38 RETIREMENT
PROTECT YOUR RETIREMENT POT AGAINST INFLATION by Martin Collins
Chartered financial planner, Pareto Retirement Planning. Be Prepared.
For anyone feeling the effects of rising inflation, it’s important to ensure that your retirement fund isn’t significantly impacted.
So how can you protect your pension income for the future?
Postpone Retirement Delaying retirement may allow you to better prepare for future financial commitments.
You have more time to invest and contribute funds towards your pension pot and invested funds have the potential to generate returns that outpace inflation.
The Retirement planning journey begins by assessing your financial situation and setting goals.
By planning ahead and maximising tax efficiency, you can avoid shortcomings and realise your desired lifestyle in retirement. We work with Beever and Struthers ensuring you take advantage of tax incentives and employer contributions, maximising your savings potential.
We don’t look at pensions in isolation. Protection, tax planning and other areas are explored to provide a holistic service to best meet your needs.
Review One way to ensure that your retirement savings aren’t affected when inflation is high, is by diversifying your investments across different asset classes.
Diverse portfolios can help protect you from losses due to market volatility and/or inflation.
Keep track and adjust your investment strategy accordingly.
Keep contributing Continuing to contribute to your pension pot can be wise. Regular contributions can take advantage of volatile investment conditions.
Not only is your retirement fund likely to outperform cash savings over the long-term, but it also allows you to take advantage of the tax relief top- up offered by the government.
The amount of relief you receive is based on the rate of Income Tax that you pay.
For those with a defined contribution pension who are taking an income, it might be beneficial to reduce the amount you are withdrawing to keep more of your pot invested.
This could help protect your retirement fund against volatile markets and rising inflation.
Regularly revisiting your retirement planning is essential to ensure your long-term security and prosperity.
investments can go down as well as up. For more information contact Martin Collins from Pareto, who is the preferred Financial Planner for Beever and Struthers via
www.beeverstruthers.co.uk
MAKING THE MOST OF YOUR ANNUAL CONTRIBUTIONS
by James McIntyre Partner, PM+M
HELPING YOUR MONEY ACHIEVE MORE
Investments Lifetime cashflow planning Business and personal protection Pensions Court of Protection advisory Tax and estate planning
Get in touch today: 01254 679131
financialplanning@pmm.co.uk www.pmm.co.uk
PM&M Financial Planning Ltd is authorised and regulated by the Financial Conduct Authority
For the tax year 2023/24 the annual allowance for pension contributions was increased from £40,000 to £60,000 meaning you can potentially make much larger contributions towards your pension in a tax efficient manner. This includes any payments made by yourself or your employer.
However, if you’re a higher earner, your annual allowance would be tapered, where the amount you are able to save into your pension plan would gradually reduce each year depending on how much you earn.
The annual allowance is reduced for those who have adjusted income over £260,000 a year and it reduces by £1 for every £2 over £260,000.
There is also the possibility of carrying forward any unused pension allowances from the previous three tax years, this could potentially add up to a large sum of money that you
are able to add to your pension tax free, which is something certainly worth looking into.
Another major change for the new tax year was the removal of the lifetime allowance, previously the most you could build up in pension savings in your lifetime without facing any tax charges when you take them out was £1,073,100.
This could be great news if you have already been affected by the allowance or are getting close to the limit, as you could look to top up your pensions savings without worrying about paying any extra tax.
Do you think you’re making the most of your pension contributions? It is more important than ever to ensure you are making the right decisions for your future. Get in touch with a member of our financial planning team to find out more.
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