Investing
Six things to consider when planning your retirement
Planning for retirement can be daunting, particularly when faced with stubborn debt. Follow our checklist to get your finances in order.
The UK’s retirement nation is collectively managing mortgage and personal debt to the tune of £105.5bn, with the average personal debt now £6,952.
According to research from retirement specialists MGM Advantage, 13% of retirees are managing mortgage debts totalling £76bn, while 34% of retired people are managing loans, overdrafts and credit card debts worth a cumulative £29.5bn.
Andrew Tully, pensions technical director at MGM Advantage, said: “These figures are alarming and show the pressure people face on a daily basis trying to balance the household budget.
“Although many people consider themselves retired they are continuing to pay off their mortgage, some with quite substantial balances. Dig a little deeper and many people are working part time, sometimes through choice but often simply to make ends meet.”
The research also showed 6% of retired people aged 55 and over are working part-time to supplement their incomes in retirement.
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Recent research from VoucherCodes.co.uk revealed nearly half of retirees in the UK worry about their day to day finances, with 44% claiming they have to count the pennies and budget just to get through the month.
Tully concluded: “Talking about debt in retirement will be a taboo for many people who find themselves in this position. But there are ways retirees can access practical help and advice.”
Things to consider when planning for your retirement:
1. Claim all state benefits to which you are entitled, to check, go to www.gov.uk/benefits-adviser.
Recent reports suggest that pensioners are missing out on up to £5bn a year in unclaimed pension credit, housing and council tax benefits, as well as attendance and disability living allowances.
2. Keep a track on any old personal or occupational pension arrangements. If you think you might have lost track of an old pension arrangement, you can check via the Department for Work and Pensions tracing service here www.gov.uk/find-lost-pension.
3. You can check if you have any old savings accounts which you might have lost touch with over the years by going to www.unclaimedassets.co.uk.
4. Don’t just accept the annuity rate offered by your pension provider. You should shop around for the best rate and you might qualify for an enhanced rate because of lifestyle and/or pre-existing medical conditions.
5. Seek professional financial advice as this will help you get the best product and rate for your individual circumstances. To find an independent adviser go to www.unbiased.co.uk.
6. You may have old National Savings accounts or Premium Bonds. To check for unclaimed prizes please go to www.mylostaccount.org.uk or contact NS&I here www.nsandi.com for further information.