“The key to good retirement planning is not to ‘take your eye off the ball’. Remember that your pension is based on a number of underlying funds investments. How they perform, year on year, dictates how much you will have to live on in retirement. Make a free pension enquiry now to check how your pensions investment is performing, and that it matches your risk profile, while working hard for you in the best-performing funds!”
Michael Kennedy, Director of Financial Planning
Click here now for Pension Advice or call 0800 678 5929
Constant checks are key to pensions planning
Any good gardener will tell you that a plant needs regular tending, in order to grow and flourish as it should. The same principle applies to long-term savings for retirement, whether these be direct funds investments, or investments in a personal pension.
With any kind of pension, your money is invested on into a number of investment funds, and the returns from those funds are the ‘pension pot’ you take with you into retirement.
It is crucial to keep tabs on how your funds are doing. This year’s star fund may not meet those expectations in future – and no-one ever remembers who was second in the Derby.
At Principle First, we ensure that your pensions planning stays on-track by constantly checking back on how the funds that contain your pension savings are performing.
Only we can offer you our unique risk profiling system, to assess your level of risk so that your pension contributions are where you would like them to be. With our state-of-the-art funds analysis system, we can look inside your investments and tell you if this is where you should be and if not, make recommendations on where your savings will be better invested.
At Principle First, we believe that this flexible, responsive pensions investments service is second to none, and guarantees that your pensions savings are best-invested to meet your future needs.
Request pensions advice online or call 0800 678 5929 to speak to an adviser
Investment Funds in Retirement Planning
While a pension may form the cornerstone of retirement planning for most people, there are many alternative investments to underpin your financial wellbeing in your golden years.
Given that the basic state pension currently pays out just £4,953 per year, equivalent to £95.25 a week, the option to include other investments is certainly worth a look. No better reason to speak to a financial adviser, capable of delivering quality retirement planning advice. This should be done at least annually, in order to effectively monitor your pensions investments, and update them if necessary.
Investment funds come in various types, and offer access to a range of interesting possibilities to suit all tastes. Before recommending a fund or funds as part of your retirement planning, a good adviser will measure your attitude to risk, by assessing your ‘risk profile’. Investors are generally classified as ‘very defensive’, ‘defensive’ (very conservative and risk-averse) to cautious (less averse) to balanced (willing to take some risk for a potentially higher return) and on to ‘moderately aggressive’ and ‘aggressive’ (eager to take a relatively high risk for potentially very high returns).
It is well known that stock market and equity investments generally outperform cash, over the longer term.making them ideally suited to planning for retirement.
Another aspect to bear in mind with funds is that they are flexible, and that by working with your financial adviser you can switch your money to a better fund, if your current one isn’t performing. Furthermore, your investment risk profile may change as you come closer to retirement, and you may wish to reduce your exposure to stock markets and shift your money into more cautious funds, in the latter stages of planning for retirement. For that reason, funds investments – like any other – should be reviewed on a regular basis.
Check your investment risk profile
ISAs for tax-efficient Retirement Planning
Another long-term savings option as part of your planning for retirement is the trusty Individual Savings Account or ISA. ISAs come in two models, the cash ISA and the stocks and shares ISA, and offer some attractive tax savings on growth. Investment interest from a cash ISA is paid free of Income Tax, while growth in a stocks and shares ISA is free of Capital Gains Tax and Income Tax.
Investment in ISAs is subject to limits and conditions that will be explained by your financial adviser. For the financial year starting in April 2010, the maximum annual investments are £5,100 in a cash ISA, and £5,100 in a stocks and shares ISA. Alternatively you may invest your total allowance of £10,200 in a stocks and shares ISA. Bear in mind that you can run your ISA indefinitely, adding money up to your allowance threshold every year and building a tidy nest egg as part of your retirement planning. And unlike a pension, where your money is tied up, ISAs are available which offer various options for easy access to your cash, should an emergency arise.
Planning for retirement with Property
Purchasing a property on a buy-to-let basis can certainly be factored in to your retirement planning. However, it is no secret that residential property investments have been sailing through a long red valley of tears in recent years, with dire consequences for those entering retirement who have found that their investment was worth only a fraction of what they had anticipated. The property boom of the 1980s and 1990s had, perhaps lulled many into a sense of false security regarding the inherent value of bricks and mortar. Consequently, the need to consult a financial adviser, and take advantage of his more informed market perspective, is clear.
Click here now for Pensions advice or call 0800 678 5929
