Planning for retirement can be a complex process, regardless of whether you are 12 months away from finishing work, or 12 years from it. You will have to work out what your major sources of income will be after you retire and find ways of maximising that income through a combination of savings and investments.
Working with retirement planning specialists in Chester or wherever you live will help you to put together a plan that suits your particular circumstances. Beyond that, there are specific reasons for hiring a specialist that are worth considering. That is what we will look at in this article.
What are retirement planning specialists?
There is no such thing as a retirement planner; rather, it is part of the job description of a financial advisor or wealth manager. Some people qualified in those areas do choose to concentrate on helping clients to prepare for their retirement years, but the knowledge and skills involved – from investing expertise to tax mitigation – are the same as those for general financial advice.
If there is a key difference between them, it is that those concentrating on retirement planning offer advice focused more on the preservation of financial assets and ensuring reliable income sources for the retirement years. By contrast, standard financial advisors will focus more on higher risk asset growth strategies.
Why should you get help from a retirement planning specialist?
There are several important ways that a professional can help you in preparing for your life after work.
Establishing your needs and desires
It will not be possible to properly prepare for retirement unless you have some idea of what you desire from your life after work. Some people want to be able to retire to the country, whereas others want to be able to travel the world after they stop working.
A retirement planning specialist will talk you through what you wish to achieve in retirement and put together a financial plan showing the sort of income that will be needed. This will establish whether your dreams for retirement are financially feasible and will identify potential ways of increasing your savings to make them happen.
Whether you want to enjoy a fun-filled adventurous retirement or keep as much money for your children and grandchildren as you can, the first step is working out a plan. You will also need to have enough set aside to cover eventualities like health problems or appliance breakdowns when you no longer have an income from work.
Help you to set a retirement date
By creating a workable plan for retirement, a specialist can help you to firm up an actual date for stopping work. This will involve knowing exactly what your plans are and how much money you will need to be able to manage after retirement, so you can then determine how long it will take to reach that financial target.
Ideally, people are encouraged to start saving for retirement as early as possible, but those who have accumulated more assets can afford to wait until later. Either way, the ability to clarify exactly what you have at the moment and what you are going to need in the future is something a retirement planning specialist can offer. That will let you set a clear timetable for retirement.
Provide a comprehensive service
Most people will have different types of assets and there are various ways that they can be deployed to work best for you. A professional in retirement planning can identify investment opportunities that have the potential to increase your assets quickly if you are later in life and do not have the time to start building up savings.
Equally, they can advise on issues such as pension freedoms. These give people aged 55 or over the option of using some of the money put aside in pension funds or leaving it untouched. Furthermore, a specialist planner will know the best methods of saving for your retirement. For example, using a pension instead of an Independent Savings Account (ISA) for your retirement money has the potential to increase the returns that you enjoy by as much as 41.6%.
That is the sort of thing that a professional can assist you with. Then there is the issue of tax.
Tax liabilities can significantly eat into the money that an individual has to retire on. Trying to navigate the UK tax system if you are not an expert can be a minefield, and no one wants to fall foul of the law. A specialist retirement planner will have in-depth knowledge of this system and will be able to highlight legal ways in which your tax payments can be reduced.
As you can see, there are a number of real advantages to getting the help of a qualified professional when you are starting to think about your retirement.