Whenever it is you retire and whatever your retirement looks like, one of the biggest differences, along with much more choice over how you spend your time, is where your money comes from. Until now, pensions and investments were about saving but in retirement they’re likely to become your pay packet, providing the money to live your life.
What can you do with your pension?
What can you do with your pension when you retire? In this short video we explain the different options – including buying something called an annuity for a secure income, taking income as and when you want to through income drawdown, making lump sum withdrawals and keeping your pension invested in retirement.
Your pension options at retirement
For most people, pensions form the bulk of their money in retirement so one of the biggest challenges you’ll face is deciding how best to take your pension savings. Until recently, the options were limited but, following an overhaul of pensions in April 2015, the good news is that you now have freedom over how and when to take your money.
Need a home for your pension?
Our pension, the Saga SIPP, has been built to help you get the best from your pension when you retire. It gives you freedom to make lump sum withdrawals, take a regular income or buy an annuity when you want to. It’s also an excellent choice if you want to keep your pension invested. With the Saga SIPP, we can choose and manage your investments for you or you can do it yourself.
Your other investments at retirement
If you have investments other than pensions, you might find they take on a different role during retirement, for example you might rely on them for an income. Because of this, the run up to retirement is an excellent time to take stock of what you’ve got and make sure your investments suit your new lifestyle.
While investments can and do go up and down in value, there’s no getting away from the fact that some investments perform a lot better than others. Keeping an eye on performance is an important part of investing and so too is switching investments if you don’t like what you see.
The amount you pay in charges and fees can vary between providers and can also depend on the types of investments you choose. Going for the cheapest isn’t necessarily the best – you know the saying, ‘you get what you pay for’ – but at the same time, paying too much will mean you’ll be left with less money to invest. Making full use of the tax perks that come with accounts such as ISAs and pensions is another powerful way to make the most of your money.
It’s common in retirement to use investments as a way to create an income to help you live your life. As some investments are better at producing an income than others, people often take another look at their investments when they retire to check that they are still right for them at this stage of life. Of course, there’s no right or wrong answer when it comes to investing so you need to do what’s right for you.
How about financial planning?
Whether it’s a doctor, a dentist or a solicitor, many find it helpful and reassuring to talk to a professional. Why should it be any different when it comes to your finances? The role of a financial planner is to help you work out what your financial goals are and then put in place a plan to help you achieve them.
Would you benefit from financial planning? We have a big team of financial planners across the UK who can provide all the expert financial advice you need.