Discover the value of your entire pension pot now.

Get Pension Audit Sheet
Oaklands Details

0121 355 4455
info@oaklandswealth.com
12A Duke Street
Sutton Coldfield
West Midlands
B72 1RJ

Oaklands Wealth Management Ltd

Retirement planning – how much do I need?

Working out how much you need in a pension when considering retirement planning takes some getting your head around.

Not least because you are essentially transferring money from today to your future life.

For most of us there’ll be at least 40 years at work to fund up to 40 years or beyond in retirement. What we don’t put away now can’t be drawn from in the future.

But how much do you really need to retire on?

We call it The Number. The amount you need in your pension the day before you retire. The pot you have the rest of your life to live off, assuming you have no other income.

The Number depends on 3 key factors. I’ll leave the most important one until last.

  1. Firstly, your expected lifespan. I know it’s not something any of us wants to dwell on for too long, but for the purposes of planning your retirement you need to arrive at a figure to base your assumptions upon.

Average life expectancy stood at 83.1 for a woman and 79.4 for a man between 2017 and 2019 -the most recent data available from the Office of National Statistics.

Those reaching age 65 lived on average for another 18.8 years if male (reaching age 83.8) or 21.1 years if female (reaching age 86.1).

You’ll notice these are averages, so there will be some people living considerably longer than these ages.

What assumptions should you make for yourself?

My advice is always plan to age 100 which is what we do for our clients unless there are health reasons to suggest their lifespan will be shortened.

Retirement Planning to age 100 will ensure you should never run out of money.

  1. Assess the cost of your lifestyle.

Starting with a simple spreadsheet you’ll need to note all monthly income and expenditure. This may change upon retirement with mortgages paid off, and work-related expenses reducing. On the other hand you may wish to spend more on holidays and leisure activities.

With this in mind you’ll need to prepare a 2nd version of your spreadsheet which will anticipate your expenditure throughout retirement.

You don’t have to move far down this process to realise there’s a whole host of assumptions which need to be built in to your calculations and need updating each year.

Assumptions like:

  • Rate of inflation
  • Rate of investment growth
  • Taxation
  • State pension

And you need to ‘crash test’ the figures you come up with to withstand market downturns and recessions where the values of many investments can fall considerably.

  1. Regular pension contributions

Many people do not take their pension contributions seriously until they reach their 40s or 50s. It’s important to understand that while we all want to live the best life we can right now, not saving enough for retirement will mean working longer than you expected or a reduced standard of living later on in life.

However, there’s no need to panic – you may have some past employers’ pensions which could be combined into a personal pension under your control.

The fact you are reading this article means you are taking your future seriously.

The aspect which makes the most difference to how much you can build is regular pension contributions for as much as you can afford.

This really is an area in which independent financial advice for retirement planning pays off. A good firm will have sophisticated cashflow planning software which can give a detailed idea of the date at which you can reasonably retire and how much you’ll need to have in your pension to live the lifestyle you desire.

While that end number is different for everyone, knowing it in advance and having a sound financial plan and active fund management in place remains a good strategy for everyone.

Interested in finding out more?

Seeking a second opinion on your financial future costs you nothing.

Simply call our friendly team on 0121 355 4455 or drop us an email to appointments@oaklandswealth.com to arrange a confidential chat.

Oaklands Wealth Management, founded by Helen Blackburn in 2004 advises clients around the Midlands on retirement planning, pensions & investments.

Her firm holds British Standard BS 8577 for client service & investment process.

Minimum investment is £500,000 (£650,000 for pension transfers).

IMAGINE YOUR PENSION & SAVINGS 100% UNDER CONTROL…
Arrange a chat

Similar articles

OUR INDEPENDENT FINANCIAL ADVISORS

Click to view profileHelen Blackburn IFA Pension Transfer Specialist
Click to view profileNick Hampton Investment Advisor

THINKING OF MOVING FROM YOUR EXISTING ADVISOR?

It’s easy to move on from another advisor.
We’ll handle everything.

All that’s needed is for you to sign some letters of authorisation and we’ll do the rest.

None of your investments will be switched into new funds until you’ve agreed with our recommendations and you’re fully happy with any changes we propose.

Schedule a chat

7 KEY FEATURES OF THE OAKLANDS WEALTH MANAGEMENT SERVICE

British Standard BS 8577 Awarded Service

12 Month Money Back Service Guarantee

Lifetime Cashflow Planning

Risk Adjusted Personal Investment Portfolio

ISO 222222 Certified Financial Advisors

Monthly Fund Analysis

2 Investment Portfolio Reviews Per Year

A WORD FROM OUR CLIENTS...

“After great dissatisfaction with the service of major high street banking group I approached Oaklands to manage my pension and investment portfolio. They have provided sound advice on pre- retirement planning and achieved a good return on our capital as well now in retirement. The service offered by Helen and the team at Oaklands is second to none.”

Peter Worral

A WORD FROM OUR CLIENTS...

“Upon leaving Rolls-Royce after 26 years, I wanted to transfer my pension into an investment fund but find anything investment related a ‘black art’. Helen reviewed my circumstances and risk profile to develop my portfolio. Every Oaklands’ team member I’ve seen is an established professional and I would recommend Helen and her team in a heartbeat.”

Ian Foster

A FRIEND FOR YOUR FINANCIAL JOURNEY...

THIS IS NOT A DIY SERVICE – WE TAKE FULL RESPONSIBILITY FOR SETTING UP YOUR PENSIONS AND SAVINGS. FOR LIFE.

No half measures. We don’t set it up then leave you all at sea. We manage your investments ongoing and hold ourselves accountable for steering you through your financial journey.

This phrase came from a client who said that’s exactly what we felt like to him, he said “you are like a friend or good neighbour who’s always got my best interests at heart.”

Whatever the reason you come to us we care. We really care. Like it’s our own money.

Tidying up bit and bobs of pensions and putting them neatly in a pot you have full control over.

Maybe transferring a final salary pension if your objectives are better met with your own pension.

Making sure you get all the tax efficiencies legally available to you to enhance your money.

Pointing the microscope on 3,000+ funds and finding the best ones to secure your retirement.

Get in touch
FEES
FEES
Find out more
OUR TEAM
OUR TEAM
Find out more
CLIENT JOURNEY
CLIENT JOURNEY
Find out more
ACCREDITATIONS
ACCREDITATIONS
Find out more