Time to plan your pension

SPONSORED BY Legal & General

Autumn is certainly a good time to tackle a job you may have been ignoring. Few of us enjoy taking a clear-sighted look at our financial future, but spending a day on retirement planning is essential financial maintenance. We can’t do it for you, but Legal & General has produced a range of resources that can help at any stage, whether you’re starting to learn or wanting to brush up your knowledge.

We do understand just how overwhelming retirement planning can feel. Our research shows that people spend more time choosing a car than designing the last third of their adult life; a bit odd, when you consider that planning your later life is probably the most important piece of financial planning you will ever undertake. We know the coronavirus has increased uncertainty and brought financial worries to many; more than a million of those over 50 are now considering delaying retirement. So it is more important than ever to understand
your options.

By spending just one day on retirement planning, you can make a significant difference to your future. It might be short-term pain, but it’s very much long-term gain, with some juicy rewards to look forward to. So, what’s the best way to start, apart from pouring yourself a big mug of coffee?

Following the old proverb, that the best way to eat an elephant is to take it one bite at a time, the best way to tackle pensions is to break it up into manageable-sized bites. You may already have a lot of the information and knowledge you need, but key to making decisions is understanding. The better you appreciate your choices, the more confident you will be in taking the route that is right for you. Pensions aren’t as complicated as sometimes appears and there are many resources out there, from the simplest online calculator to more formal learning programmes.

We believe there are five elements to consider:

  • understanding how to work out the income you’ll need in retirement;
  • understanding how your pensions and the state pension operate, and how much income they should provide;
  • understanding the different options for providing an income in retirement, and the pros and cons of each option;
  • understanding the options available if your pension income is unlikely to provide sufficient income for you in retirement;
  • understanding what other plans you need to manage your finances later in life.

These five elements are covered in a free online course, produced by The Open University in collaboration with Legal & General. You can find the course, Retirement Planning Made Easy, at open.edu/openlearn/retirement-planning-made-easy.

“By spending just one day on retirement planning, you can make a significant difference to your future”

It should take about three hours to work through the course, although you don’t have to do it all in one go. It  sets out the steps to a financially secure retirement through a mixture of reading, short videos and activities.

But we all learn in different ways and you may prefer listening to a podcast while you go about your daily life. Legal & General has teamed up with Strictly Come Dancing judge Shirley Ballas, who turned 60 this year but is certainly dancing into later life with a great deal of energy and pizzazz, to produce a series of podcasts on topics ranging from how coronavirus might impact your retirement income to sharing money with the family.

Shirley is a brilliant interviewer, who chats to other retirees and would-be retirees, as well as tapping a panel of experts for explanations of some of the trickier pensions jargon. The podcasts, which each last around half an hour, are such an easy way to take in a lot of knowledge while you soak in the bath, go for a run or finish your commute. Find the whole Rewirement series at legalandgeneral.com/podcasts.

You can also find Your Guide to Retirement Income online, our 20-page guide to a more colourful retirement. This is a straight-talking guide that sorts fact from fiction. Did you know there is a 25 per cent chance that a woman aged 65 today will live to the age of 94? Or that about 250,000 Britons aged 65 and over live overseas?

The guide helps you envisage your own, unique later life. Let’s face it, there are so many different ways of enjoying life; retirement is no longer the cliff-edge moment it used to be and you might be looking forward to part-time work, volunteering or studying for a degree. There are so many possibilities and this guide might be the best way to indulge in a bit of creative, blue-sky thinking.

One of the problems with financial planning, of course, is that you don’t know how your life is going to pan out. This is where online calculators can prove useful; many give you the option of playing with retirement dates or pension pots. Would you rather retire now on less or retire later with more? How much later and how much more? Maybe you’d rather aim at a specific goal; a calculator can show you what extra savings you need to retire in style.

You can also compare the annuity on offer from your current provider with others. If you are aged 55 or over with a pension pot of at least £2,000, try annuityready.com to compare quotes and learn a bit more about what’s on offer.

Finally, don’t forget there is personal help and guidance out there. If you prefer, you can speak to a financial adviser. Ask around for recommendations or go to unbiased.co.uk, which shows all the regulated advisers in your local area. There’s also a directory of advisers at the Money Advice Service (moneyadviceservice.org.uk), the government-run website offering free and impartial money advice. You can even get a free consultation with Pension Wise (pensionwise.gov.uk), which is also a government-run service to help you understand your pension and explore your options.

For more information please visit legalandgeneral.com/retirement