 
While the cost of living will obviously 
increase over time, the rate of in)ation can 
have a signi$cant impact on how far your 
pension income will go in retirement. 
While there are ways to help protect 
yourself from the e!ects of in)ation (such 
as investing in assets that tend to keep up 
with or exceed the rate of in)ation), it's still 
important to be aware of how it can impact 
your retirement plans.
FUTURE RETIREMENT INCOME 
Retirement planning can be complex at the 
best of times, so it is easy to understand 
how some people can $nd it daunting to 
take into account factors like in)ation. "e 
reality is that in)ation hurts everyone, but it 
can be especially harmful to retirees.
Whether it’s the price of food, fuel, 
energy or other goods and services that we 
purchase, in)ation is de$nitely increasing. 
"e current economic climate clearly 
illustrates just how important it is to 
consider the impact of in)ation on your 
future retirement income and take proactive 
steps to manage this.
REACHING HISTORIC HIGHS
Just two out of $ve (37%) over-55s have 
planned for the impact of in)ation on 
their spending power when they stop 
work, according to new research[1]. As the 
consumer price in)ation continues to reach 
historic highs, many over-55s who are either 
approaching retirement or have retired 
are facing an in)ation shock as they try to 
manage their retirement income. 
Indeed, 41% admitted they had not 
planned for in)ation or did not know 
whether they had. "e other 22% say they 
just have not planned their retirement 
income at all. Interestingly, the current 
discussion around in)ation has impacted 
people’s approach to retirement, with 43% 
of those who are working full-time planning 
to factor this challenge in – up from 39% of 
those who have already retired.
RETIREMENT SPENDING POWER 
"e current challenging economic situation 
is also encouraging a more thoughtful 
approach to retirement, with only 15% 
of the employed confessing to a lack of 
retirement planning compared to 23% of 
those who are already retired.
Among those who say they have 
planned for the impact of in)ation on their 
retirement spending power, more than a 
third (34%) say they can rely on the State 
Pension keeping pace with rising prices 
while 33% believe their company pension 
will rise in line with in)ation. 
INFLATION ROSE SHARPLY
As well as looking to the State Pension and 
company pensions, the 30% of those who 
have prepared for in)ation say they have 
anticipated the need for their income to 
rise each year and have approached their 
savings accordingly.
Around a quarter (26%) say they have 
considered how much spending they might 
need to cut if in)ation rose sharply.  "e 
main reason for failing to take account of 
in)ation was its unpredictability – 31% 
say they did nothing because they could 
not forecast it, while 30% say they had 
been caught out by the recent increase in 
in)ation a(er years of stability.
 
EXPLORE DIFFERENT OPTIONS
"e importance of future-proo$ng your 
$nances is clearly moving up the agenda 
and when you compare retirees with those 
over-55s who are still working, you can 
see that the recent in)ation shock has 
encouraged people to plan more carefully. 
No one wants to $nd that as they age, 
they need to cut back more and more 
just to make ends meet. While saving 
as much as possible for retirement and 
careful planning are clearly important, it 
is also vital to consider all your assets and 
to explore di!erent options, whether it is 
boosting your tax-free savings, downsizing 
or accessing your housing equity. l
 
