Stock markets remain volatile, fears of inflation are creeping up and the possibility of tax rises to repay the pandemic debt have caused a growing number of retirees concerns about their income in retirement.
Unless you are fortunate enough to have a final salary (or defined benefit) pension, then your pension funds are likely to be invested in a multi asset fund which is at risk of fluctuation due to influence from stock markets. A recent study looked at the top concerns among those that intend to retire within the next 10 years. More than half (56%) of respondents expressed concerns about spending too much and running out of money in retirement. Just over 40% were concerned about losing money in retirement due to a drop in the Stock Markets.
In a separate study, just under 60% of financial advisors thought that their clients needed to accumulate more money before retiring to ensure that they were financially secure. However many were too close to retirement to take the risk of investing in high risk/high reward funds.
The desire to live a long and fulfilling life is one of the greatest risks to retirement security. A person can live to such an advanced age that they will deplete their pensions and savings entirely and have to rely solely upon the State Pension. Whilst the State Pension pays an income for life, bear in mind that it only represents about 1/3 of the UK average income. For most retirees that would leave a significant gap between the income they receive and the income they want to spend on enjoying retirement.
Whilst outliving savings in retirement is a real risk, you can take steps now to help replace those concerns with confidence. The process starts with getting your pensions, savings and investments reviewed by an Independent Financial Advisor at LFBB Financial Services. We can help you establish what retirement savings you have and what income you draw. We will then put a plan into place to best protect you from the volatility of financial markets, but also seek growth to keep above inflation. It is never too late to get your house in order.
Contact us today on 0114 272 9721 for a free financial review and consultation.