Manage your money in retirement

Money Advice Service

Your financial situation will almost certainly change when you retire. Your income is likely to fall and our spending patterns often change as we get older – for example, because mortgages and other loans have been paid off. Read on for useful tips on managing the financial changes retirement can bring.

Draw up a budget for your retirement

Don’t wait until after you’ve retired to deal with changes to your financial circumstances.

Many of these changes can be estimated and prepared for in advance. The links below will help.

By drawing up a budget for your expected income and spending as early as possible you’ll give yourself a much greater sense of control over your situation.

You can always revise your budget later to reflect any areas where your estimates were wrong.

If your budget reveals a gap between your spending and your income, then you need to look for ways to increase your income, cut your spending, or both.

Identify possible cuts in your spending

Your budget of income and spending might identify areas where you’re spending more than you might have expected, and where you think you could easily spend less.

To take a more systematic approach to finding savings, follow the links below to use our Quick cash finder and to read some of our articles on cost-cutting.

Look for ways to increase your income

Boost your pension if you still have time

If you haven’t retired yet, you might still have time in the last few years before retirement to boost your pension income by increasing your contributions by as much as you can afford.

This option can be especially attractive if your employer will partly or fully match your extra contributions.

Another option might be to defer the date on which you start taking your pension income – this can increase your income because your savings have longer to build up and your pension will be payable for a shorter period.

Track down your personal or workplace pensions

It can be surprisingly easy to lose track of a pension, particularly one from a job you might have held early in your career.

The easiest way to find an old pension is to contact the Pension Tracing Service on 0845 6002 537.

For more information, click on the link below.

Claim your State Pension and other government entitlements

Make sure you claim any State Pension entitlement you’ve built up.

Your State Pension won’t be paid to you automatically – you must claim it.

You should also check whether you’re entitled to Pension Credit or other retirement benefits that might be available to you.

Follow the links below for further details:

Review the performance of your savings and investments

It’s a good idea to keep some savings in an easy-access account in case you need it in an emergency.

Three months’ spending money is often recommended, but smaller amounts will also give you a valuable cushion.

If you have additional savings or investments, you should review them regularly to make sure your money is working as hard as possible for you.

Consider whether your home might be a source of income

If you own your home, it probably represents a large proportion of your wealth.

You might be able to access some of this by using equity release.

In effect, this means you receive a loan now, which gets paid off later when your home is sold if you move in with relatives or into care, or on your death.

A less far-reaching way of generating an income from your home is to take in a lodger if you have the space.

Under the government’s Rent a Room scheme, no tax is charged on the first £7,500 a year you earn from a lodger.

Work during your retirement

There is nothing that requires you to stop working just because you’ve begun taking a pension.

It might not be your first option if you’ve been looking forward to retirement as a time to relax, but continuing to work – perhaps part-time – is one of the most effective ways to boost your income.

This article is provided by the Money Advice Service.

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We want you to understand the positives, but also the limitations of using our site. We operate in a journalistic manner and therefore all information, guidance or suggestions provided are intended to be general in nature, and you should not rely on any of the information on the site in connection with the making of any financial decision.

When we set out to build Rest Less Money, we wanted to be a trusted place where you could find helpful information about financial matters affecting the over 50s. As a free to use resource, we try hard to provide the best information we can, but we cannot guarantee that we won’t occasionally make mistakes. So please note that you use the information on our site at your own risk, and we can’t accept liability if things go wrong.

Key things to remember when using Rest Less Money:

We do not offer financial advice – As a journalistic site, it’s important to know that we do not provide financial advice. You should always do your own research before choosing any financial product so that you can be certain it is right for you and your specific circumstances. If you are in any doubt, please seek professional financial advice from a regulated financial advisor.

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Accuracy of Information – We try to make sure that all the information provided on Rest Less Money is correct at the time of publishing as we want it to be the most helpful resource possible. Sadly, we are not perfect however, and so we can make no guarantees as to the completeness, accuracy, adequacy or suitability of the information available on the site.
Whilst we work hard to try and provide accurate information, deals and prices can change, so whilst they may be correct at the time of writing, providers may subsequently decide to alter them later – so always double check first.

A final note on the Rest Less Community Forums – always remember that anyone can post their opinion on the Rest Less Community Forums, so it can be very different from our own opinion and may not be factual or well researched. Always be wary of any content posted on the forums and be sure to do your own research and due diligence on anything suggested. 

We hope you find Rest Less Money a useful resource and we would welcome your feedback at [email protected] on how to make it even better. For more information on any of the above you can read our full terms and conditions.

Some important information about Rest Less Money

We want you to understand the positives, but also the limitations of using our site. We operate in a journalistic manner and therefore all information, guidance or suggestions provided are intended to be general in nature, and you should not rely on any of the information on the site in connection with the making of any financial decision.

When we set out to build Rest Less Money, we wanted to be a trusted place where you could find helpful information about financial matters affecting the over 50s. As a free to use resource, we try hard to provide the best information we can, but we cannot guarantee that we won’t occasionally make mistakes. So please note that you use the information on our site at your own risk, and we can’t accept liability if things go wrong.

Key things to remember when using Rest Less Money:

We do not offer financial advice – As a journalistic site, it’s important to know that we do not provide financial advice. You should always do your own research before choosing any financial product so that you can be certain it is right for you and your specific circumstances. If you are in any doubt, please seek professional financial advice from a regulated financial advisor.

No Liability – please note that you use the information on Rest Less Money at your own risk and we can’t accept liability for how you choose to use the information given on our site. We will often provide links to content or products and services available on other third-party websites. These are provided purely for your convenience and we cannot be held responsible for any content, or any of the products and services offered on any website that we link to.

 

Accuracy of Information – We try to make sure that all the information provided on Rest Less Money is correct at the time of publishing as we want it to be the most helpful resource possible. Sadly, we are not perfect however, and so we can make no guarantees as to the completeness, accuracy, adequacy or suitability of the information available on the site.
Whilst we work hard to try and provide accurate information, deals and prices can change, so whilst they may be correct at the time of writing, providers may subsequently decide to alter them later – so always double check first.

A final note on the Rest Less Community Forums – always remember that anyone can post their opinion on the Rest Less Community Forums, so it can be very different from our own opinion and may not be factual or well researched. Always be wary of any content posted on the forums and be sure to do your own research and due diligence on anything suggested. 

We hope you find Rest Less Money a useful resource and we would welcome your feedback at [email protected] on how to make it even better. For more information on any of the above you can read our full terms and conditions.

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