Workers urged to plan better for retirement or risk running out of money

Rachael Bell Wealth Management Practice Principal stands with her arms on a stair bannister with a smile on her face. She is brunette and has a white and blue striped shirt which is open with a white t-shirt underneath — Rachael Bell Wealth Management Practice Principal

‘Start planning for your retirement now to avoid running out of money later in life’.

That is the message from financial advisers Rachael Bell Wealth Management, of Carlisle, as concerns continue to grow about the financial future of retirees, particularly as people need to plan for the possibility they could live until they’re 100 with the UK’s life expectancy levels continually increasing.

Just this week, figures from global investment company Abrdn revealed that nearly half (4 per cent) of the 2,000 retirees polled in the UK were worried about running out of money in retirement – but a total of 78 per cent had never sought advice from a finance professional.

Rachael Bell Wealth Management Practice Principal is highlighting the importance of planning for your future to ensure that the money accrued by the time retirement comes around will last the distance.

She said: “It’s understandable that retirement is an emotional time for people because it is such a major life event after working hard for so many decades, and it’s only right that people should be able to enjoy their retirement to the fullest.

“However, there are often levels of anxiety and fear about whether finances will last, and that is why it is crucially important to take a positive approach and plan properly for peace of mind.

“The latest figures show that nearly half of retirees do have these worries, but these concerns can be wiped out if they seek professional help and make sure they have a suitable plan in place well in advance of their retirement.

“People are living longer these days so you could be retired for 25 or 30 years, or even longer, so planning for this eventuality is key to ensuring a comfortable retirement right until the end.”

To ensure peace of mind and make sure a foolproof retirement plan is in place, Rachael recommends the following steps:

Have a firm idea of what age you would like to retire to help formulate your long-term plan;
Forecast both medium-term and long-term financial goals to keep you on track;
Get into a regular savings habit throughout your working life, and try to clear debts or payment plans wherever possible;
Set up an emergency fund you can access for the unexpected life events you can’t plan for.

Rachael added: “A big part of feeling assured that you’re doing something positive towards retirement is to get into a regular savings habit. This is particularly the case at a time when the pandemic has made more people aware of the strength of their financial position and what they can do to bolster it.

“While we’ve seen lots of hardship over the past couple of years, we’ve also seen a lot of people take the opportunity to clear debts, overpay their mortgages, increase their savings and generally build their financial resilience for a more comfortable future.

“As retirement is such an emotional subject, people can make rash decisions about their finances.”

The statistics from Abrdn revealed that 24 per cent of people living in the North West were more likely to seek advice from a finance professional, while men (25 per cent) were slightly more likely than women (19 per cent) to contact an expert.