Saving for the future may seem simple enough – keep putting away a little money each month, and it will soon build up. With workplace pensions now required by law, everyone who works will have a retirement fund to draw from once they’ve stopped working. Making your savings really work means much more complex planning, and for this the differences between financial and retirement planning are important to understand.
Financial Planning and Retirement Planning
A financial plan focuses on what you can save during your working life. It calculates how much you’ll need to have saved once you stop work, and helps make sure that the steps you’re taking to accumulate savings and investments will be enough to meet that target.
A retirement plan looks more closely at what your expenses are likely to be once you stop work. It also focuses on how the assets you’ve accumulated will generate income that will see you through your retirement. It’s addressing the question of whether your assets will be sufficient to last.
Creating a retirement financial plan is a must for anyone who is concerned about whether and when they can afford to retire. And retirement is not just about surviving: it’s about enjoying your senior years, too. That’s why a retirement financial plan gets into much more detail about how you expect to spend.
Independent financial advisers who are trained and specialise in retirement financial planning will want to gather all information about your assets. This will include all your pensions from past employers as well as the present one, and any other investments you may have. If you’re not sure about old pensions, Age UK’s advice on tracing pensions can help.
Intelligent software for financial advisers provided by vendors such as https://www.intelliflo.com/ then uses this information to make projections based on when you intend to retire. It places the adviser in a position where they can inform you of the best decisions to make.
As with any financial advice, whether it’s financial planning through your working life or retirement financial planning, it comes at a cost. But a consultation fee is worth paying for the peace of mind and knowledge of what you need to achieve to provide for yourself once your working income stops.