Retirement is a stage of your life that many look forward to for years but it comes with unique challenges when it comes to managing your finances. When you stop employment and no longer receive the monthly income you are accustomed to then it can cause some stress and uncertainty for the future.
With careful planning and strategic decisions you can increase your income when you retire and create financial security for yourself and your loves ones.
Below are various strategies you can use to help boost your income when you retire:
1. Delay your state pension
You do not automatically receive your state pension, you have to claim it from the government. If you wish to delay receiving your state pension then you do not need to do anything until you decide you want to start claiming it.
The longer you delay your state pension, the more income you will receive. Your State Pension will increase every week you defer, as long as you defer for at least five weeks.
Your State Pension increases by the equivalent of one per cent for every five weeks you defer. This works out as 10.4 per cent for every 52 weeks.
2. Transition to part time work
If you are concerned about your income being sufficient when you retire, you could transition into retirement by changing to a part-time role rather than retiring immediately. This will mean you still receive some income and might still benefit from company pension contributions which would further boost your pension pot. Many people opt to transition into retirement rather than retiring completely to keep them mentally and socially engaged. Another option would be to take on some consultancy work when you feel you need it.
3. Get professional investment management
A financial adviser at Four Wealth Management can manage your investment portfolio for you. Active management of investments can help make sure that your investments stay on track and that the underlying funds are suitable for your individual circumstances and attitude to risk.
Your financial adviser can help you to calculate how much income you can take from your investments if you need additional income each month while keeping the majority invested so that it can hopefully continue to grow in value.
Book a no-obligation meeting with a financial adviser now
4. Rental income
If you own a property then you could consider renting out part of your home or your vacation home to generate additional income to supplement your retirement savings.
5. Downsizing
You could release a large lump sum if you were to downsizing your family home. You could then invest the lump sum and draw a monthly income from it. Downsizing will also reduce your overall expenditure as your bills and running costs will reduce.
Take financial advice before making retirement decisions
There are many options and ways to increase your income when you retire. However, it is important to note that some decisions are irrevocable and may have tax implications – such as when you choose to take money from your pension pot. Taking financial advice before making any decisions could be invaluable and help you to make more of your retirement.
At Four Wealth Management, we offer a no-obligation meeting with a financial adviser at your home address, at one of our offices or on zoom.
Book online now or call us on 0117 973 0500.
The value of an investment with St. James’s Place will be directly linked to the performance of the funds selected and the value may therefore fall as well as rise. You may get back less than you invested.
The levels and bases of taxation, and reliefs from taxation, can change at any time and are dependent on individual circumstances.