Source data:
[1] Key Advice 18 May 2022.
E F F E C T S 
O F  I N F L A T I O N
Being aware of how it can impact your retirement plans
JUST TWO OUT OF FIVE (37%) OVER-
55s HAVE PLANNED FOR THE IMPACT OF 
INFLATION ON THEIR SPENDING POWER 
WHEN THEY STOP WORK[1].
15      |      GUIDE TO RETIREMENT MATTERSHow much you'll need to retire 
depends on a number of factors, 
including how long you expect to 
live in retirement and what kind of lifestyle 
you want to maintain. 
One of the biggest mistakes you can 
make is not saving enough for your 
retirement. "is can leave you struggling 
to make ends meet in your later years, and 
may even force you to rely on others for 
$nancial support. It’s never too early to 
start saving, and the sooner you start, the 
better o! you’ll be. 
"e question of whether or not you 
are saving enough for your retirement is 
a di#cult one to answer. It depends on a 
number of di!erent factors, including your 
age, your current income, your anticipated 
expenses in retirement and the amount of 
time you have le( to save.
COST OF LIVING CRISIS
According to a new survey, just over a 
quarter of savers surveyed (26%) who 
have a workplace pension think that their 
current amount of pension saving will not 
be enough to get by on when it comes time 
to retire[1].
With UK households feeling the 
pinch o! the back of the cost of living 
crisis, the war in Ukraine and two 
years of COVID-19 restrictions, savers 
have reported that they have long-term 
concerns as to their $nancial health when 
they stop working.
LOW-INCOME HOUSEHOLDS 
In the survey, those aged between 35 and 
54 (29%) were most concerned that they 
wouldn’t have enough to live o!, compared 
to those aged over 55 (20%). Just under 
a third of women were concerned (31%), 
compared to one in $ve men (21%).
Furthermore, 35% of those in low-
income households whose total income 
is up to £14k, and 31% with an income 
of £14k–£28k, stated their concerns. "is 
$gure drops to just one in $ve (20%) for 
those in households with an income of 
over £48k.
MINIMUM STANDARD OF LIVING
One in $ve people surveyed (21%) who 
have a pension say that they save into 
a pension to ensure that they have a 
minimum standard of living in retirement 
– a pension that meets all their basic needs.
"e $ndings show that a majority of 
people save to get either a moderate (41%) 
or comfortable (33%) Retirement Living 
Standard. However, far fewer people 
think their current pension saving will 
achieve this, with slightly over a quarter 
(27%) saying moderate and just 14% 
comfortable.
REACHING YOUR FUTURE GOALS 
"ere are some key questions that will help 
give you a sense of whether you’re saving 
enough for retirement. "ese include: How 
much have I saved so far? How much will I 
need to save? What is my expected rate of 
return? What sources of income will I have 
in retirement? 
Keep in mind that these are just general 
guidelines. "e best way to know if 
you’re on track for retirement is to obtain 
professional $nancial advice to develop a 
personalised retirement plan and make sure 
you’re on track to reaching your goals.
SAVE A LITTLE BIT EACH MONTH
No matter what your speci$c retirement 
goals are, it's important to start saving early 
and o(en. "e sooner you start saving, the 
more time your money has to grow, and the 
less you'll need to save overall. 
So if you're not already doing so, start 
setting aside money for retirement now. 
Even if you can only a!ord to save a little bit 
each month, it will add up over time. l
Source data:
[1] !e research was conducted on behalf 
of the PLSA by Yonder Data Solutions from 
10/01/22 to 11/01/22 with a nationally 
representative sample of 2,093 adults.
S T A R T  S A V I N G 
E A R L Y  A N D  O F T E N
What kind of lifestyle do you want to maintain?
ONE IN FIVE PEOPLE SURVEYED (21%) WHO 
HAVE A PENSION SAY THAT THEY SAVE 
INTO A PENSION TO ENSURE THAT THEY 
HAVE A MINIMUM STANDARD OF LIVING IN 
RETIREMENT[1].
16      |      GUIDE TO RETIREMENT MATTERSThe traditional retirement age is no 
longer what it used to be. More and 
more people are choosing to retire 
early, and there are a number of reasons why 
this is becoming increasingly popular.
One of the biggest reasons for embracing 
early retirement is the fact that people are 
living longer and healthier lives. "is means 
that they can enjoy their retirement years 
more, and don’t have to worry about health 
issues as much.
MAKE SURE YOU’RE 
FINANCIALLY PREPARED 
Another reason for retiring early is that 
many people simply want to enjoy their 
lives sooner rather than later. "ey don’t 
want to wait until they’re 65 or older to start 
enjoying life, and so they retire early instead.
Whatever your reasons for wanting to retire 
early, it’s important to make sure that you’re 
$nancially prepared for it. Make sure you have 
enough saved up to cover your costs.
ENJOYING A MORE 
RELAXED LIFESTYLE
Of course, there are also $nancial 
considerations to take into account when 
deciding whether or not to retire early. For 
some, it may be based on health reasons, 
while others may want to take advantage 
of government bene$ts or simply enjoy a 
more relaxed lifestyle. However, one of the 
most common factors that determines when 
people choose to retire is their age.
So, what is the most popular age to retire 
early? Sixty is the most popular age to retire 
early, according to new research[1] which 
reveals the key steps people have taken to 
embrace early retirement and examines the 
costs and bene$ts of doing so.
WANTING TO ENJOY 
MORE FREEDOM 
One in four (25%) are planning to celebrate 
their 60th birthday by leaving work behind. 
With the State Pension age currently 
standing at 66, the $ndings show one in 
six (17%) people who have taken early 
retirement did so when they were 60, 
making it the most common age to make an 
early exit from working life. 
"is is also the most popular target age 
for people who intend to retire early in 
the years ahead, with one in four (25%) 
planning to celebrate their 60th birthday 
by leaving work behind. "e desire to 
retire early is primarily driven by ‘wanting 
to enjoy more freedom while still being 
physically $t and well enough to enjoy it.’
EMBRACING A NEW LIFESTYLE
Nearly one in three (32%) people who 
have retired early or plan to do so gave 
this reason for embracing a new lifestyle. 
Financial security is the second most 
common factor prompting people to 
embrace retirement. More than one in 
four (26%) early retirees say their decision 
was a result of ‘being in a $nancially stable 
position’ so they can a!ord not to work.
"e in)uence of money matters is also 
visible in people’s choice of early retirement 
age. One in $ve (20%) people targeting early 
retirement have set their sights on 55 to 
make the transition from working life. "is 
is likely to be in)uenced by their ability to 
access their pension savings from this age.
‘TOO TAXING AND STRESSFUL’ 
Other key factors encouraging people to 
seek early retirement include reassessing 
their priorities and what’s important to 
them in life (23%), wishing to spend more 
time with family (20%) or $nding they are 
either ‘tired and bored’ of working (19%) or 
$nd it ‘too taxing and stressful’ (19%).
"e research suggests the impacts of early 
retirement are wide-ranging and broadly 
positive in many areas of life. Most notably, 
more than two in three (68%) people 
who have retired early say their happiness 
improved as a result. In terms of the world 
around them, 44% of early retirees say their 
family relationships improved and 34% 
reported improvements in their friendships.
E M B R A C I N G 
E A R L Y  R E T I R E M E N T
‘Enjoy more freedom while still being physically "t and well enough to enjoy it’
17      |      GUIDE TO RETIREMENT MATTERSONE IN FOUR (25%) 
ARE PLANNING TO 
CELEBRATE THEIR 60TH 
BIRTHDAY BY LEAVING 
WORK BEHIND[1].
BOOST TO MENTAL WELLBEING 
When it comes to their health and 
wellbeing, more than half report that early 
retirement has delivered a boost to their 
mental wellbeing (57%) and half (50%) say 
their physical wellbeing improved.
However, the $ndings suggest these 
bene$ts come at a cost, with nearly half 
of early retirees $nding their $nances 
worsening as a result (47%). 
Women are the most likely to have felt a 
negative $nancial impact from retiring early 
(50% vs. 44% of men). Across both genders, 
only 22% feel they have bene$ted $nancially 
from their decision to retire early.
STEPPING STONE TO 
RETIRING EARLY
Among those people who have retired 
early, one in three (32%) identify having a 
de$ned bene$t ($nal salary) pension among 
the main measures that enabled them to 
take retirement into their own hands. "is 
suggests the concept of early retirement 
may get harder for younger generations to 
achieve, with the majority of the private 
sector workforce now saving into de$ned 
contribution pension schemes.
However, the $ndings suggest that people 
can still take positive steps to make an 
early retirement possible. Paying o! your 
mortgage (30%) is identi$ed as the second 
most common stepping stone to retiring 
early, while almost three in ten early retirees 
(29%) say saving little and o(en was one 
of their main strategies. Nearly one in $ve 
(19%) say they also saved extra whenever 
they received a pay rise or a bonus during 
their working life.
THE MAIN MEASURES ENABLING 
PEOPLE TO RETIRE EARLY OR 
THINK ABOUT RETIRING EARLY
n 32% – Having a de$ned bene$t ($nal  
 
salary) pension
n 30% – Paying o! one’s mortgage
n 29% – Saving little and o(en
n 19% - Saving extra whenever receiving a  
 
