Whilst you may not have even thought about a pension, let alone started saving for one, fear not, there’s still plenty of time. No-one knows what the future will hold but what we do know is, if you have sufficient funds available then your options for the future will be open-ended.
Life in your 30’s can be busy and somewhat difficult financially with the many life events that come your way, such as saving for a mortgage. However, the earlier you start to think about and save for a pension, the easier it will be in future.
Why do you Need a Pension?
Although you will be entitled to a State Pension, at present for the current year 2019/2020, your entitlement is £168.60 per week. Although this amount may increase over the years, it likely will not be enough to allow you to live a healthy, comfortable retirement. Therefore, it is important you look at starting to save to enable you to have additional funds available for your retirement.
How to start saving?
First of all, before you even think about starting to save for a pension, it is important to evaluate your monthly income alongside your monthly outgoings, including adding into any additional savings you have. Generally, it would be advisable to put as much away as you can possibly afford each month or if at any point you have any spare money available. For example, if you receive an increase in income. In doing this, you will then be able to clearly see how much you will have come the time of your retirement. The best way to do this would be to join your workplace pension scheme, where both yourself and your employer make a contribution from your monthly salary. One of the benefits of joining your workplace pension is that if you move jobs you don’t need to worry, your pension stays with throughout your working life.
Furthermore, if it is feasible for you to save any extra money each month, as well as, contributing to your workplace pension, then it would be worth setting up your own way of saving for retirement. This can be done by opening up a savings account, such as an ISA or looking into your own personal pension.
Consider your assets
Whilst there are many options for saving for your future, it is important to also consider any additional assets that may contribute towards your retirement. Whether you already have a mortgage or are currently saving for one, it would be worth looking at when it will be paid off. If you are in a position where you will be mortgage-free by the time you retire, then this could be beneficial to you for many reasons. For example, you could choose to sell your house, moving to a smaller property. This would then give you some extra money to include in your retirement fund. However, before you are ready to retire and make any decisions about your future and retirement funds, it would be advisable to have a discussion with a financial advisor on the best route.