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pensions might seem like a horribly
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daunting complex or distant concept but
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the reality is the earlier you engage
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with them the better your chances are of
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having the kind of retirement you
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want so here's a five-point checklist
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that could help you have a healthier
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pension number one think about how much
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money you might need to live off in
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retirement according to the Pensions and
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Lifetime Savings Association a single
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person currently needs about Ā£31,000 for
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a moderate lifestyle and retirement
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which includes one foreign holiday a
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year but these numbers are completely
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individual so it's important to think
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about how much you personally will need
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remember to factor in inflation as
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that'll eat into your retirement income
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two use a pensions calculator to
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forecast what your income might look
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like in retirement most people's
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retirement income will be made up mostly
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of their private pension savings
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supplemented by some state pension you
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can get a forecast of how much state
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pension you'll receive by the government
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website gov.uk for most of us these days
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our private pension is a defined
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contribution pension which means that
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rather than getting a guaranteed income
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for life you accumulate savings over
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your career into an investment pot that
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you then need to live off in retirement
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you can check how much you currently
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have by adding up the total amount in
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each of your employer pension schemes
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and any other personal pensions you have
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there are lots of good calculators out
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there that can tell you what approximate
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annual income your savings pot could pay
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you in retirement how many years that
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would last for or what size pot you
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might need to accumulate the income you
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want three if you're not on track for
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the pension you want you might want to
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consider increasing your contributions
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currently the minimum amount that is
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paid into your pension is 8% of your
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qualifying earnings 5% of which comes
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from yourself 3% of which comes from
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your employer however lots of research
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suggests that for most people that won't
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give them the kind of lifestyle they
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want in retirement remember that paying
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into a pension comes with tax benefits
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as an extra upside to being savvy and
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saving for retirement four ask whether
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your pension investments are right for
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you unless we choose otherwise in most
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cases our pension savings go
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automatically into a default fund this
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invests in a portfolio of assets for you
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including a mix of stocks and bonds and
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the makeup of the portfolio usually
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changes over time becoming less risky as
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you near retirement it's important to
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consider whether that default portfolio
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is right for you personally some people
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choose to take more risk while they're
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young in the hope of better returns
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others want to make sure their pension
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is invested sustainably by engaging with
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your pension and reviewing your
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investments you can make these kinds of
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choices five consider consolidating your
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pensions most of us will work multiple
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jobs over our lifetimes and end up
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accumulating lots of different pension
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pots having money spread all over the
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place makes it really hard to know
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whether you're on track you might find
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it easier to engage with your pension if
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you consolidate all those different pots
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into one if you're not sure where all
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your old employer pensions are the
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government has a pension tracing service
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which helps you track them down please
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remember this is not financial advice if
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you would like financial advice you
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should speak to a financial adviser
