Everyone likes to think that they'll be able to spend their retirement in comfort, with enough money coming in to live their golden years to the full. However, that dream may not be the reality for a lot of people, with research finding that many pre-retirees are worried that they'll run out of cash.
According to MGM Advantage, 28% of the over 55s wouldn't be comfortable to manage their own pension savings with 69% of those saying that running out of money in retirement was a key concern, and that means a lot would still choose to seek proper financial advice to make sure their money goes further – even though the Budget offers them more flexibility to spend their pension pot however they wish.
"With the welcome increased choice and flexibility comes more complexity," said Aston Goodey of MGM. "People approaching retirement will have to make some crucial decisions about how they can maximise the pension savings they have… This is where receiving financial advice will be key."
The research would suggest that a lot of retirees will make sure they properly budget to avoid running out of money in later life, and many would seek the necessary advice to ensure that. But, in order to stand the best possible chance of having enough income in retirement, it's all about being prepared.
You want your pension pot to be as healthy as possible so it can easily support you throughout your retirement, but unfortunately it would seem that many of us simply aren't making the most of the savings possibilities.
Ideally auto-enrolment should help people be more prepared with a suitable occupational pension, but that may not be sufficient – you'll want to have your own savings in place too, however additional research from TSB has revealed that 63% of those surveyed haven't yet used their ISA allowance for the year, and that's tax-free interest down the drain.
Utilising an ISA can be a great way to grow your nest egg and help fund your retirement, and luckily 43% of those that do save are treating it as a long-term investment. The new ISA limit of £15,000 due to come into force in July can offer an even bigger boost for those with sufficient disposable income, but what about those that have already hit retirement?
Well, maximising your returns with the best savings rates should still be a top priority, but equity release could also be worthy of consideration. Research from Saga has found that 31% of homeowners view their properties as a way to fund care in later life while a quarter see it as a source of retirement income, and with the over-50s having a significant amount of wealth tied up in their home, unlocking it could prove to be a great way to fund a comfortable retirement.
As Andrew Strong of Saga says, "With a professional valuation and a few simple steps, [the over 50s] could unlock the value of their homes and enjoy a much more satisfying retirement." It needn't be that difficult to get the process started and Moneyfacts' equity release service could help you determine if it's the right course of action, and by utilising all the options at your disposal, from ISAs to pensions and equity release, you can make sure you don't run out of money in retirement to truly enjoy your golden years.
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