pay rise or bonus
n 16% – Receiving a redundancy payout
n 14% – Receiving an inheritance
WANTING A NEW SENSE 
OF PURPOSE
Among those who take early retirement, 
the research also reveals there is a small 
contingent who have returned to work 
(17%) or envisage themselves doing so in 
the future (15%). Over one in four (27%) 
cite the reason for returning to work 
is because they ‘wanted a new sense of 
purpose’, making this the most frequent 
driver, followed by ‘missing the company 
and social interactions with colleagues’ 
(26%). However, a similar number (24%) of 
early retirees $nd themselves heading back 
to work having experienced $nancial issues.
While happiness soars in retirement, 
many people $nd their $nances take the 
strain when they retire early and money 
worries are one of the biggest factors 
resulting in people returning to work. If 
you aspire to retire early, it’s vital you plan 
your $nances to be sustainable for the 
long-term. l
Source data:
[1] https://www.aviva.com/newsroom/news-
releases/2021/12/sixty-the-most-popular-age-
to-retire-early/
18      |      GUIDE TO RETIREMENT MATTERSIf you’ve been saving into a de$ned 
contribution pension (sometimes called 
‘money purchase’) during your working 
life, from age 55 (age 57 in 2028) you need 
to decide what to do with the money you’ve 
saved towards your pension when you 
eventually decide to retire. 
Before you do anything, there are 
things you should consider. One is the tax 
implications of taking cash. Depending on 
how much money you withdraw, you may 
be liable for income tax on the sum. 
Another key factor is what you plan to 
do with the money to withdraw – if you're 
hoping to use it for retirement income, it's 
important to make sure that you won't run 
out of funds too quickly. 
It's also important to bear in mind that 
if you withdraw cash from your pension 
pot, you can't put it back in – so make sure 
you're certain that this is the right decision 
for you.
Note: this article doesn’t cover pension 
schemes where the pension you’ll be 
getting is worked out as a proportion of 
your pay.
HOW MUCH MONEY DO YOU 
NEED TO RETIRE?
Before you take any cash out of your 
pension, you need to calculate how much 
money you actually need. Do you need a 
lump sum of cash all at once? If so, what 
are the tax implications? Or would you be 
better o! with a regular income stream? 
Remember that retirement could be 
30 to 40 years, or more. As well as what 
you’ll need to cover everyday living 
expenses, do you have any speci$c plans 
for your retirement, such as regular 
holidays or enjoying a hobby? Or are you 
thinking of any big one-o! purchases 
or expenditure, like a new car or home 
improvements? Once you know how 
much money you need, you can start to 
look at your options.
WHAT ARE THE TAX 
IMPLICATIONS?
Taking cash out of your pension can have 
tax implications if you withdraw more 
than your tax-free element (typically 25% 
of your pension). You can leave the rest 
invested until you decide to make more 
withdrawals or set up a regular income. 
However, you need to make sure you 
understand those implications before you 
make any decisions. Otherwise, you could 
end up with a signi$cant tax bill that you 
weren’t expecting.
C A S H  M A Y 
N O T  B E  K I N G
Choosing what to do with your pension is a big decision
19      |      GUIDE TO RETIREMENT MATTERSWHAT ARE THE FEES?
When you retire and start taking money 
out of your pension, you may be charged 
fees by your pension provider. Some 
pension providers will charge a fee for each 
withdrawal you make, while others may 
charge a )at rate or percentage of your 
pension pot. 
"ere may also be other charges, such 
as an administration fee. Taking money 
out of your pension will also reduce the 
amount of income you have in retirement, 
so it’s important to think carefully before 
you decide to take any money out of your 
pension pot.
HOW LONG WILL THE 
MONEY LAST?
Consider how long you’ll need the money 
to last. If you take a lump sum of cash, it’s 
likely that it won’t last as long as if you take 
an income. "is is something to keep in 
mind when you’re making your decision.
WHAT IF YOU NEED MORE 
MONEY LATER?
If you take cash out of your pension now, 
it may not be there if you need it later on 
in life. "is is something to consider if you 
think you may need more money down 
the line. Even if you’ve seen the value of 
your pensions fall that doesn’t necessarily 
mean that you’ll have to delay your 
retirement altogether. 
Could you take less from your pension 
savings until their value recovers, and use 
other savings instead to bridge the gap? 
And could you put o! any big purchases 
you’d planned?
WHAT ARE THE RISKS?
Taking cash out of your pension comes 
with risks. "ere’s the risk that you could 
outlive your money or that the value of 
your pension could go down. You need to 
make sure that you understand all of these 
risks before you make a decision.
OPTIONS FOR USING YOUR 
DEFINED CONTRIBUTION 
PENSION IN RETIREMENT
n Keep your pension savings where they  
 
are – and take them later.
n Use your pension pot to buy a
 
guaranteed income for life or for a   
 $xed term – also known as a ‘lifetime’  
 
or ‘$xed term annuity’. "e income is  
 
taxable, but you can choose to take
 
up to 25% (sometimes more with  
 
 
certain plans) of your pot as a one-o!  
 
tax-free lump sum at the start.
n Use your pension pot to provide a
 )exible retirement income – also  
 
