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As we live longer healthier lives retirement planning takes on a new meaning and is of vital importance if you are to enjoy a happy and healthy retirement. No longer need it be a time of inactivity engenderedby a feeling of uselessness. Rather, many of today’s senior citizens, enjoyactive, productive and enjoyable lives.
It is the time when you can take up all those hobbies you never had time for,travel more, maybe move to an area you always wanted to live in but couldn’t due to workrestraints,spend more time with your family, enjoy your garden and justgenerally spend each day doing something you find pleasurable rather thanhaving to go to work.
Of course it can be a wrench to leave your job and colleagues. A feeling of worthlessness can settle in as the sense of “being someone” is no longerthere. However accept your retirement as the next and exciting part of your life and make the most of it.
This is were retirement planning comes in and the earlier in life you start this the better. All the pleasures of retirement can only be enjoyedif your income is sufficient to support you and your spouse. In additionit has to grow with inflation as people are living longer and longerand obviously what supports you at 60 or 65 will not be adequateat 80.
Retirement Planning- Pensions.
First and foremost you need to get a pension projection from both thestate pension department and also any private pension scheme you maybe a part of.
Take a look at the debts you have, including your mortgage, and see if it is possibleto clear these before retiring.
Generally speaking it is not felt that the state benefit provides an adequate income for retiring and so it is important to look at privatepension plans, the government are in fact encouraging people to buildup their own pension funds with generous tax incentives.
These make the growth on the value of a pension fund tax free and allow some of the fund to be drawn in the form of a tax free lump sum. In addition any payments made by you qualify for tax relief. The majority of pension plan types give tax relief at source which means that you only pay the net amount (e.g., a £100 contribution costs you £78).
Of course the earlier you start your process of retirement planning the betterbut even if you do not have a long time left to save for your retirement you should still consider retirement planning. Recently there have been many changes to the charging structures applied by the Pension Providers. This means that even if the period until your retirement is quite short you should still get a good overall return on the money you invest.
Retirement Planning-Your Health.
In order to enjoy a long and happy retirement your health is almost as importantas your money. Take stock of your general physical condition and improve it were youcan. Adopt a healthy lifestyle by eating nutritious, balanced meals and taking plenty of exercise. If you take your health seriously and look after yourself it will paygreat dividends as you age.
In addition you may want to consider taking out some health insurance.
Whilst the NHS is there to take care of us we all know that the reality cansometimes be very different, especially with regard to the time we may have to waitfor treatment, so this in itself could be a good reason to take out a health insurance policy. In addition more and more people are retiring abroad and so may want the peace of mindof adequate private health insurance.
Another form of insurance you may wish to consider as part of your retirementplanning is long term care insurance. We are all living longer and most of us look forward to long and active retirements. But with longer life expectancy comes the increased possibility that we will need help or care later in life. This help is often referred to as long term care. Many people think the government will pay for their long term care, and many get a shock that this is not the case. You may for instance be forced to sell your house in order to pay for it soan insurance policy to cover care costs could prove vital.
Retirement Planning-Moving House.
With the incredible rise in house prices that has taken place in recent yearsmany people find themselves in possession of a very valuable asset, their home.
As part of any sensible retirement plan consideration should be givento selling this asset and moving to a smaller and cheaper property,downsizing in current parlance, and thus releasing valuable equity thatcan be invested to top up your pension. Alternatively there are variousequity release schemes which are worth looking into.
Retirement Planning-Inheritance Tax.
Again due to the substantial house price rises more and more people willfind that their inheritors will be liable for inheritance tax. Careful planning can help to avoid a lot of this however and considerationneeds to be given to transferring assets to your children whilst you arestill alive.
In conclusion then it is never to soon to start planning for your retirement. The better off financially you are at that timeof life and the healthier you are the more you are going to be ableto enjoy it and make your retirement years some of the best years of your life.