Regularly reviewing your finances is an important step at every stage of life. But as you get older, your priorities start to shift.
As retirement edges closer, you’ll need to think about everything from savings and pension contributions to paying off debt and passing on wealth in the most tax-efficient way.
Telegraph Money has spoken to wealth managers, tax experts and mortgage brokers to set out the essential financial tasks to tackle in your 50s, 60s and 70s that will both set you up for retirement and make your money last longer.
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Reaching the age of 50 can be a major financial turning point, as Will Bryant, a chartered financial adviser and director of wealth strategy at Plum, explained: “Children may be leaving home, earnings are often at their highest, and retirement is no longer a distant concept.”
Others may still be paying off the mortgage while also supporting adult children and ageing parents. This makes it a good time to take stock of your finances.
Check your retirement plans are on track
As a first step, ask yourself whether your retirement plans are on track to reflect the lifestyle you want. You can do this by calculating your total projected income and likely expenses, then comparing the projections to your goals.
Les Cameron, of financial-services provider M&G, said: “If you’re falling short, take action by increasing your monthly contributions or consider making lump sum contributions such as with a bonus. Every extra pound you contribute now can still grow for 10 to 15 years.”
Maximising contributions to Isas and other tax-efficient vehicles can also prove valuable.
In addition, it’s worth checking your National Insurance record to identify any gaps that could result in lower state pension payments. If there are incomplete years in your record, you may be able to make voluntary contributions to boost the amount you receive.
Another important consideration at this stage is to review and rebalance your pension investments.
Mr Cameron added: “In your early 50s you still likely have 15-plus years of investing ahead, but ensure your pension’s investment mix aligns with your plans. The right mix depends on your retirement timeline and your drawdown strategy. The key is not to be caught by surprise by market volatility when you’re about to retire.”
It might also be worth consolidating old pension pots, particularly if you’ve had several jobs throughout your career. But it’s sensible to seek financial advice first to ensure this is the right choice.
