If you have been saving a decent percentage of your wage since your twenties and you’re looking forward to spending your generous retirement, have you considered that you might not have saved enough to cover a long retirement? It is a fact that human beings have a longer life span, but a higher risk of developing illness or disease. Have you considered that your retirement could last 40+ years or have you also considered the key events that could reduce your pension pot?
Will Your Parents Require Financial Assistance?
Your pension fund may have to support your parents who have lived to a ripe long age, but have depleted their finances and are unable to obtain support from an outside source. Long-term medical care can be expensive, as are prescription medicines. A healthy individual is far less likely to experience long-term sickness and have to depend on medication for a wholesome life. Therefore you should teach your parents about organic foods and exercise.
Monies for Long Term Care
If you are ever struck down with a long-term illness and require care, you need to work out whether your pension will fund this or should you think about life or sickness insurance cover.
Supporting Your Children and Family
Although there are a lot of jobs being created in the economy, unemployment still factors highly. If your child is out of work and struggling financially, no parent wants their child to suffer so think about setting aside a percentage of your retirement fund to help your children.
Early Retirement
Retiring at age 50 can be very expensive, but if you have saved enough, it is possible to experience a comfortable early retirement.
Unexpected Travel Plans
Your children may get married abroad or your best friend might move abroad. Set aside a small budget in your retirement fund for travel expenses. These are events that you will not want to miss and you deserve to experience life to its fullest.
Inflation Deflates Monetary Value
The pound has greatly devalued due to high inflation. It is important that you account for inflation in your pension. Consider what gas and electricity prices will be when you retire and will you have enough in your pension pot to live a warm and comfortable life without worry. Increase the amount you save from your wage each year by several percent to ensure that you do not run into difficulty when you reach your retirement.
The Expense of Moving
If you have paid off your mortgage but your current home is large and timely to clean, you might consider moving into a smaller property. However, the cost of moving is also expensive. Will you have the money to buy a new property outright? Have you considered the cost of hiring a removal company? How far will you be moving from your family? These are all important factors to consider.
Tax Cuts to Pensions
There may be a possibility that the tax code or pension entitlement programmes can change in the future. Nothing is certain when it comes to budgeting. Do not rely on a government system of support, even if you have paid your contributions throughout your working life. There is no guarantee that there will be financial assistance available.
There are a lot of factors to consider before planning for your retirement. The money you save currently may be enough to live on comfortably in today’s financial climate, but the financial market is volatile. In addition, inflation increases the price of everything and you need to consider whether your current pension will be enough at your retirement. Have you considered whether you may need to move home, assist your parents, or support your children?
About the Author: Kay Brown is a writer who believes that there are many factors to consider with retirement, which is why pensions reviews can help you to determine whether you will be able to retire comfortably as they show you what your financial future will look like.
