A Practical Guide to Navigating Retirement Planning

Planning for retirement doesn't have to be overwhelming. This guide aims to simplify the process by addressing the most common retirement savings and pension questions. 
27th February 2024
Written by Jarvis

Retirement Savings: How Much is Enough?

Determining your retirement savings involves a balance of two main elements: affordability & your ideal retirement lifestyle. 

 Start by evaluating what you can realistically save. A direct debit can simplify this, helping you stay consistent. And, as your income increases, consider increasing your savings along with it.

Your Ideal Retirement
 Picture your retirement lifestyle and base your savings goals on your current financial situation. Don't forget to factor in changes like reduced expenses or the end of mortgage payments.

Pension Contributions: Tailored to Your Employment Status

Your pension contributions will vary depending on whether you're employed or self-employed.

Employed Individuals 
For those in employment, auto-enrolment in workplace pension schemes is standard, with contributions from both you and your employer.

Self-Employed Individuals
If you're self-employed, the responsibility for pension planning falls entirely on you. Personal pensions offer tax efficiency with a substantial annual allowance and tax relief opportunities.

Pension Consolidation: Streamlining Your Finances

Consolidating multiple pensions can simplify your retirement planning, potentially reducing fees and administrative tasks. However, it's not a one-size-fits-all solution – consider speaking with a financial adviser to see if it's right for you.

Pension Withdrawals: Accessing Your Funds

You can start accessing your pension at 55 (57 from 2028). Up to 25% can be taken tax-free, with various options for the rest. It's important to understand the tax implications, so seeking advice can be beneficial.

Understanding Pension Management Charges

Being aware of the different fees associated with pensions is important:

  • Annual Management Charge: This fee covers the administration of your pension scheme.
  • Ongoing Charges Fund: Reflects the running costs of your investment funds.
  • Trading/Dealing Costs: These are incurred when buying or selling investments within your plan.
  • Pension Transfer Charges: May be applicable in cases of pension consolidation.

Start Early to Get Ahead

Effective pension planning hinges on understanding your savings needs, how to contribute, and exploring your withdrawal and consolidation options. The sooner you start, the more prepared you'll be for a comfortable retirement.

Get more info on Jarvis here.

Risk Warning:
The value of your investments may fall as well as rise. You may get back less than you originally invested.

Transfer Warning:
We do not provide financial advice. Consolidating pensions may not be right for everyone. If you are unsure about transferring your pension, you should seek help from a qualified financial adviser. Please be aware that pensions with defined or safeguarded benefits will not be eligible for transfer to your Jarvis SIPP.

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With Jarvis, you can design your pension plan, and work out how much you need to save each month based on the retirement you want to have. So you can be confident about your financial future

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