 
known as ‘pension drawdown’. You can  
 
take the amount you’re allowed to
 
take as a tax-free lump sum (normally  
 
up to 25% of the pot), then use the rest  
 
to provide a regular taxable income.
n Take a number of lump sums – usually  
 
the $rst 25% of each lump sum
 withdrawal from your pot will be tax- 
 
free. "e rest will be taxed as income.
n Take your pension pot in one go –   
 
usually the $rst 25% will be tax-free   
 
and the rest is taxable.
n Mix your options – choose any
 
combination of the above, using  
 
 
di!erent parts of your pot or 
 
separate pots. 
UNDERSTANDING THE 
DIFFERENT OPTIONS
"is is a very complicated topic and 
choosing what to do with your pension is 
one of the most important decisions you’ll 
ever make and will impact on your future 
standard of living in retirement.
Worryingly, over a third (35%) of 
pension holders do not know about the 
di!erent options available to them for 
when the time comes to retire, according to 
research[1]. l
Source data:
[1] Online omnibus conducted by Opinium 
in June 2021 for LV – 4,000 representative 
UK adults surveyed nationally.
OVER A THIRD (35%) OF PENSION HOLDERS 
DO NOT KNOW ABOUT THE DIFFERENT 
OPTIONS AVAILABLE TO THEM FOR WHEN 
THE TIME COMES TO RETIRE[1].
20      |      GUIDE TO RETIREMENT MATTERSC O M B I N I N G 
M U L T I P L E  P E N S I O N 
P O T S  I N T O  O N E 
S I N G L E  P O T
Simplify your "nances and make it easier to keep track of 
your retirement savings
21      |      GUIDE TO RETIREMENT MATTERSIf you have ever changed jobs, moved 
homes or had a company you worked 
for change ownership or close down, 
then you know how easy it is to lose touch 
with your pension savings provider. "is can 
happen for a variety of reasons, but it o(en 
means that your savings are no longer as 
secure as they could be.
"e employment landscape has evolved 
signi$cantly over the last few decades 
and changing jobs multiple times before 
retirement is now very much the norm. 
But did you know, there is an estimated 
£9.7 billion of unclaimed UK de$ned 
contribution pension funds?[1].
VALUABLE PENSION SAVINGS 
All these events over time may make it 
very di#cult to $nd your valuable pension 
savings. So that means potentially ending 
up with a number of di!erent pension 
pots. If you’re one of the millions of 
people with multiple pensions, it may be 
appropriate to consider consolidating your 
de$ned contribution pension pots and 
bring them together. 
While it can be di#cult to keep track of 
your pension savings, it is important to do 
what you can to protect your hard-earned 
money. By taking a few simple precautions, 
you can help ensure that your savings are 
always accessible and secure.
NUMBER OF 
DIFFERENT PENSIONS 
Even if you have not had many jobs, you 
could still have a number of di!erent 
pensions to keep track of. If appropriate, 
pension consolidation can simplify your 
$nances and make it easier to keep track of 
your retirement savings.
Having said this, not all pension types 
can or should be transferred. It’s important 
to obtain professional advice so you 
know and can compare the features and 
bene$ts of the plan(s) you are thinking of 
transferring.
WHAT IS PENSION 
CONSOLIDATION?
Pension consolidation is the process of 
combining multiple pension pots into one 
single pot. "is can be done with a pension 
transfer or by opening a new pension and 
transferring your other pensions into it. 
You may want to do this to make it easier 
to keep track of your retirement savings, 
or to try and get a better rate of return on 
your investment.
But there are a few things to consider 
before consolidating your pensions, such 
as any exit fees that may be charged, and 
whether or not you will lose any valuable 
bene$ts such as guaranteed annuity rates.
CONSOLIDATING 
YOUR PENSIONS
Reasons why you may not want to 
consolidate your pensions:
Simplify your "nances: If you have 
multiple pension pots, it may be di#cult to 
keep track of them all. Consolidating your 
pensions into one pot could make it easier 
to manage your retirement savings.
Save on fees: If you have multiple pensions 
with di!erent providers, you may be 
paying multiple annual fees. Consolidating 
your pensions may help you save money 
on fees.
Get better investment options: Some 
pension providers o!er a limited number 
of investment options. By consolidating 
your pensions it could give you access to a 
wider range of investments.
REASONS WHY YOU MAY 
NOT WANT TO CONSOLIDATE 
YOUR PENSIONS
Loss of valuable bene"ts: One key 
disadvantage is that you may lose out 
on valuable bene$ts that are speci$c to 
certain pension schemes. For example, 
some schemes may o!er better death 
bene$ts than others, so consolidating your 
pensions into one pot could mean giving 
up this valuable protection.
Paying higher fees: Another potential 
downside is that some schemes may have 
higher charges than you are actually 
currently paying, which means you 
would end up paying higher fees. "is 
is something that needs to be carefully 
considered before making any decisions.
More di#cult to access: It’s important to 
remember that once you consolidate your 
pensions, it may be more di#cult to access 
them early if you need the money for an 
emergency. "is is something that should 
be taken into account when making any 
decisions about pension consolidation.
LOCATE YOUR PENSION FUNDS
If you think you might have lost a pension 
pot from a previous job, you can use the 
government’s Pension Tracing Service at 
www.gov.uk/$nd-pension-contact-details. 
"is enables people to locate money 
previously saved for retirement that is 
unclaimed. So, it is worth checking if you 
could have pension funds that have not 
been claimed. 
Finally, one thing you also need to bear 
in mind is that pension savings are big 
targets for fraudsters. If someone contacts 
you unexpectedly offering to help you 
transfer your pot, it’s likely to be a scam. 
If you’re concerned, contact the Financial 
Conduct Authority (FCA) to check 
they’re legitimate. l
Source data:
[1] https://www.pensionspolicyinstitute.
org.uk/media/2855/201810-bn110-lost-
pensions-"nal.pdf
THERE IS AN ESTIMATED £9.7 BILLION OF UNCLAIMED UK DEFINED 
CONTRIBUTION PENSION FUNDS[1].
22      |      GUIDE TO RETIREMENT MATTERSOne of the biggest $nancial 
challenges people face is saving 
enough money for retirement. 
"ere are a number of factors that can make 
this di#cult, such as low income, high 
living costs and unexpected expenses.
"e days of working for a single employer 
for your entire career and retiring with a 
comfortable pension are largely gone. "e 
responsibility for accumulating a retirement 
nest egg now rests with individuals as 
opposed to their employers.
START SAVING FOR 
RETIREMENT AS EARLY 
AS POSSIBLE
"ere are many factors that can make 
saving for retirement challenging. For some 
people, it may be di#cult to set aside money 
each month. Others may have unexpected 
expenses that eat into their savings. And still 
others may simply not have enough income 
to save as much as they would like.
No matter what your situation is, it's 
important to start saving for retirement as 
early as possible. "e sooner you start, the 
more time you'll have to let your money 
grow. Even if you can only save a little bit 
each month, it will add up over time.
NOT FINANCIALLY STABLE 
ENOUGH TO CONTRIBUTE
Research into the attitudes of the over-50s 
towards their pension has uncovered that 
nearly a half (49%) regret not saving into 
their pension earlier, and almost two-thirds 
(64%) wish they had contributed more into 
their retirement savings at an earlier stage[1].
Just over a quarter (26%) stated that they 
only started paying into their pension a(er 
they turned 30 years old, primarily because 
they did not feel $nancially stable enough to 
contribute any sooner (51%). 
Many, understandably, prioritised 
raising children (42%) and paying o! 
their mortgages (40%) before putting any 
surplus cash into their pension. However, 
a third put leisure/holidays (32%), clothing 
(21%) and their pets (10%) before their 
retirement income.  
‘MODERATE’ STANDARD OF 
LIVING IN RETIREMENT
Almost four in ten (39%) people over 
the age of 50  believe that an income of 
between £10,000 and £20,000 per annum 
in retirement will be enough to live 
‘comfortably’. 
"is is despite $gures announced stating 
that £20,800 per annum will only provide 
an individual with a ‘moderate’ standard of 
living in retirement. To enjoy a ‘comfortable’ 
standard of living, the amount would need 
to increase to £33,600 per year.
Just under a quarter (24%) of those 
aged over 50 believe that a personal 
contribution of between 0% to 5% of their 
salary is an ‘appropriate and achievable’ 
level to attain a savings pot big enough to 
support them in retirement.
TAKING PROFESSIONAL 
FINANCIAL ADVICE IS KEY
When asked about $nancial advice, 
worryingly, more than 70% of over-50s say 
they have never sought professional $nancial 
A C C U M U L A T I N G 
A  N E S T  E G G
Why saving enough for retirement is challenging for many people
23      |      GUIDE TO RETIREMENT MATTERSadvice regarding their pension. Almost a 
third (30%) say they feel they know what 
