Some of the decisions you make as you retire could affect your income and lifestyle for the rest of your life. Yet, data suggests that many retirees aren’t taking financial advice and it could mean they face hardship in the future.

According to the Great British Retirement Survey, only 27% of retirees in 2021 sought the services of a professional financial adviser.

Separate research shows that many people prefer a DIY approach when managing their finances. A Scottish Widows report found that almost half of households have never accessed professional financial advice.

While financial advice that’s tailored to you can be valuable throughout your life, it can make a huge difference when you make milestone financial decisions.

If you’re nearing retirement and haven’t sought the support of an expert, here are seven compelling reasons to do so.

1. Understand your different pension options

One of the big decisions you’ll need to make when you retire is how and when to access your pension.

If you have a defined contribution (DC) pension, you are responsible for ensuring it will provide an income for the rest of your life.

There are several options you will need to weigh up. These include purchasing an annuity to create a guaranteed income or taking a flexible income.

Even if you have a defined benefit (DB) pension, which provides a regular income for the rest of your life, you may still need to make important decisions. For example, you may have the option to take a lump sum out of your pension if you accept a lower income.

These decisions can have a lifelong effect and may be overwhelming. A financial planner can explain the options to you and demonstrate what they would mean for your retirement.

2. Consider how you could use other assets to create an income

While your pension plays a crucial role in creating a retirement income, you may want to use other assets too.

Pulling together these different sources, from property to investments, can be complex. You will need to consider which sources to access first, the tax implications of doing so, and ensure you don’t deplete the assets too quickly.

A financial planner can help you bring together all these different elements to provide security in retirement.

3. Have confidence that your assets will last a lifetime

Retirement can last several decades, and it can make managing your finances challenging.

Running out of money in retirement is a common fear. According to abrdn, almost half of retirees are concerned that they will face a shortfall. A financial plan can help you see how the decisions you make at the start of retirement will affect the long term.

A professional can also help you consider how your income needs may change during retirement. This may be because of your lifestyle goals or outside factors, such as rising inflation.

Inflation is high– it was 10.1% in the 12 months to July 2022. Retirees that didn’t consider how they’d cope if the cost of living increased may find they’re struggling or are depleting assets faster than expected.

4. Check you’re making the most of tax-efficient allowances

Tax efficiency can help you get the most out of your income and assets when you retire.

Do you know how to spread pension withdrawals to minimise the Income Tax you will be liable for? Or what tax you could be liable for if you dispose of some assets? A financial planner can help you understand the taxes that affect you and the allowances you could make use of.

If your estate could be liable for Inheritance Tax, being proactive could ensure you leave more for your family.

5. Consider your long-term security

Even when you carefully create a retirement plan, some things can go awry.

A financial planner will help you identify what could happen and put things in place to provide you with security if they do. This could be steps like ensuring you have an emergency fund.

It may also cover life changes, for instance, what would happen if an accident or illness meant you couldn’t make decisions on your own? A robust financial plan may include naming a Lasting Power of Attorney (LPA) to make decisions on your behalf if you’re unable to.

While it’s hoped you won’t need to use an LPA, having it in place could provide you with long-term security if something happens. Despite this, a survey from Canada Life revealed that 77% of over-55s have not registered an LPA.

6. Create a retirement plan that considers other goals

When you retire, creating a stable income to achieve the lifestyle you want will usually be a priority. However, you may have other goals that are important to you too.

Perhaps you want to help grandchildren get on the property ladder or ensure you leave behind a legacy for your children. Whatever your goals are, a financial planner can help you understand how to reach them. By making them part of your retirement plan, you’re far more likely to achieve these goals.

7. An effective plan can provide peace of mind

Finally, creating your retirement plan with the support of a professional can provide you with peace of mind.

Regular reviews can also mean you feel confident that your plans will remain on track. Knowing that you have someone to ask questions when things change means you can focus on enjoying your retirement.

Are you ready to start planning your retirement?



If you would like to discuss the above, please feel free to get in touch. Our local, friendly team of Independent Financial Advisers will be happy to provide advice and suitable recommendations tailored specifically for you.

Give us a call on 01788 571122 and we will be more than happy to help.

The information provided is based on our current understanding of the relevant legislation and regulations and may be subject to alteration as a result of changes in legislation or practice. It does not constitute advice. All references to taxation are based on our understanding of current taxation law and practice and may be affected by future changes in legislation and the individual circumstances of the investor. 

PJL Financial Services Limited are authorised and regulated by the Financial Conduct Authority.