Home Insights & Advice How best to plan your retirement at any age

How best to plan your retirement at any age

by John Saunders
22nd Oct 21 3:45 pm

The age at which you can claim your State Pension is constantly changing. As recently as 2018, this was set at 65 years of age – and it’s believed that by 2028, this will increase to 67.

Planning for your retirement is not just a one-time event, it’s life-long planning in the making – and it’s important that as you move through every step of life, your plan also advances with you.

For some, seeking professional financial planning guidance from a financial adviser is necessary. Their expertise can offer peace of mind, as you head towards a stress-free future.

In this age-by-age guide, we will discuss some of the best practices in planning for your retirement, so you can achieve your lifetime goals – without needing to worry.

In your 20s

You may feel as though it’s too early to start thinking about retirement and savings, but the truth is, it’s never too early. The sooner you start researching your options and educating yourself on finance, the more prepared you’ll be to have a financially viable future.

In terms of putting a retirement savings plan together, there are numerous options. If you’re wanting to make a tax-efficient investment, an Individual Savings Account (ISA) is a good choice. However, most people will look to open a pension plan – and you’ll be automatically enrolled to a workplace pension, if you work for an employer. While you can opt out, it’s best to stay enrolled, if you can afford to. As well as deductions from your pay, your employer will also make a contribution to the scheme.

In your 30s

While it may seem that financial planning has gone on the back-burner, as you reach new milestones – like paying off a mortgage or supporting your family – it’s still crucial to stay focused on retirement. It’s also believed that by the time you’ve hit your 30s, you should aim to have a pension pot equal to three times your annual salary.

It’s important to stay disciplined with your savings, as this will be beneficial in the long run – and ultimately, will ensure you can live out your dream retirement. It’s also good to know that while your investments will be locked away, they will have more time to recover from any falls in the market. With this in mind, you could consider investing in riskier areas, which have a greater long-term return.

In your 40s

By this stage, the likelihood is that you’ve worked for numerous employers and consequently have accrued different pension pots. Now is the time to consolidate these pensions – making it easier to manage your savings. Take stock of your savings and ensure your retirement plan is on track, by using a pension calculator.

This useful tool will estimate the size of your pot at retirement, or provide a target income to aim for – as well as forecasting the income you could expect to receive if you were to opt for annuity or a drawdown.

  • Annuity: an insurance policy that converts your pension fund into income (a fixed regular payment each year) that will last for the rest of your life.
  • Drawdown: allows you to keep your pension invested in the stock market and take money out of (or drawdown) from your pension.

In your 50s

At this stage, time is running out – and you’ll need to make specific plans to ensure it all remains on track. Now is the time to make retirement planning a priority. Some of the questions you’ll be asking yourself, include:

  • How much money will you need to retire (comfortably)?
  • Have you got enough money to live off?
  • Will you need to save more?
  • Will you need to work more to reach those figures?

Gov.uk provide a great service, whereby you can see how much State Pension you could get, and when you can get it. Take this into account, alongside any other pension plans you may have.

Many of us aspire to have that dream retirement, and the best way of fulfilling that is by planning early. Get some financial advice on how to draw your pension in a tax-efficient way and look to build up a fund with every passing decade. Retirement planning should be stress-free, allowing you to enjoy your life once you’ve finished working.


The above information does not constitute any form of advice or recommendation by London Loves Business and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Appropriate independent advice should be obtained before making any such decision.

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