How can I prepare for retirement?
It’s a scary time right now. The cost of living is rising and will disproportionately affect women, so the here and now is rightly taking precedent for many. If you’re thinking about the future then depending on your age, when you want to retire and how much money you think you’ll need in retirement, you’ll want to do different things to prepare. But some considerations include:
Figuring out when you might be able to start receiving your state pension if you’re eligible, which is a payment from the UK government and is currently £203.85 per week for the full amount, although this may change. You can work out your (or anyone else’s state pension age if you know their birth date) here.
Paying into a pension. If you’re in work and it offers a workplace pension, your employer will also pay into your pension. We explain how workplace pensions and contributions work in this newsletter. You can use a pension calculator to help you work out how much money you might want or need in retirement, which will determine how much you should be putting in now, if you can afford it. Depending on your age you might want to change what your pension is invested in as well - if you’re younger you might want riskier investments, for example. Let us know if you want to know more about the different risk levels.
Consolidating your pensions if you have had several jobs that provided workplace pensions. We took a look at the pros and cons of this in this newsletter and how to track down your old pensions in this one, as well as transferring pensions to different countries here.
How can we improve financial health amongst women?
It will not come as a surprise that women’s financial health’s statistically lower than men’s. PensionBee explores what can be done to improve it.
Seeing a financial adviser. This can be expensive and not always necessary for some kinds of retirement preparation, but advisers can help set out a timeline for your retirement and work out the tax on your money when you start taking it out of your pension, as well as how you might want to take it out.
Thinking about how you want to work before retiring. If you’re planning to go part time, for example, that may affect your pension, which we’ve explained here.
Campaigning for changes that will help close the gender pensions gap, which is currently 38%. The amount you must earn before workplaces start paying into your pension excludes more women than men because women are lower earners on average. The People’s Pension says lowering the earnings trigger to £8,628 would bring in half a million new pension savers, three-quarters of whom would be women. Similarly, things like affordable childcare and good parental leave policies are shown to reduce the gender pensions gap.
Action of the week: We were pleased to hear recently someone decided to seek expert advice based off something they’d read in Rebalancing Act. Please do keep stroking our egos and let us know if you’ve made any financial decisions since subscribing!