they are doing and don’t need $nancial 
support, whilst 10% say they rely on their 
family and friends for support and advice. 
However, a(er hearing that they could add 
as much as £47,000 to their pension[2] (over 
a decade) by taking professional $nancial 
advice, half of them say they would.
Pensions are more important to more of 
us than ever before. Automatic enrolment 
has brought pension savings to millions, but 
this was only introduced in 2012 and for 
many, especially those over the age of 50, it 
is perhaps too little, too late.
TAKE STOCK OF YOUR 
FINANCIAL SITUATION EARLY
Hindsight is a wonderful thing and life in 
your 20s and 30s can o(en take over, with 
children to raise, debts to pay and holidays 
to be had. However, it’s important to take 
stock of your $nancial situation early. You 
may think you have enough spare cash, 
or that you have years until you retire, but 
most people over the age of $(y (64%) 
wished that they had paid more into their 
pension pot, earlier. 
It’s also important that people are realistic 
about how much they might need to live on 
in retirement. With more people continuing 
to pay rent or mortgages a(er they $nish 
working[3], it is unlikely that an income of 
between £10,000 and £20,000 per year will be 
su#cient to have a ‘comfortable’ lifestyle. l 
Source data:
1,034 UK adults over the age of 50 (retired 
and non-retired) interviewed between 
31/01/2022 and 07/02/2022
[1] https://www.retirementlivingstandards.
org.uk/news/retirement-living-standards-
updated-to-re$ect
[2] https://ilcuk.org.uk/"nancial-advice-
provides-47k-wealth-upli%-in-decade/
[3] https://www.bbc.co.uk/news/
business-42193251
NEARLY A HALF (49%) OF PEOPLE REGRET NOT SAVING INTO THEIR 
PENSION EARLIER[1].
24      |      GUIDE TO RETIREMENT MATTERSAs we live longer and fewer of us 
have the security of a $nal salary 
pension, it's more important than 
ever to think about our retirement income.
"ere are a number of di!erent ways 
to save for retirement, but pensions still 
remain one of the most popular and 
e!ective options.
STILL WORKING
Saving money for retirement is important 
because you’ll need a nest egg when 
you’re no longer working. "e best way 
to guarantee an income when you’re in 
your golden years is to save and invest as 
much as you can now while you are still 
working.
For the majority of people, pensions 
represent our biggest single source of 
private wealth and a record number are 
saving more money in occupational 
de$ned contribution pensions. In short, 
pensions are more important to more of 
us than ever before. 
PENSION LANDSCAPE 
However, despite these record highs, 
pensions remain a mystery to most. 
Worryingly, new research reveals a 
widespread lack of understanding 
among savers. 
"e annual study of the pension 
landscape from "e Pensions 
Regulator reports record membership 
of occupational de$ned contribution 
pensions, at 23.4 million[1]. "is is up from 
21.7 million last year.
BIGGEST DRIVER 
"is adds to other recent data highlighting 
the importance of pensions for millions. 
In early January, data from the O#ce 
for National Statistics[2] reported that 
individuals in the UK hold a record £15.2 
trillion of private wealth, and pensions 
represent the largest proportion of this 
$gure at £6.4 trillion. "is exceeds £5.5 
trillion in property and £3.3 trillion in other 
assets, including around £2 trillion in cash. 
"e need to close the gap between 
pension participation and understanding 
is now critical. Overall, auto-enrolment 
has been the biggest driver of participation 
into pension saving over the last decade. 
When it was introduced in 2012, only four 
in ten (39%) private sector workers were 
actively saving for their retirement. "is 
$gure is now more than 70%. 
CONFLICTING RELATIONSHIP 
However, it is risky to assume that this 
participation rate has driven clearer 
understanding. Despite a signi$cant 
increase in participation rates, the 
proportion of adults who agree they 
‘understand enough about pensions’[3] has 
only increased by one percent point in the 
last ten years (from 43% to 44%).  
Other research[4] has found a 
con)icting relationship between value 
and understanding of various elements of 
‘wealth’. Seven out of ten (69%) Britons can 
con$dently estimate the current value of 
G O L D E N  Y E A R S
Pensions represent our biggest single source of 
private wealth
25      |      GUIDE TO RETIREMENT MATTERStheir cash savings and two in $ve of them 
(41%) are very con$dent. "is ‘con$dent’ 
$gure rises to three-quarters (75%) of those 
aged 55+. Cash savings represent around 
12% of total private wealth in the UK.
Four reasons why pensions are so 
important:
1. Pensions provide a guaranteed income 
in retirement.
2. Pensions o!er tax relief on your 
contributions.
3. Pensions can be used to supplement 
your other retirement income sources.
4. Pensions can give you peace of 
mind knowing that you're prepared for 
retirement $nancially.
‘VERY UNCONFIDENT’ 
More than half (53%) of those surveyed 
could also estimate the value of their 
property quite accurately. "is $gure rises 
to 61% of those who are retired. Property 
represents around 36% of total private 
wealth in the UK.
However, despite pensions potentially 
being their biggest combined asset, only 
39% of people could con$dently estimate 
the value of their pension pot. One in ten 
people surveyed were ‘very uncon$dent’ 
about estimating the current value of their 
pension savings. Pensions represent about 
42% of total private wealth in the UK.
PENSION PARTICIPATION 
"e need to close the gap between pension 
participation and understanding is 
now critical. Over the next century it is 
estimated that the pensioner population 
in the UK will increase from 12 million to 
20 million, meaning that more than one in 
four people will be pensioners.
Automatic enrolment has brought 
pension savings to millions. And 
the pension freedoms have given us 
unprecedented choice in how we can use 
that money when we reach age 55. But we 
risk sleepwalking into our retirement if 
we don’t understand how much we have 
in our pension pots, what those savings 
might look like as retirement income and 
how long we need that money to last. l
Source data:
[1] DC trust: scheme return data 
2021 to 2022 | !e Pensions Regulator 
(Memberships do not equate with 
individuals. One individual can have 
multiple memberships. !e "gure of 23.4 
million excludes ‘micro’ occupation DC 
schemes with fewer than 12 members).
[2] O#ce for National Statistics
[3] Survey by Unbiased and Opinium of 
2,000 non-retired UK adults in June – July 
2020
[4] Aviva Research was conducted 
between 5–7 January 2022 by Censuswide. 
Surveyed 2,000 UK respondents (national 
representative sample). 
IN 2012, ONLY FOUR 
IN TEN (39%) PRIVATE 
SECTOR WORKERS WERE 
ACTIVELY SAVING FOR 
THEIR RETIREMENT. THIS 
FIGURE IS NOW MORE 
THAN 70%.[2]
26      |      GUIDE TO RETIREMENT MATTERSThe signi$cant increase in property 
prices in recent years has likely 
shi(ed many people’s expectations 
about the role property wealth will eventually 
play in supporting their retirement. With 
people spending longer in retirement, one of 
the challenges that many need to overcome is 
how to fund it and how to meet the $nancial 
demands they may face in later life, such as 
the cost of long-term care. 
Failure to save enough for old age is 
forcing more people to use their property 
to provide income. Research shows 
so-called ‘Hippies’, or the ‘Home is my 
Pension’ generation, are increasing at a 
signi$cant rate. 22% of people are planning 
ahead for their retirement and expect to 
use the value of their home[1]. "e $ndings 
indicate that just over a third of all people 
who aren’t currently retired (35%) own a 
property but have less than £10,000 saved 
in their pension pot.
HOLDING NO 
PENSIONS SAVINGS 
Worryingly, a further 22% of people hold 
no pensions savings at all. "e signi$cant 
number of small or empty pots, coupled 
with the 24% increase in median house 
price values in England and Wales since 
2016[2], could be driving more people to 
consider using their property wealth to 
fund their retirement.
Property is o(en the largest asset 
someone has when they reach retirement, 
especially if they have lived there for 
quite a while, and will o(en signi$cantly 
outweigh any pensions savings they have. 
ACCESSING PROPERTY WEALTH 
Based on current house prices in England 
and Wales, the average homeowner could 
access over £72,988 in equity release, for 
instance[3]. People who aren’t currently 
retired expect to downsize their property 
(10%), sell their property (9%) or access 
equity via a lifetime mortgage (6%) to help 
fund their later life.
While many people looking ahead to 
retirement are hoping to access property 
wealth, there are a signi$cant number 
of retired homeowners who could also 
bene$t from considering the role their 
property might play in funding their 
lifestyle. 
MAIN SOURCE OF INCOME 
Nearly two-thirds of people over 65 are 
dependent on the State Pension as their 
main source of income and are also 
homeowners. 
"e $ndings show there are a large 
number of people currently in retirement 
