Do you have a dream retirement age in mind? Most people do.

Unfortunately, many people believe that, no matter how hard they wish to retire on time, they will be beholden to their employer long past the age they’d like to be putting their feet up.

The situation

According to research from Scottish Widows, more than 10 million UK adults estimate that they will need to continue working until they are no longer physically able to do so. Furthermore, three million people say that they have no choice but to work until the end of their life.

Less than a quarter (24%) of people expect that they will have left working life behind completely by the time they reach 65, with the least optimistic outlook held by younger generations.

51% of people expect to remain employed on at least a part-time basis; and just 18% say that this will be down to preference, rather than necessity.

Your options

Retiring at a reasonable age shouldn’t be impossible, but it will mean planning ahead and might mean making some changes to your current financial habits.

1. Know your position

Look at what you are currently doing to prepare for retirement and use a calculator (such as this one) to work out:

• How much you are likely to have in retirement, without making any changes
• What age you could retire
• How much you will need (lump sums and income) to retire on your own terms
• What the shortfall is

You can then use this information to determine what needs to change between now and the age you want to retire, to ensure that you have enough money to support your desired lifestyle.

2. Save more

Putting more money aside now, will give you more income when you choose to access it. It sounds simple enough, doesn’t it? But, according to the research, 23% of 25-54-year olds are concerned that they are not putting enough away for the future. Meanwhile, 39% fear running out of money completely after they give up working.

3. Take advantage of the helping hands offered

If you are paying into a workplace pension, you already have a great foundation for sensible saving habits. However, for those who have joined a pension through the introduction of automatic enrolment, the minimum contributions made by you and your employer are unlikely to be enough to provide an adequate retirement income.

Currently, your employer must contribute the equivalent of 2% of your pensionable earnings (the income you receive between £6,032 and £46,350 each year), whilst a further 3% is taken from your salary before you receive it. Unfortunately, current expert guidelines state that the average worker will need to put a total 12% of their annual earnings to one side, meaning that many people currently contribute less than half of what they will need to live the retirement lifestyle they aspire to.

4. Repay debts

If you can retire without debt, you will be able to do more with your income. Reducing your living costs as you enter retirement will make a big difference to your ongoing budget. With a smaller portion of your retirement income being lost to repaying debts, you will have more available to enjoy the retirement lifestyle you want.

How you achieve this will differ, depending on your circumstances. But it could include moving into a smaller property, cutting back on non-essential spending and even smaller changes, such as shopping around for better deals from utility providers.

5. Talk to a professional

Engaging with a financial adviser or planner will help you to get on the right track to retiring on your terms; your income and age of choosing.

Research has shown that, those who seek the help of advisers and planners can save up to £98 per month extra toward their retirement income, which could give you an additional £3,654 per year to live on when you stop working.

Planning for retirement can be a daunting task. But, by talking to the right person, you can ensure that you are able to stop working, when it suits you, and with the retirement income you want. For more information or to get started, why not get in touch with us?