What’s stopping you from retiring sooner? For many, it’s not just finances that are holding them back but their mindset too. If the excitement of retiring is also mixed with nerves, a financial plan could give you the confidence boost you need to take a step back from work.

Finances may play a role in the hesitancy to retire for some people. Yet, others are in a financial position to retire but are still worried about taking that next step. It’s easy to see why you might not want to plunge straight into retirement – it could represent a huge lifestyle change.

So, how could financial planning help you retire sooner? It may provide the confidence boost you need to start the next chapter of your life.

A retirement plan starts with setting out your goals

If you had more free time, how would you spend your days? Retirement is a great opportunity to think about what makes you happy and build a lifestyle around those activities.

Setting out how you’d like to spend your days in retirement could make the lifestyle shift seem less daunting.

For some, that might mean enjoying a slower pace of life now you don’t have to adhere to a work schedule. For others, days packed with plans could be far more appealing, so think about what works for you. 

You might look forward to being able to spend more time with grandchildren during the school holidays. Or maybe you’ve got plans to transform your garden.  

As well as the day-to-day lifestyle, you might want to consider one-off experiences you’d love to make part of your retirement plan too. Perhaps you’ve always wanted to go on a cruise to Alaska, take a university course, or train for a marathon – now could be the perfect time to think about the things you’ve wanted to try and simply put off or haven’t had the time to do. 

While setting out your retirement lifestyle could be the nudge you need to give up work, the financial side of retirement might still be a cause of worry for some people. Fortunately, with your goals laid out, you can start to calculate how much you’d need to secure the retirement you want, and assess if you have “enough”.

Most people retire between the age of 55 and 65

According to a report from the Institute for Fiscal Studies, most people retire between the ages of 55 and 65. At age 55, 81% of men are in paid work, and this figure falls to 44% by age 65. For women, the employment rates fall from 74% to 34% over the same ages.

That means many people are retiring before the State Pension Age, which is currently 66 and gradually rising to 68. So, if you aim to retire sooner, you might need to consider how to use your assets to fund all your outgoings initially.

Even when you reach the State Pension Age, the income you receive from the State Pension often isn’t enough to meet all your expenses. In 2024/25, those entitled to the full new State Pension receive around £11,500 a year.

As a result, your retirement plan is likely to need to consider how to supplement the State Pension during retirement. 

Understanding how to create a sustainable income in retirement can be challenging, and there are lots of factors you might need to consider, such as longevity and the effect of inflation on your income needs.

A financial plan that’s tailored to you and the lifestyle you want in retirement could help you assess how to create an income and how your wealth will change during your lifetime. Having a financial plan you can have confidence in could give you the freedom to really enjoy your retirement. 

Contact us to talk to us about your aspirations for retirement

If you’re thinking about retirement and could benefit from a confidence boost, we’re here to help. We’ll work with you to create a financial plan that brings together your retirement aspirations and financial circumstances. Please get in touch to arrange a meeting to talk to our team. 

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance. 

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.  

2 in 5 UK retirees have retirement regrets, according to a Canada Life survey. If you’re saving towards your future, you could learn some valuable pension lessons and avoid repeating the same mistakes.

Securing the retirement you want often means thinking about this milestone many years before you celebrate it. One of the key challenges is balancing your financial needs and goals now with your long-term ones. Retirement regrets indicate it’s something many people struggle with.

So, if you’re still working and saving for retirement, here are three lessons you could learn from older generations. 

1. 17% of retirees wish they’d increased pension savings while working 

The Canada Life research suggests one of the biggest retirement regrets is simply not saving enough – 17% of those surveyed said they wished they’d increased their pension contributions. Similarly, 12% said they regret not making lifestyle adjustments earlier in life to allow them to save more for their later years.

While auto-enrolment means you’re likely to be paying into a pension if you’re an employee, simply paying the minimum contribution may lead to a pension pot that falls short of your expectations. 

Indeed, a report from the Phoenix Group, noted: “There is widespread consensus that current auto-enrolment contribution rates are unlikely to provide an adequate retirement income for most savers.”

The report advocates increasing the default pension contribution rate from 8% to 12%. While the current government hasn’t indicated that it plans to do this, you can choose to increase your contributions, and some employers also offer higher pension contributions as part of their benefit package.

As your pension is often invested and benefits from compounding over a long time frame, reviewing your contributions now could mean the extra money really starts to add up.

The report notes that changing the minimum contribution level to 12% now could lead to a typical 18-year-old today having an extra £96,000 in their pension at retirement. However, as the graph below shows, delaying by even five years could lead to significantly less. 

Source: Phoenix Group

Having a clear goal can be useful if you want to ensure you’re saving enough – how much do you need in your pension at retirement to live the lifestyle you want? From here you can work backwards to understand how much you need to contribute to your pension to make your goal more achievable.

Of course, setting a pension pot target isn’t always straightforward. You’ll often need to consider areas like life expectancy, inflation, and investment returns. Working with a financial planner could provide you with a tailored retirement plan that considers these factors. 

2. 43% regret not accessing advice or guidance

Separate research from Standard Life found that more than 4 in 10 retirees regret not accessing advice or guidance either at the point of retirement or when they were still working. The survey results found:

• 51% wished they had more information about how to plan and prepare for their retirement
• 42% said they should have sought advice or guidance to plan for their retirement
• 37% said they should have sought advice or guidance before they accessed their pension savings.

You don’t have to be nearing retirement to benefit from professional financial advice. Seeking advice ahead of retiring could be useful throughout your career. 

A tailored retirement plan could help you assess what steps you may take to improve your financial wellbeing once you stop working, and regular reviews provide an opportunity to see if you’re on track and what adjustments you might make. 

3. 8% of retirees say they would have retired later than they did 

Perhaps surprisingly, the Canada Life survey revealed that 8% of retirees wish they’d retired later than they did. 

For some, this regret may come from wishing they’d delayed retirement so they could contribute to their pension for longer and enjoy greater financial security now. Yet, the report notes that others wished they’d worked for longer due to the potential mental health benefits. 

Work can provide a structure and sense of purpose that some people miss once they retire. Phasing into retirement by slowly reducing your hours or taking a less demanding role could help you strike a work-life balance that suits you.

Incorporating your lifestyle goals into your retirement plan, rather than simply focusing on the numbers, could be useful too. Considering how you’ll fill your days in retirement and what will continue to make you happy might mean you’re less likely to live with regrets. 

Get in touch to start planning for your retirement 

It’s never too soon to start thinking about your retirement. In fact, taking control of your retirement plan sooner could mean you have more options, enjoy the retirement you’re looking forward to, and offer peace of mind during your working life. Please contact us to arrange a meeting to discuss your retirement plan. 

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance. 

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.