who may be on a limited income and 
could bene$t from the likely increases in 
the value of their home. l
Source data:
[1] Opinium survey of 4,000 UK adults 
between 31 October and 3 November 2021
[2] O#ce for National Statistics, House 
price statistics for small areas in England 
and Wales: year ending March 2021, Nov 
2021
[3] Legal & General customers accessed, on 
average, 24.5% of the value of their home 
through equity release, putting the expected 
amount that can be accessed across England 
and Wales at £72,988: O#ce for National 
Statistics, House price statistics for small 
areas in England and Wales: year ending 
March 2021, Nov 2021
‘ H O M E  I S  M Y  P E N S I O N ’ 
G E N E R A T I O N
People using property to support their retirement lifestyle
JUST OVER A THIRD 
OF ALL PEOPLE WHO 
AREN’T CURRENTLY 
RETIRED (35%) OWN A 
PROPERTY BUT HAVE 
LESS THAN £10,000 
SAVED IN THEIR 
PENSION POT.[1]
27      |      GUIDE TO RETIREMENT MATTERSPeople planning for retirement should 
think hard about what they want to 
do when they eventually stop work. It 
is helpful to have a good idea of the lifestyle 
you want, how much it will cost and how you 
are going to pay for it. 
With so much going on in your life – 
from family and work to pursuing your 
passions – retirement planning may not 
have been your priority. But now you want 
to make sure your pension and overall 
$nancial situation will allow you to keep 
up your current lifestyle and enjoy your 
golden years. "e more enthusiastic you 
are about retiring, the more likely you are 
to develop a robust retirement plan.
DIY APPROACH TO RETIREMENT
Obtaining professional $nancial advice is 
key to ensuring you achieve the retirement 
you want. But 8 million people are 
planning a DIY approach to retirement 
and many don’t know how to avoid 
running out of money, avoid a big tax bill 
or leave an inheritance, new research has 
highlighted[1].
Millions of people don’t understand 
their retirement options when they stop 
work. More than a third (35%) of pension 
holders admit they know nothing about 
the product options at retirement and the 
pros and cons of each option.
PRODUCT OPTIONS AT 
RETIREMENT
And more than one in $ve (22%) of those 
planning to retire in the next $ve years 
know nothing about the product options 
at retirement. And they don’t understand 
some of the big risks in retirement. 
Worryingly, 35% of pension holders know 
nothing about how stock market falls can 
a!ect retirement savings.
Of those surveyed, 34% commented 
they don’t know how to ensure they will 
not run out of money in retirement. Half 
of people with a pension over £100,000 
didn’t know a good amount about how to 
take money from their pension in a tax-
e#cient way.
TAKING PROFESSIONAL 
FINANCIAL ADVICE
Only 34% of married people understand 
how to ensure their spouse will be le( 
with enough pension if they die. Although 
people are unclear about their options, 
worryingly many are not considering 
taking professional $nancial advice.
Only 39% of pension holders are 
planning on taking $nancial advice 
when they retire, with 31% planning to 
DIY their retirement. Only half (52%) 
of mass a*uent people – those with 
assets of between £100,000 and £500,000 
excluding property – are planning to take 
professional $nancial advice.
SERIES OF BIG DECISIONS 
TO MAKE 
"e top occasions where mass a*uent 
consumers feel that people should seek 
professional $nancial advice are: choosing 
to invest a large lump sum (43%), 
Inheritance Tax planning (44%) and 
deciding how to access a pension (40%).
People have a series of big decisions to 
make as they approach the end of their 
working life and each one can make a huge 
di!erence to their retirement. For example, 
should you drawdown your pension in one 
go or over a period of time? Should you take 
your 25% tax-free cash or leave the money in 
your pension fund to grow? Should you buy 
an annuity to guarantee an income for the 
rest of your life or go for drawdown?+"ese 
are questions your professional $nancial 
adviser will help answer.
MAKING BIG FINANCIAL 
DECISIONS
Obtaining advice compensates for the 
emotional biases people have when they 
make big $nancial decisions.+A DIY 
approach to managing large pension funds 
at retirement is fraught with risk. 
People can easily buy the wrong 
products, incur unnecessary tax bills or 
simply exhaust their retirement funds too 
quickly, whereas an adviser will provide an 
impartial, cool-headed approach to their 
client’s $nances and o!er solutions that the 
client will not even have considered.+l
Source data:
[1] !e LV= Wealth and Wellbeing Monitor is 
a quarterly survey of 4,000+ consumers which 
examines their attitudes to spending, saving 
and retirement. !e Monitor also surveys the 
attitudes of mass a&uent consumers, those 
with assets of between £100,000 and £500,000 
excluding property, who are a key target 
market for "nancial advisers. LV= surveyed 
4,000+ nationally representative UK adults 
via an online omnibus conducted by Opinium 
in June' 2021.'
D E V E L O P I N G  A  R O B U S T 
R E T I R E M E N T  P L A N
How much it will cost and how you are going to pay for it?
28      |      GUIDE TO RETIREMENT MATTERSIf you’ve spent a lifetime saving for 
retirement, you’d probably like any 
remaining money to go to a loved 
one a(er your death. But whether pension 
bene$ts are payable to a bene$ciary, and how 
they’ll receive them, is dependent on the type 
of pension you’ve chosen and how you’ve 
accessed it in your retirement. 
"anks to changes in the way that 
pensions are taxed, more of your fund can 
survive your death and provide an income 
or nest egg for your loved ones to enjoy, 
long a(er you are gone. Since April 2015 it 
has been easier to safeguard your pension 
for your heirs, but it’s important to make 
sure you’re keeping up with the changes. 
"e way that you decide to take your 
pension will a!ect what you can do with it 
when you pass away. And while it’s not always 
easy to talk about, the way you eventually 
pass on your pension has the biggest impact 
on other people, so it could help if you talk to 
your spouse, partner, children or other people 
close to you when you’re deciding how you 
take your pension savings.
PENSION DEATH BENEFITS
If you have not yet accessed your pension, 
or you have made withdrawals from your 
pension but le( some money invested, it 
can usually be passed to a bene$ciary a(er 
your death. "e speci$cs, for example, in 
what form they will receive these death 
bene$ts and whether they will pay tax, will 
depend on your individual circumstances 
(such as your age) and the scheme rules. 
You should always obtain professional 
$nancial advice to assess your speci$c 
situation. But if your pension scheme 
allows you to choose a bene$ciary, ensure 
you have named the person you intend to 
leave your money to.  
ANNUITY DEATH BENEFITS
If you have used your pension savings 
already to purchase an annuity, this can 
only be passed on to a bene$ciary in certain 
cases, which must be established when the 
annuity is purchased. A typical lifetime 
annuity only provides a guaranteed income 
for the lifetime of the annuity holder, 
regardless of how long this is.
For your annuity income to go to a loved 
one a(er your death, you must choose 
either an annuity with a guarantee period 
(which provides an income for a set period, 
whether you are still living or not) or a joint 
life annuity (which provides an income for 
life for whichever partner lives longest). 
STATE PENSION INHERITANCE
In certain circumstances, your partner can 
continue to receive your State Pension a(er 
your death. For example, if you’re a man 
born before 1951 or a woman born before 
1953, and you’re receiving the Additional 
State Pension, this can be inherited by 
your partner (husband, wife or registered 
civil partner) a(er your death if they have 
reached the State Pension age. l
S A F E G U A R D I N G 
Y O U R  P E N S I O N
Providing an income for your loved ones to enjoy, long a%er you are gone
IF YOU HAVE NOT 
YET ACCESSED YOUR 
PENSION, OR YOU HAVE 
MADE WITHDRAWALS 
FROM YOUR PENSION 
BUT LEFT SOME MONEY 
INVESTED, IT CAN 
USUALLY BE PASSED TO 
A BENEFICIARY AFTER 
YOUR DEATH.
29      |      GUIDE TO RETIREMENT MATTERSOne of the most di#cult decisions 
you'll ever have to make is when 
to retire. It's a personal choice that 
depends on many factors, both $nancial and 
non-$nancial. "ere's no single right answer, 
but there are some key things to consider 
that can help you decide if retirement is the 
right choice for you.
"ere is no one-size-$ts-all answer to 
the question of when to retire. Ultimately, 
the decision of when to stop working is a 
personal one, and will depend on a variety 
of factors speci$c to your individual 
situation. However, there are some general 
guidelines that can help you determine 
whether you’re ready to retire. 
"e best time to retire will depend on a 
variety of factors, including your health, 
your $nancial situation and your personal 
preferences. If you’re in good health and 
you have a solid $nancial foundation, you 
may be able to enjoy a long and active 
retirement. On the other hand, if your 
