Pension planning is, of course, likely to be only one part of your retirement income. As Paul points out, “pension planning is probably not going to enable you to retire on the lifestyle that you’ve become accustomed to, so you will need to start to take advantage of other investments”.
You should assess what your potential asset structure could look like and the different options you have to build out your balance sheet.
- Utilise your ISAs – like your pension, always make sure you are utilising your ISAs as they are incredibly tax efficient. For example, if you take out a Lifetime ISA, the government will give you a bonus worth 25% of what you pay in, up to a set limit, every tax year.
- Assess your investment risk profile – how diversified is your personal portfolio? As you get closer to retirement, it makes sense to look at your risk-return parameters. At Coutts, you can speak to your private banker, who can facilitate access to professional advice so that you can align your investments to be appropriately structured in the way that is best for you to meet your lifestyle requirements and for passing on to your family.
- Consider your property assets – There are two areas to consider here: Are you considering downsizing your main residence on retirement, possibly releasing a tax-free capital sum, and do you intend to pass this in part or wholly on to your children? Secondly, do you retain any investment property or holiday homes and what potential income might you generate from these?
“Building a clear picture of your retirement is about reflecting on the outcomes you wish for in terms of your own lifestyle needs,” Paul says.
But it is not a puzzle you need to solve on your own. At Coutts, you have access to a portfolio of professional skills, including chartered financial planning specialists. We have the professional knowledge and experience of advising clients like yourself to help you determine the best way to fund the lifestyle you want when you retire.