When it comes to preparing for retirement, there can be a lot to think about - from the different places your money could come from, to how you use it and what you need from it.

This handy checklist will help get you started.

 

    • Find out if you qualify for Pension Credit.

      If you're on a low income, the Pension Credit Calculator can tell you if you're eligible for this measure.
    • Consider delaying the State Pension.

      If you choose to defer your State Pension, it could be higher when you start to take it. Find out more.
    • Check your State Benefits

      If you, or your partner, are receiving, or entitled to state benefits, you may need to declare any money you take from your pension pot to the Government. State benefits include:
      • universal credit
      • child benefit
      • or anything similar where the amount you receive depends on how much you earn or have in savings. This could have an impact on the level of benefit you’re entitled to. 

There are a wealth of benefits available to pensioners. Winter fuel allowance, free bus travel and prescriptions are just a few. For more information visit the gov.uk website.

  • Check the value of your pension savings.

    Each year you should receive a statement. This will help you calculate how much income you might receive in retirement.

    You can also do this online through your account
  • Find lost pensions.

    If you’d like to track down pension savings from previous jobs, the government’s pension tracing service could help. Please visit gov.uk/find-pension-contact-details.
  • Think about bringing your pension savings together.

    Sometimes you can get a better deal by putting all your pensions into one pot. Get advice and check if there are any charges, or if you lose any guaranteed benefits from the pension.

    Before you consider this you should check the charges linked to each pot and whether you could lose out on any valuable benefits or guarantees. If you have more than £30,000 in a pension with guarantees, such as a defined benefit scheme, you will need to get advice. A defined benefit pension is usually one that you'll have access to through an employer. The value will be based on your salary and how long you've worked for that employer.

    If you're in any doubt whether combining your pensions is right for you, you should get financial advice. You get guidance on combining your pension pots through the government’s free and impartial service, MoneyHelper.
  • Decide what to do with your pension savings.

    From cashing out your pension to getting a guaranteed income for life, there are more options for using your pension savings than ever before. You can also choose to leave some or all of your pension savings invested. You may benefit from expert advice and guidance.
  • Shop around for the best deal.

    You don't have to accept the income offered by the company you've saved with. If you want to buy a retirement product, make sure you shop around as other providers may have more appropriate products for you or be able to pay higher amounts of income.
    • Savings and investments.


      You may have other savings, types of pensions and / or investments to use as sources of income, once you're retired. You might have money put aside in ISAs, for example. If you have shares, you might receive dividends from them.
    • Find out if you can use your property.


      If you own your property, you may see it as a type of future pension. You could use it to provide a rental income, renting out a room for example, or a home, if you have a second property. Or you may be able to release some of the equity to help boost your income.

      Options include selling your home and downsizing, or using equity release or a retirement interest-only mortgage, both of which are loans secured against your home.

      We suggest you talk it through with your family first, and then get some professional advice. There will be some costs involved, and it may affect your eligibility to some means tested state benefits.

      For any of the above options, dividends, selling or renting property, there may be tax to pay. This will depend on personal circumstances and tax rates and allowances may change.
    • Make sure you understand the benefits.


      There are a wealth of benefits available to pensioners. Winter fuel allowance, free bus travel and prescriptions are just a few. Don't miss out.
    • Not ready to stop working yet?

      There’s no need to access your pension savings until you want to. You can continue to save into your pension and decide what to do at a time that suits you.

      Your pension savings remains invested which means the value can go up or down.

      If you choose to delay your retirement age, it's important to update this in your account.

    • Create a budget and see where your regular income goes.


      You may no longer have commuter expenses to worry about, work lunch to buy or a uniform to pay for. These costs add up, so you will be saving money – but you are likely to have much less disposable income now that you're retired.

      You can use MoneyHelper budget planner for more guidance.
    • Will you have any new expenses?


      Will you be playing more golf, travelling frequently or taking up new hobbies that may be costly? Perhaps your energy bills will increase thanks to longer periods at home.
    • Consider what expenses are optional...

      ... such as eating out, socialising or holidays. If you need to cut your expenditure, these are the areas you can usually target to make changes.
    • Don't forget occasional expenses.

      There are costs that don't occur each year: for example, buying a new car or replacing the computer, television or washing machine. From time to time unexpected bills may arise like household repairs.
    • Retirement Living Standards tool

      Find out how much you might need in retirement with our Retirement Living Standards tool.

A reduced annual allowance may apply. You can find out more about your annual allowance in our guide.

You should also consider how your money will be treated at the time of your death and whether there’s enough money left to provide for your dependants.

With some options your money may be subject to inheritance tax, so it’s important to consider this before you decide.

Is it the right time to retire?

If you've had some estimates or quotes for your options, and they don’t meet what you think you'll need in retirement, you could:

  • Increase the amount you save each month into your pension subject to your annual allowance.
  • Review your investments
  • Delay retirement
  • Continue working, perhaps part-time
  • Reduce your income requirements

If you do decide to delay your retirement, it’s important to make sure your retirement age and investments reflect your plans. You can review and update these in your account.

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Need some help?

There are different retirement income products to choose from and the rates they offer can vary. Shop around to make sure you get the best deal for your situation and use available guidance and advice services before you apply. Other providers may have more appropriate products or be able to offer you a higher level of retirement income.

 

Retirement guidance

Pension Wise from MoneyHelper

You can get guidance from the government's free and impartial service to help make your money and pension choices clearer.

The availability of appointments can vary between a few days and several weeks, so if you need guidance, it's a good idea to book an appointment slot now:

0800 100 166
8am to 6.30pm, Monday to Friday.
Calls may be recorded and monitored.

Send us a secure message

If you have any questions, you can send a secure message through your account. Use the link below to log in.

Get financial advice

 

Financial advisers can give you professional advice for pension planning.

You usually need to pay for their service and in return they recommend how to make the most of your pension given your circumstances.

To find and compare financial advisers please visit their website below.