health is declining or you’re struggling to 
make ends meet, retiring sooner may be 
the best option.
SPENDING POWER EACH YEAR
It's not easy to know when the time is right 
to retire. "ere are a number of factors to 
consider, and it's di!erent for everyone. 
Ultimately, the decision of when to retire 
is a personal one. It’s important to do some 
soul-searching and research before making 
a $nal decision. Once you’ve decided 
when the right time for you is, be sure to 
plan carefully to make the most of your 
retirement years.
Some people may now need to think 
about the impact that in)ation could 
have on their retirement income, and 
to consider whether they can a!ord to 
retire yet. Rising in)ation can wipe years 
of retirement income o! pension pots 
as savers must increase the amount they 
withdraw to maintain the same spending 
power each year.
IMPACT ON RETIREMENT PLANS
In)ation can have a signi$cant impact on 
your retirement plans. If in)ation is high, 
the purchasing power of your savings 
will decrease over time. "is means that 
you will need to save more money in 
order to maintain your standard of living 
in retirement.
To o!set the impact of in)ation, you 
may need to adjust your retirement 
plans. For example, you may need to save 
more money so that you can maintain 
your standard of living in retirement. 
Additionally, you may need to invest 
in assets that are less vulnerable to the 
e!ects of in)ation. Bonds are one type 
of investment that can help protect your 
portfolio from in)ation risk. In general, 
I S  R E T I R E M E N T  T H E 
R I G H T  C H O I C E  F O R  Y O U ?
General guidelines that can help you determine whether you’re ready to retire
30      |      GUIDE TO RETIREMENT MATTERSthey can o!er relative stability, but you 
need to take your age and risk tolerance 
into consideration.
POTENTIAL EFFECTS OF 
INFLATION
While in)ation can have a signi$cant 
impact on your retirement plans, there are 
steps you can take to o!set its e!ects. By 
saving more money and investing in assets 
that are less vulnerable to in)ation, you 
can help ensure that your retirement plans 
remain on track. Additionally, by being 
aware of the potential e!ects of in)ation, 
you can make adjustments to your plans as 
needed to account for its impact.
As you get closer to retirement, it’s 
important to start thinking about how 
in)ation could impact your plans. While 
in)ation can be a good thing if it leads 
to higher wages and increased economic 
activity, it can also be a problem if prices 
start rising faster than your income, as we’ve 
seen this year with in)ation reaching a new 
40-year high amid a cost of living squeeze.
!ere are some general principles that 
can help guide your thinking on this 
important topic: 
"e $rst principle is that it’s never too 
early to start planning for retirement. "e 
sooner you start saving and investing for 
retirement, the more time your money 
has to grow. "is is due to the power of 
compounding – which essentially means 
that your money earns interest on itself 
over time.
"e second principle is that retirement 
planning is not a one-time event. Your 
retirement timeline will likely change as 
life circumstances change. For example, 
you may need to adjust your timeline 
if you have children or other family 
members who depend on you $nancially.
"e third principle is that retirement 
is not an all-or-nothing proposition. You 
don’t have to retire completely in order to 
enjoy a comfortable lifestyle in retirement. 
Many people choose to work part-time or 
pursue other interests during retirement 
instead of (or in addition to) simply sitting 
around and doing nothing.
TIME TO UTILISE CASH 
FLOW MODELLING?
Planning for retirement is a complex task, 
made even more di#cult by the fact that 
most of us don’t have a crystal ball to 
predict the future. "is is where retirement 
cash )ow modelling can be incredibly 
useful. "is can help you estimate your 
future income and expenses in retirement 
and give you a better idea of how much 
money you’ll need to have saved in order 
to maintain your current lifestyle.
By creating a model of your expected 
income and expenses, you can better plan 
for your retirement and make sure that you 
have enough money to cover your costs. 
"is type of modelling can also help you 
to identify any potential shortfall in your 
retirement savings, so that you can make 
adjustments to your plans accordingly. 
If you are nearing retirement or are 
already retired, cash )ow modelling can 
help you: understand how much income 
you will need in retirement; work out 
how long your retirement savings will 
last; determine the best way to use your 
retirement savings to generate an income 
in retirement; and $nd out how di!erent 
life events (such as taking a career break or 
downsizing your home) could impact your 
retirement cash )ow. 
WOULD AN ANNUITY BE 
BENEFICIAL?
Annuities can be a good way to combat 
rising in)ation. Increasing annuities 
guarantee a stream of income that can 
o!er protection against the cost of living. 
However, it is important to choose an 
annuity that has a high enough rate of 
return to outpace in)ation, as otherwise 
you may end up losing purchasing power 
over time. 
Some annuities o!er built-in protection 
against in)ation. For example, some 
annuities o!er cost-of-living adjustments 
that increase payments to keep pace with 
in)ation. "is can help retirees maintain 
their purchasing power and keep up with 
the rising costs of living. While annuities 
are not the only solution for combating 
rising in)ation, they can be a helpful tool 
for retirees. 
Ultimately, whether or not an annuity 
is a good way to combat in)ation depends 
on your individual circumstances. If 
you are concerned about preserving 
your purchasing power in retirement, an 
annuity can be a helpful tool. However, 
you should obtain professional $nancial 
advice to weigh the costs and risks 
associated with an annuity before making 
a decision.
ARE YOU SITTING ON TOO 
MUCH CASH?
If you’re sitting on too much cash right 
now, with in)ation on the rise, that cash 
could be losing value, so you may want to 
rethink your strategy. In)ation is a natural 
occurrence that happens when the prices 
of goods and services start to increase. "is 
can erode the purchasing power of your 
money, which means that you’ll need more 
money to buy the same items.
"ere are a few ways to combat in)ation 
and ensure that your money keeps its 
value. One option is to invest in assets that 
may appreciate in value, such as stocks 
and shares or property. No matter what 
strategy you choose, it’s important to be 
aware of the impact that in)ation can have 
on your $nances. By being proactive, you 
can ensure that your money keeps its value 
over time.
WHAT IS YOUR ATTITUDE 
TO RISK?
When pension planning, your attitude 
to risk will play a big role in how your 
portfolio is structured. If you’re willing to 
take on more risk, you may be rewarded 
with higher returns. But if you’re not 
comfortable with risk, you may want to 
focus on preserving your capital.
Once you have a better idea of your risk 
tolerance, you can start to allocate your 
assets accordingly. For example, if you’re 
okay with some volatility, you may want to 
put some of your money into stocks and 
shares. But if you’re not comfortable with 
any volatility, you may want to keep your 
money in cash and bonds.
No matter how much risk you’re willing 
to take on, it’s important to remember 
that all investments come with some risk. 
"ere’s no such thing as a completely 
risk-free investment. But by understanding 
your risk tolerance, you can make sure that 
your portfolio is structured in a way that 
meets your needs. l
31      |      GUIDE TO RETIREMENT MATTERSYour pension is one of your most 
valuable assets, and for many it 
o!ers $nancial security throughout 
retirement and the rest of their lives. But, like 
anything valuable, your pension can become 
the target for illegal activities, scams or 
inappropriate and high-risk investments.
Fraudsters promise high returns and low 
risk, but in reality, pension savers who are 
scammed can be le( with nothing. When 
savers realise they’ve been scammed, 
it can be devastating – many lose their 
life savings. Once the money is gone, it’s 
almost impossible to get it back.
HOW PENSION SCAMS WORK
Anyone can be the victim of a pension 
scam, no matter how savvy they think they 
are. It’s important that everyone can spot 
the warning signs.
Scammers try to persuade pension 
savers to transfer their entire pension 
savings, or to release funds from it, by 
making attractive-sounding promises they 
have no intention of keeping.
!e pension money is o$en invested in 
unusual, high-risk investments like:
n Overseas property and hotels
n Renewable energy bonds
n Forestry
n Parking
n Storage units
Or it can be simply stolen outright.
WARNING SIGNS OF A 
PENSION SCAM
Scammers o(en cold call people via phone, 
email or text – this is illegal, and a likely 
sign of a scam. "ey o(en advertise online 
and can have websites that look o#cial or 
government-backed.
Other common signs of pension scams:
n Being approached out of the blue: 
 
