You’ve devoted a huge part of your life to inspiring the next generation. And now the time to truly put yourself first is drawing ever closer. But with 93 per cent of teachers not knowing how much to set aside for a comfortable life in retirement*, are you feeling prepared?
Here’s some things you should be considering for your upcoming retirement.
Make some time to plan
The choices you make in the later stages of your career are as important, if not more important, than those you make at the beginning.
Before you say goodbye to life as a school leader, put aside some time to come up with a solid retirement strategy. This involves thinking about having an income for day-to-day living expenses, as well as any bigger ambitions you may have.
You’ll probably have an idea of what you would like to do after you leave the classroom. But you’ll need to make some time to understand the various ways you can withdraw from your pension, and how you can use it to achieve your goals.
Write down your retirement goals
One of the first things you should do is picture what you want your retirement to look like. From travelling the globe, taking up new hobbies, starting your own business to spending more time with your loved ones, the possibilities are endless.
You could even write these down somewhere – this way they may seem more real.
You don’t have to finalise every detail, but you should at least have a rough idea of how you plan to spend your days.
Your spending habits will change
The amount of money you spend, and on what, will vary at different stages of retirement.
All being well, the first few years will be the most exciting. You’ll have a lot more spare time now you’re out of the school environment. Which means if there’s something you’ve always wanted to do, now’s the time.
As you grow slightly older, you will likely settle into more of a routine. And your spending habits may be more balanced.
Whilst today’s retirees enjoy better health and higher life expectations than previous generations, longer lives can also mean expensive care bills. There’s a chance you’ll experience these later down the line.
Understand the State Pension
Whilst the State Pension is a nice addition to your retirement income, there’s a lot of ins and outs to get your head around.
Recent research has found that most people reaching State Pension age are not receiving their full pension amount. According to MoneyAge, of the 1.1 million to have received a new State Pension between September 2016 and March 2019, only 44% received the full amount.
This raises concerns that the safety net the State Pension provides may be lower than people think.
It’s wise to check how much State Pension you’re entitled to. You can do this at GOV.UK.
Speak to a professional
As an individual approaching retirement you’ll want to feel excited about the whole process. By taking the time to talk through what you want to achieve with an adviser, you could be better placed to make the right decisions about an important phase in your life.
What’s more, it’s been found that people who receive advice from an adviser reported they felt twice as confident about being able to retire, according to 2019 research carried out for Sanlam.
We want you to feel positive over your finances. This way you can spend time enjoying the rest of your career, rather than worrying if you’re financially prepared for retirement. That’s why the NAHT has been partnered with Skipton Building Society since 2005. They’re on a mission to help as many people as possible make better financial decisions, and they want to help you too.
For flexible retirement solutions such as Drawdown your capital is at risk and you may get back less than you originally invested. The value of investments and the income from them may fall as well as rise. If you take too much income too quickly your fund could be depleted or run out altogether.
Skipton have advisers across the country that can help to de-mystify your money worries, give your finances a health check and help devise a personalised retirement plan. For peace of mind, you should know there’s no obligation to act on their advice, or any upfront fees to pay. It could prove worthwhile finding out if Skipton could support your financial well-being.
*Wesleyan (2016) – ‘Teachers puzzled by pensions’