What can I do now to plan for my retirement?

In our latest blog, PM+M financial planning director, James McIntyre, explores what you can do to ensure you have sufficient funds available for the lifestyle you require when you retire.

I don’t know about you, but the weeks and months seem to be flying by!? The consequence of this being that it can be hard to find time to prioritise your own personal financial planning needs or find time to consider your future. This is where your financial adviser can step in and assist.

What do I want from retirement?

The first step, prior to implementing a plan, is to consider what you want from your retirement. If you know when you plan to retire and have a general sense of how much income will be required to fuel the desired lifestyle and necessary standard of living, you can work backwards and determine how much you need to save.

Cashflow Planning

A cashflow analysis can help give you a sense of direction i.e., to understand how much you should be investing, for how long and the required growth rate (pre and post retirement) to ensure sustainability throughout retirement.

We can also provide some “what if analysis” to test various scenarios e.g., what if I want to retire earlier, what if there was a market crash or what if I didn’t achieve the required growth rate.

This will then enable you to start saving the right amount, have a sense of when you might be able to retire and understand what growth rate is required.


As we all know, inflation is not our friend, and we are all feeling these pressures. According to the Bank of England, the cost of a loaf of bread has more than doubled over the last 30 years. Therefore, investment growth is going to be essential to maintain the value of your wealth in real terms, as well as to build it ahead of inflation.

If you invest £100,000 and achieve a net growth rate of 4% pa., it would be worth c. £148,000 after 10 years, but c. £163,000 if a growth rate of 5% pa. is achieved. Your cashflow analysis will help indicate what growth rate you need to achieve to meet the retirement needs you require.  But remember, there is a trade-off between risk and reward. Higher risk investments have great growth potential but could also be subject to greater volatility.

It’s important to ensure that your investments are also fit for purpose; your financial adviser can help ensure that they are invested in the right way.


You can potentially contribute up to £20,000 per annum into an ISA and potentially up to £40,000 pa. into a pension. It’s important that you are making the most of your allowances and benefiting from tax efficiency wherever possible.

But it’s important to speak to your financial adviser as there are certain stipulations and pitfalls when it comes to allowances, for example:

  • The pension annual allowance tapers downwards for high earners
  • If you have already accessed your pension, you may be restricted
  • Employees need to have relevant earnings to back up any pension contribution

State Pension

It’s worthwhile using the Gov.uk online tool to see whether you are on track to receive a full state pension, click here. If you aren’t, you may be able make additional voluntary national insurance contributions to fill any gaps you may have in your record. These generally represent great value for money and the break-even point in retirement could be around 4 years.

Do you need some help?

If you want to understand what is required to ensure that you have sufficient funds to enjoy the retirement you want, and deserve, please get in touch by clicking the button below.

Increasing number of over-50s heading for a retirement crisis – are you one of them?

According to the latest report by the Pensions Policy Institute (PPI), up to a quarter of individuals nearing retirement (over five million workers) will not have enough money to pay for an ‘adequate’ standard of living.

Worsened by the pandemic – a large number of over-55s faced increasing levels of redundancies compared to all other age groups*, leading to individuals ending their careers sooner than planned, or before they could afford to.

The Pensions and Lifetime Savings Association recently reported that only one in three people can expect a ‘moderate’ life in retirement (highlighted in the table below), which is equivalent to £20,200 a year in income.


Single householdCouple household
Outside LondonLondonOutside LondonLondon


*Pensions and Lifetime Savings Association

For a more accurate way of calculating how much is enough in retirement, try using the Money Advice Service’s pension calculator here.

How to tackle a pension shortfall…

Contribute more into your pension

One way to ensure you will have enough for your retirement is to increase your pension contributions whilst you are still working. Current rules allow you to save up to £40,000 (or 100% of your earnings, if this is lower) into a pension, whilst taking advantage of tax reliefs. However, since 6 April 2020, individuals with an adjusted income over £240,000 or a threshold income over £200,000, will have their annual allowance for that tax year restricted – in this case, you may benefit from speaking to a financial adviser to determine the best course of action.

The PPI have recently called on the government to double the current minimum auto-enrolment contribution to 16% of wages to ensure workers are saving enough for retirement. Stephanie Hawthorne, Pensions World editor, backs this up in her article for ICAEW, stating ‘auto-enrolment pension contributions must rise as a matter of urgency’.

Why not take this opportunity to review the amount you are paying into your workplace pension and take advantage of employer contributions?

Ensure you receive a full state pension

Individuals are able to obtain a ‘state pension forecast’ by visiting the government website here. This tool can be utilised to ensure there are no gaps in your National Insurance contributions – if there is, it may be worth making these up, so you receive as much as possible upon retirement.

Speak to a financial adviser

If you are worried about a pension shortfall affecting you, speak to a financial adviser. We can help you consider the following:

  • How much you already have saved into your pension
  • The number of years you have left to work before retirement
  • How much you can afford to contribute to your pension, considering your other financial commitments
  • Whether you are expecting to increase/decrease pension contributions in the future
  • Do you have any other investments, and will they grow between now and retirement?
  • How much will your employer contribute to your pension?

We also use cashflow modelling software that can consider your assets and expenditure, highlight how much you need to save, highlight what growth rates are required and and create a long-term plan to ensure you meet your needs in retirement.

Get in touch

With a complex array of pension legislation and products available, it is more important than ever to seek professional and independent advice to ensure you are making the right decisions for your future. Contact our wealth management team (01254 679131 / wealthmanagement@pmm.co.uk) who will happily arrange a meeting at no cost to help you achieve more from your pension and long term financial plans.


  • Analysis by Rest Less based on Office of National Statistics figures