by text, phone call, email or at your  
 
front door
n Phrases used like ‘free pension review’,  
 
‘pension liberation’, ‘loan’, ‘legal  
 
 
loopholes’, ‘savings advance’, ‘one-  
 
o! investment’, ‘cashback’, ‘government  
 
initiatives’
n Recommendations of transferring your
 money into a single overseas
 
investment, with returns of 8% 
 
or higher
n Guarantees they can get better returns  
 
on pension savings
n Help to release cash from a pension  
 
before the age of 55, with no mention  
 
of the HM Revenue & Customs  
 
 
(HMRC) tax bill that can arise
n High-pressure sales tactics – time-  
 
limited o!ers to get the best deal; using  
 
couriers to send documents, who wait  
 
until they’re signed
n Unusual high-risk investments, which  
 
tend to be overseas, unregulated, with  
 
no consumer protections
n Complicated investment structures
n Long-term pension investments –   
 
which o(en mean people who transfer  
 
in do not realise something is wrong  
 
for a number of years
n Claims that they are from a legitimate  
 
organisation like the Pension Service,  
 
Pension Wise
n Visits from a courier or personal  
 
 
representative to pressure you to sign  
 
paperwork and speed up your transfer
n "ere may be an authentic-looking  
 
website, but these can be cloned from  
 
legitimate organisations
n "ere will be little or nothing in the  
 
way of contact names, addresses or  
 
phone numbers
SCAMS CAN TAKE MANY FORMS
Many scammers persuade savers 
to transfer their money into single 
member occupational schemes, or other 
occupational pension schemes.
It’s good to remember that pension 
scams can take many forms and usually 
appear to most to be a legitimate 
investment opportunity.
WHAT TO DO IF YOU THINK 
YOU’VE BEEN OR ARE 
BEING SCAMMED
If you think you might have already been 
targeted and you’ve agreed to transfer 
your pension, you should:
1. Contact your pension provider 
immediately – they may be able to stop the 
transfer if it has not already gone through.
2. Contact Action Fraud on 0300 123 2040 
and report the scam.
3. Action Fraud website contact form: 
https://www.actionfraud.police.uk/
contact-us-form l
B E A T  T H E  P E N S I O N 
S C A M M E R S
Once the money is gone, it’s almost impossible to get it back
32      |      GUIDE TO RETIREMENT MATTERSM A K E  R E T I R E M E N T 
T H E  B E S T  Y E A R S  O F 
Y O U R  L I F E
Take control of your "nances 
– 10 tips to enjoy the retirement you want
33      |      GUIDE TO RETIREMENT MATTERS1. Review your spending habits and 
consider if you have the scope to save a 
little more each month.
2. Look up your annual bene$t statements 
– you may have saved with more than one 
employer’s pension scheme.++
3. "ink about what $nancial milestones 
you’d need to reach in order to increase 
your pension contributions and review 
your investment choices.
4. Find out more about your current 
pension plan. If you pay in more, does 
your employer match your contributions?
5. Track down old pension schemes using 
the government’s $nder service https://
www.gov.uk/$nd-pension-contact-details. 
Or request contact details from the 
government’s Pension Tracing Service on 
0800 731 0193 or by post.
6. Check that your Expression of Wish 
form is up to date. "is is a request 
setting out whom you would like to 
receive any death bene$ts payable on 
your death.
7. Check your State Pension entitlement. 
To receive the full State Pension when 
you reach State Pension age you must 
have paid or been credited with 35 
qualifying years of National Insurance 
contributions. Visit the Government 
Pension Service https://www.gov.uk/
contact-pension-service for information 
about your State Pension.
8. Add up the savings and investments 
that you could use for your retirement. A 
pension is a very tax-e#cient way to save 
for your retirement but you might also 
have other savings or investments that 
you could use to increase your income 
when you retire.
9. If you’re getting close to retirement and 
the amount you’re likely to retire on is less 
than you’d hoped, consider ways to boost 
your pension.
10. Decide when to start taking your 
pension. You need to set a target date when 
you want to start drawing an income from 
your pension – and remember, you don’t 
have to stop working to take your pension 
but you must be aged at least 55 (you 
might be able to do this earlier if you’re in 
very poor health). l
The content of this guide is for your general information and use only, and is not intended to address your particular 
requirements. The content should not be relied upon in its entirety and shall not be deemed to be, or constitute, advice. 
Although endeavours have been made to provide accurate and timely information, there can be no guarantee that such 
information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or 
company should act upon such information without receiving appropriate professional advice after a thorough examination 
of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of 
the content. Thresholds, percentage rates and tax legislation may change in subsequent Finance Acts. Levels and bases of, 
and reliefs from, taxation are subject to change and their value depends on the individual circumstances of the investor. The 
value of your investments can go down as well as up and you may get back less than you invested. Content based on our 
understanding of the current 2022/23 tax laws and HM Revenue & Custom’s practice.
READY TO START 
TALKING TO US TODAY 
ABOUT YOUR FUTURE 
RETIREMENT PLANS?
We can help you make sure it’s a resilient one. We understand our 
clients' goals, aspirations and dreams – we’d love to understand yours too. 
It’s time to start talking.
To find out how we can help you – please contact us.
Goldmine Media, Basepoint Innovation Centre, 110 Butterfield, Great Marlings, Luton, 
Bedfordshire, LU2 8DL. Articles are copyright protected by Goldmine Media Limited 2022. 
Unauthorised duplication or distribution is strictly forbidden.