Planning for your own retirement is a tricky topic. There are many variables to consider, and each individual has a specific set of circumstances and goals to achieve.

But there are a few key areas of planning for your golden years that can help you to have clear in your mind what needs to be done, and how you can aim to achieve your ambitions.

Here are four key areas to consider.

1. Time horizon

Thinking about when you would like to retire is perhaps the most fundamental consideration when planning for retirement. Essentially, every decision you make depends on when you actually plan to stop working.

There are a lot of variables to it as well. Retirement is not the straightforward end day and handshake it once was. Evermore frequently people decide to go on what is called a ‘glide path’ to retirement, reducing hours or days in the office until eventually stopping completely.

You’ll need to consider your age now, and how old you’ll want to be when you retire. The younger you are and the further away your retirement date, the more time you’ll have to save and invest to grow that wealth.

If you’re happy working until an older age other considerations such as State Pension entitlement become relevant, as you’ll likely have access to it from age 67 (or later depending on your current age).

2. Risk appetite

Once you have set your goals for retirement age – or glidepath to retirement – you’ll want to consider how you’ll get there. There’s a good chance you’re already building wealth through a variety of resources such as property, pensions and ISAs.

Depending on your time horizon you will need to accept certain levels of risk within your portfolio in order to reach those goals.

While being able to save set amounts is key, the compounding effect of growth and regular contributions will have the biggest impact on how your retirement funds grow. Ultimately it is ok to be more conservative with your tolerance for risk, but that may have an impact on the point at which your wealth reaches a size at which you feel comfortable enough to retire.

3. Spending needs

You also need to estimate how much you’re likely to spend in retirement. Again this is very subjective, as each individual has a different idea of what their golden years will look like. For some it looks like world cruises, nice cars or even moving to somewhere sunnier. For others it is staying at home, helping with the grandkids and pottering in the garden.

Either choice – or anything in between – is totally fine. But both carry very different kinds of cost implications.

On top of that, age and longevity is something important to consider. Although not a hard and fast rule, retirement spending is often ‘U’ shaped, if plotted on a graph. At the beginning of retirement people tend to enjoy some of the good things, going on trips or spending some pension cash on home improvements.

Then as time goes on many settle into a rhythm that is generally lower cost (the bottom of the U). Finally, as people enter advanced ages costs such as help around the home (gardeners, cleaners etc) and even care costs, start to mount up.

All this is to say it is hard to establish what an ‘average’ income should look like for any individual. With these different costs in mind it is important then to think realistically about what you’ll need, and how long you’ll be able to sustain it for.

Our financial advisers can help you create a financial life plan ’, which can be a great way to properly visualise how this might work.

4. Estate and tax planning

Finally, a really important consideration is how all of this is structured. As mentioned before we’re given access to a variety of wealth building tools such as pensions, ISAs or property.

In the first instance it is essential to plan how much of your money goes where to make it as tax efficient as possible. Then you’ll need to think about the tax implications of this wealth once you’re gone – and how to make that process as tax efficient and simple for your loved ones as possible.

With the inherent complexity of these issues though, it pays to have the help of a qualified financial adviser to plan for the best outcomes possible.