Great Things To Know Before You Retire Hunt

MSE_Martin

What's it about?

Well, it does what it says on the tin to be honest. I'd like to tap the wealth of knowledge of retired MoneySavers to see what tips you'd give those in their last few years before retirement. Is there something you've learnt since retirement that you wish you'd known before?

What to do?

Whether it's about pensions and annuities, selling up and moving abroad or simply down-sizing. Let other MoneySavers know any tips you have that would help those coming up to retirement.

My starter for ten

While Im not in retirement, my most important pointer would be ensure you choose the right annuity from your pension pot (if you get an annuity at all). This is one of the most important financial decisions you will make in your lifetime, as once you've got it - often it can't be changed - read more on annuities.
Click reply to post your tips.

Bogof_Babe

When my husband got a quote from his employers for his pension, while deciding whether to take vol redundancy/early retirement, he was given a fixed figure - either a certain fixed lump sum and so much per annum, or no lump sum and a greater amount per annum.

No mention of annuities was made, or the need to sort one out. His pension was a final salary contributory scheme, so perhaps this is why it differs from the scenario of annuities?

I've always been a bit confused by all this, and I bet I'm not the only one. Any clarification will be gratefully received.

Ken68

TIME will be a big asset when you retire. No deadlines to meet, even the smallest gain can be built into your daily routine.
TIME to do gardening and get all that free produce. TIME to walk to the library instead of taking the car.Free books, free computer use, free newspapers.
TIME to attend auctions, fetes, church bazaars. TIME to talk and make new friends.
TIME to try out all the suggestions on this site, and save a fortune.
TIME even to give away to others with less time.

margaretclare

Hi Martin, a good topic for discussion.

My most important tip? Do your darndest not to be in debt in the years coming up to retirement. Why do I say this? I've only recently heard of an instance in which a bloke was made redundant not long before he became 65. He's been struggling to live on redundancy money until his SRP kicks in, and he's recently topped-up a secured loan that he had, because 3 large items of household equipment all needed replacing at once. Surprise surprise, he had cards and loans already maxed-out and is concerned about his credit rating. He thinks that mortgage providers and loan providers are not so ready to repossess your home as they were a decade or so ago, so he'll be OK (he says).

This is the kind of thing I mean. Do some planning in those last few years while you still have a regular source of earned income. Think where you want to live the rest of your life. You might not have to live where you do now, in easy reach of a job. If the family are all grown-up and flown the nest, do you really need a family-sized home with stairs, a large garden, a bath that you have to climb into? Think - knees and hips getting more unreliable. Think what may make life easier for you in 10, 20 or more years. If you need to modernise or even to downsize, do it while you're still (relatively) young and fit and have an income.

Think also - energy-saving. Energy prices are going crazy, and switching may not be the answer because the energy providers are all in the same boat. If you think you might not be able to go on driving, think about convenient bus-routes.

Just a few ideas that spring to mind, no doubt there'll be others.

Best wishes

Margaret Clare

scoder

Bogof_Babe wrote:

When my husband got a quote from his employers for his pension, while deciding whether to take vol redundancy/early retirement, he was given a fixed figure - either a certain fixed lump sum and so much per annum, or no lump sum and a greater amount per annum.

No mention of annuities was made, or the need to sort one out. His pension was a final salary contributory scheme, so perhaps this is why it differs from the scenario of annuities?

I've always been a bit confused by all this, and I bet I'm not the only one. Any clarification will be gratefully received.

The major difference between final salary schemes (which I assume your husband has been quoted for) and personal pensions (requiring annuity purchase), is that a good final salary scheme will/should produce a far better return than any personal pension.
There would therefore be no need for your husbands' employer to mention annuity rates as the two types of pension are different animals. Hope this helps a little.

merched99

This might save you thousands if you are being made redundant and are lucky enough to have a final salary pension scheme. You can put any redundancy payment above £30,000 (which would normally be taxable) into your pension, and get it straight back again tax free under the rules about converting part of your pension to a lump sum -- but ONLY if you are eligible to draw your company pension. For some reason (at least with my scheme) they can't tell you about it unless you ask....... In my case I was going to leave a few months before turning 50, and would have had to pay tax at 40pc on the lump sum. Found out by chance about this, and have now got agreement to stay the extra few months until my 50th birthday so can take advantage of it.

KMK

I am so thankful that I did not opt for the lesser NI stamp when I got married in 1970 as I am eligible for a full state pension in my own right soon, as well as my occupational pension. I would advise women in particular to get advice about pension saving well before retirement.

I would echo the point about time and being able to use it wisely. Before I retired I never went to the libary.Now I do not buy books but read the reviews for the forthcoming books and then reserve them. Public librairies are wonderful, often unappreciated, institutions. I just did not have time to use them before retirement. Adult Ed too is worth pursuing.

I can also search out the best offers etc on the net for a whole range of things. Going on holiday during term time is great!

I do community work which is very interesting.

margaretclare

KMK wrote:

I am so thankful that I did not opt for the lesser NI stamp when I got married in 1970 as I am eligible for a full state pension in my own right soon, as well as my occupational pension.

Yes, absolutely. Making that choice - not to pay the lesser NI stamp, which only covered you for industrial injuries - was one of the best decisions I ever made in my life.

If you don't get an occupational pension, paying the full rate NI also entitles you to SERPS, now S2P, and this is hugely valuable.

I would advise women in particular to get advice about pension saving well before retirement.

Yes, agreed again. Don't rely on someone else to make this provision, or to find out things, on your behalf - do it yourself!

Margaret Clare

jassie_2

I too would agree that paying the full rate NI was a good decision for me although I have not quite reached retirement yet, and won't get a full pension due to time off bringing up a child, I will still get more than if I relied on my husband's contributions. What I don't understand though is that although I have been working part time for the last few years and been credited with NI contributions I have been told that I have some years where I should make up a shortfall. I have earned over the annual limit but not the monthly limit. Many enquiries to the NI office have brought mixed advice!

margaretclare

jassie wrote:

I too would agree that paying the full rate NI was a good decision for me although I have not quite reached retirement yet, and won't get a full pension due to time off bringing up a child, I will still get more than if I relied on my husband's contributions. What I don't understand though is that although I have been working part time for the last few years and been credited with NI contributions I have been told that I have some years where I should make up a shortfall. I have earned over the annual limit but not the monthly limit. Many enquiries to the NI office have brought mixed advice!

Jassie, provided your time off bringing up a child was after April 1978 and you were receiving Child Benefit, you will have been awarded Home Responsibilities Protection for all of those years.

I don't know about the possible shortfall. CIS is the expert on this one.

Best wishes

Margaret Clare

TARA_2-2

You may have a secure envelope or box at your Bank. Therein you may keep for example your Will and House Deeds. My Bank charged £35 per annum. I found out by accident that once I reached 65 I did not have to pay this fee. I had reached age 67 and "lost" £ 70. Maybe your Bank will have different rules regarding the qualifying conditions. The saving whilst small perhaps will pay for something else!