Retirement might be just around the corner, but that doesn’t mean it’s too late to boost your retirement income. Retirement and Investment Solutions share some top tips to help you make more from your money, whether it’s working part time, downsizing to a smaller property, or registering for discounts and offers, these steps can help you save that little bit extra.
- Explore your property options:
For many people facing retirement, property is the biggest asset they own. Don’t ignore this when considering ways to boost your retirement income. Moving to a smaller, less expensive property, is a great way to free up the capital in your home to buy an annuity.
Selling up isn’t your only option, if you are comfortable about sharing your home with someone, for example a lodger, you can add a little extra to your savings. The rent a room scheme allows you to earn £4,250 a year from it, tax free.
- Continue working and delay your retirement:
Reaching state retirement age doesn’t necessarily mean giving up work altogether. Many people find that stopping work at retirement can be a shock to the system, resulting in many pensioners opting to work part time or even set up their own business.
If you work past the State Pension age, you don’t pay National Insurance and your personal allowance (the amount you can earn tax free) increases at age 65. For this tax year, personal allowance rises from £7,475 to £9,490 for those aged 65-74.
If you can afford to delay drawing your state pension, it could leave you better off in the long run. For every five weeks you put off claiming, you will receive an extra 1 per cent. This equates to an extra 10.4 per cent for every full year you put off claiming. To find out more about delaying retirement, click here.
- Choose your annuity wisely:
On reaching retirement, most people choose to buy an annuity with their retirement fund, guaranteeing them an income for life. If you read our newsletter in September, you would have noticed our update on the upcoming annuity changes. As of December 2012, it will be illegal to price insurance products based on gender, affecting future annuity rates.
Anyone looking to retire in the near future should carefully consider the options available to them. Exploring the Open Market Option (OMO) can be a great way for anyone looking to utilise their pension fund most effectively. You have the opportunity to browse the whole retirement market, not just your current provider, for the right product and most competitive rates for you. Don’t assume that going with your current provider is the only option open to you.
For more details on how the new EU gender regulations will affect you and the options available, click here.
- Take advantage of the discounts and offers available:
Companies are finally waking up to the reality that the over 60s make up a fifth of the population. On top of your free NHS eye tests and prescriptions, more and more organisations are providing discounts and offers targeted at this age group. These include deals like:
- Senior Railcard - This is available to over 60s at a cost of £26, saving you up to a third off your travel expenses.
- Coach travel - Over 60s qualify for "Route 60 fares" in England and Wales which gives half price travel on National Express services
- B&Q - free B&Q Diamond Card for over 60s, which lets you have 10% off purchases on Wednesdays.
- Boots – ‘more treats for over 60s’. Simply fill in the form in store and enjoy 10 points per £1 on Boots-branded products and enjoy 25% off complete glasses at Boots Opticians.
- English Heritage and The National Trust - over 60s are eligible for discounts on both annual and life membership.
This is just a small sample of the offers available, so keep an eye out.
- Review your retirement fund regularly
Nationwide Building Society recently revealed that fewer than one in ten of us know exactly how much is in our retirement fund. If you want to make the most of your money, it is important to review your investments regularly, to ensure your funds are performing as they should.