Save Money retire

Published on May 10th, 2014 | by Pete

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How much should you save towards Retirement?

What is the best car you can buy? Where is the best place to visit on Holiday? Who is the best footballer to have ever lived? What is the best food I could eat?
These are all questions that don’t have a correct answer. Someone might say a Ferrari is the best car they can buy, though someone else may prefer a people carrier as they have a large family. Someone might say that a pizza is the best food, though some else may be allergic to tomatoes so would disagree.
You get the point. The answer to certain questions will differ depending on the situation of the person who is answering.

This is true of the question about how much you should save towards retirement. There is not one correct answer we can give you, as the answer will differ depending on your situation.

How much to save for retirement is such a difficult question to answer, though that hasn’t stopped people trying. If you scour the web you will find simple formulae from ‘experts’ and savings calculators that lack the depth to provide you with a truly accurate figure.

There is, however, a template that you can use to work out how much YOU should save towards retirement.

The Template

The template is made up of two points;

1. Your current position
2. The position that you want to be in when you retire

1. Your Current Position

This is fairly easy to analyse. To create a picture of your current position you need to look at your existing income and expenditure, current savings, pensions, property position, mortgage and your other assets and liabilities.

2. The position that you want to be in when you retire

This is a lot harder to analyse as it requires you to fast forward and pitch figures that could easily change. Retirement may be a long way away and your situation could change dramatically between now and then. So with this in mind, how can you really know how much money you will need in retirement?

A certain amount of guess work and assumption will help you to work out a figure and you will know your target figure for retirement.

For many individuals this may be too challenging as you will have to factor in income and tax levels, future growth rates on investments and savings, how much income can be drawn from future pension funds accumulated and much more.

A good financial adviser could help you reach a much more detailed figure. You can find financial advisers in your local area on Unbiased.co.uk (insert link) or we can help you build a plan.

To conclude, to answer the question of how much you should save towards retirement you need to map out your position from where you are now to where you want to get to, then create a plan to help you get there. Again, you should seek advice to put the best possible plan in place.

 

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One Response to How much should you save towards Retirement?

  1. Sandra Mercier says:

    That’s really interesting! Thank you for sharing! Hope to hear more from you!

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