The study conducted by Scottish Widows found that:

• 20% of us, equal to more than 10 million people, say they will work until they are physically unable
• 51% expect to work on a part-time basis in retirement
• One in 20, around three million people, will work until they die

While some of these people might continue to work because they enjoy their job or perhaps run their own business, the reason why the majority will be forced to do so is far simpler; they aren’t putting enough money to one side for the future. Indeed, Scottish Widows research shows that 44% of people over the age of 30 aren’t saving enough for their retirement.

Tips to help you improve your retirement

If you aren’t among that rare breed of people happy to work until they are unable to do otherwise and the thought of a lengthy and happy retirement appeals, how can you make sure it becomes a reality?

Here are six things for you to consider:

1. Save more

It isn’t rocket science; spending less and saving more will lead to a more comfortable retirement.

As you will see as you read on, there’s more to it than that, but at a very basic level, you need to be saving a realistic amount for your retirement.

It might be helpful to change your thinking. Rather than seeing pension contributions as a bill or a cost, consider them as a way of simply (and sensibly) deferring a proportion of today’s income until the future.

2. Take the help that’s on offer and put your trust in pensions

There’s no doubt that some people simply don’t trust pensions and consequently avoid them. Unfortunately, the people who take that view miss out on one of the most effective ways of saving for their retirement.

Up to a limit, which most people don’t get close to reaching, pension contributions receive tax-relief. That means for every £80 contributed by a basic rate taxpayer (those who pay 20% income tax) a further £20 is added to their contribution. Higher rate taxpayers (paying 40% income tax) can claim a further £20, reducing the net cost to just £60.

The price to pay for receiving the tax-relief is that you currently can’t access your pension until you are at least 55. That age is rising too. However, that it isn’t a problem for most people as they won’t have accumulated enough to retire on by the time they are 55.

Furthermore, if you are employed and earn over £10,000 each year, you can join a workplace pension to which your employer must contribute.

Finally, all contributions grow tax-efficiently.

As millions of us aren’t paying enough into our pension in the first place, the twin helping hands of tax-relief and employer contributions are compelling reasons to overcome any mistrust you have of pensions.

3. Focus on how your money is invested

You will hopefully make pension contributions throughout your working life. That might span several decades, during which time your contributions are invested on your behalf.

The more effectively they are invested the better.

It’s not enough to simply make the contributions and sit back hoping for the best. You need to take an interest in how your pension is managed; the investment returns you receive and the charges you pay. If you don’t have the time, inclination or interest to do so, that’s where professionals, such as ourselves, can help.

4. Repay debt before you retire

Retiring with debt, whether a mortgage or unsecured credit, means a proportion of your pension income will be swallowed up by monthly repayments.

Ideally, you should plan to have repaid all debt by the time you intend to retire.

5. Build a plan

For most of us the period of time between now and retirement can be measured in years rather than months. That presents both an opportunity and a threat. An opportunity, because it gives us time to save and repay debt. A threat, because it’s all too easy to put off building and implementing an effective retirement plan.

And that’s what’s called for, a plan.

It doesn’t have to be complex, but it always starts by understanding the basics; including the income you will need in retirement, the lump sums of capital you may require and when you would like to finish work.

You then need to build a picture of the progress you’ve made so far. That means understanding your State Pension; what you will get and when, as well as projecting forward the income your existing pensions will provide when you retire.

You can then compare the amount you need to your projected income. If there’s a shortfall you need to plan to bridge the gap. That might mean paying more into a pension, delaying retirement, reducing the income you need, or a combination of all three.

Again, that’s where we come in. We help our clients understand whether they have a shortfall in their retirement planning and then build a plan to plug it. We don’t stop there either, reviewing the plan regularly to ensure it remains on track. That leads us neatly on to our final point…

6. Take advice

It will come as no surprise that we believe financial advice will help you achieve your retirement goals.

However, there’s growing independent evidence which shows the value in taking financial advice. For example, a study by the International Longevity Centre UK and Royal London showed that those people who took financial advice had accumulated up to £43,245 more than their non-advised peers.

Furthermore, 90% of those who took advice were satisfied with the outcome.

Do you want to work until you drop?

If you are happy to continue working and never retire that’s fine and entirely your choice. However, if you harbour dreams of retirement and would like to know whether they will one day become a reality, we are here to help.