How to make the most out of your retirement money

How to make the most out of your retirement money

Once you retire, your finances will probably be different to how they are in your working life. Most of you will have a set day of the month when a fixed salary’s paid into your bank account, which you’ll have to make last until you next get paid.

Of course, this kind of arrangement can continue when you retire, but you might not be able to guarantee that you’ll always get the same amount every month, and you might have different household expenses to cover.

Whatever your situation will be, we’ve put together this helpful guide to help you make the most out of your retirement money.

Know your budget

Keeping track of how much you’ve got coming in and going out every month is just as important once you’re retired as it is now. You might have fewer expenses as you’ll hopefully have paid off your mortgage and won’t need to spend money on commuting or other work items. However, there might well be a few extras to take into account though, like holidays and hobbies.

Try and boost your pension pot

If you’ve still got a few years until you actually retire, it’s a good idea to put as much away in your pot as you can. Increasing contributions, switching funds (always take advice with this option) or delaying when you retire can all help you take a bigger retirement income or make it last longer.

Check for old pensions…

If you’ve moved jobs a lot, or taken any private policies out, it’s possible you could have pensions out there you’ve forgotten about. Set some time aside to dig old paperwork out, or contact the Pension Tracing Service or the government’s find pension contact details if you think you might have an old pension or two from a previous employer.

… and claim what you’re entitled to

As well as your private or workplace pension, you’ll be able to take the state pension. Exactly when that will be depends on your age, but you’ll get if for life once you’ve started claiming. You might also be eligible for pension credit and other benefits once you’re retired too, so it’s worth checking exactly what you can claim.

Review your investments

All that money you’ve been saving can be a big boost to your retirement income, so now’s a good time to check it’s working as hard as it can do ready for when you retire. If anything’s not performing well, think about changing where it’s invested or if you can do anything different with it. Just bear in mind the possible tax implications of doing this, or any fees and charges you might incur.

Look for other forms of income too

There’s nothing to stop you working (full or part-time) once you’re retired if you want a bit more money, although doing this might take away from the pleasure of your retirement. Other options include downsizing your home, releasing some equity or even taking in a lodger, where you can earn up to £7,500 per year tax free.