Coronavirus: Martin Lewis advises on pension savings
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Pension savings can be challenging to build up as people think about short-term rather than long-term costs. However, if a person does not build up enough cash, they risk being left financially unprepared in later life.
According to one expert, individuals should start planning for their retirement now to avoid running out of money later down the line.
Concerns have continued to grow about the financial stability of Britons in retirement.
This is particularly the case as life expectancy is increasing, and people are spending a higher proportion of their lives in retirement than ever before.
Rachael Bell, Practice Principal at Rachael Bell Wealth Management, 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.
“People are living longer these days so you could be retired for 25 or 30 years, or even longer.
“Planning for this eventuality is key to ensuring a comfortable retirement right until the end.”
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However, Britons are not powerless to change these dire circumstances, and could prepare themselves ahead of time.
Firstly, Ms Bell recommends having a firm idea of what age a person would like to depart the workforce.
This, she said, will help individuals to formulate their long-term plans and goals.
In a similar sense, forecasting both medium and long-term financial goals will assist in keeping Britons on track.
Individuals should always try to get into a regular savings habit to help them to put money aside frequently.
Clearing debts and payment plans wherever possible can also help to accelerate towards a goal.
Finally, Ms Bell stated, Britons should always set up an emergency fund they can access if needed for unexpected life events.
Typically, experts suggest this fund should be worth three to six months of living expenses.
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Ms Bell concluded: “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.”
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