The Southeast of England offers a high quality of life, but it is also one of the most expensive regions in the UK. For those aged sixty and above, especially those in or approaching retirement, rising prices can put pressure on fixed incomes, pension pots, and long-term financial plans.
If you have noticed your utility bills, weekly food shop or council tax becoming more expensive, you are not alone. Reviewing subscriptions, memberships and luxury spending to see where adjustments can be made without sacrificing your quality of life can be a useful exercise. A simple monthly budgeting tool available now from many banks and building societies can be a useful starting point.
If you are drawing from pensions, savings or investments, inflation could quietly be eroding your spending power. Regularly reviewing how your pensions and assets are invested and whether changes need to be made is good practice. When managing your levels of cash savings, are you being overly cautious? When were your investable assets last reviewed and are they too adventurous / cautious based upon how you intend to spend the money? It is also important to assess if your assets are adequately spread or diversified through varying investment types (cash, shares etc) to take account for a current more volatile investment backdrop.
Another aspect to consider is whether you are accessing your savings and investments in the most tax efficient manner, making use of allowances and tax breaks. It is worth bearing in mind that we fully expect pension legislation to change, which means preserving and passing on pension funds after April 2027 may become less tax efficient. How you have been taking income from your investments over the last ten years may no longer be so appropriate moving forward.
Linked with these expected changes to pension legislation, revisiting the value of all your assets and what taxes your estate may face is becoming increasingly topical. Things to consider are if you are spending enough, making uses of the varying exemptions, gifting from surplus income and if you have fully considered mainstream trust planning strategies.
We find that mapping your income, expenditure and considering what you want to do in retirement can be particularly useful. Our starting point is to make use of cash flow planning software to help our clients understand how robust their financial position looks.
If you would like to have an initial discussion around your financial planning objectives both now and moving forward as your circumstances evolve, then please make contact.
