7 practical tips that could help Generation X feel more confident about their retirement

A man reading on a laptop.

As Generation X starts to retire, research has found that many don’t feel confident about their financial future. If you’re worried about how secure your life will be once you stop working, there may be some practical steps you could take.

According to a survey from Just Group, 52% of Generation X say they are not confident that they will have enough saved for a good standard of living after work.

It’s not surprising that Generation X isn’t feeling confident about retirement – many are supporting other generations. 3 in 10 are providing financial support to adult children, while around 1 in 10 are helping elderly relatives.

So, you might not only be worrying about your circumstances but those of your loved ones. Supporting others financially could mean you’re neglecting your long-term financial wellbeing too.

If you’re nearing retirement, here are seven practical tips that could help you feel more confident about the future.

1. Understand what your income needs in retirement will be

There isn’t a one-size-fits-all answer when calculating how much you need to save for retirement. If you haven’t already taken a closer look at your income needs, doing so now could help you feel more confident. Sometimes the uncertainty can be more worrisome than the answer.

You might find you’ve put enough away to secure the retirement you want. On the other hand, if you find there’s a shortfall, you’re now in a better position to adjust your retirement plan or take steps to bridge the gap.

It can be difficult to take your annual income needs and understand how this relates to your pension or other assets. Working with a financial planner could be useful if you’re struggling to see how you could use a lump sum to create a regular income.

2. Review all your sources of retirement income

While your pension is likely to be your main source of income in retirement, it probably won’t be your only one.

You may receive a State Pension in your later years. For the 2024/25 tax year, the full new State Pension is more than £11,500 a year. This may not be enough to fund the retirement lifestyle you want alone, but it could provide a useful foundation to build on.

In addition, you might have other assets that you could use to create an income, such as savings, investments, or property.

So, if you’re worried you aren’t saving enough for retirement when reviewing your pension, a comprehensive financial plan could put your mind at ease.

3. Take steps to reduce debt

Taking steps to reduce outgoings by paying off debt ahead of your retirement could be useful.

Not only does it mean you may be financially secure with a lower income in retirement, but making overpayments could reduce the amount of interest you pay to service the debt.

With mortgage or rental repayments often being one of the largest bills households face, paying off a mortgage before you retire could be beneficial. Indeed, the Just Group survey found that homeowners are significantly more confident that they will achieve a good standard of living in retirement.

4. Check how your pension is invested

Usually, the money you pay into a pension is invested. Over the long term, potential investment returns may help your pension grow. As a result, checking your pension is invested in a way that’s appropriate for you could be valuable.

Typically, you’ll be able to choose from several different funds when deciding how your pension is invested. These funds will have different risk profiles and criteria, so you could choose one that’s right for your needs. If you haven’t selected a fund, your money will often be invested through the default option, which might not be right for you.

Keep in mind that investment returns cannot be guaranteed and investing carries risk. It’s important you choose a level of risk you’re comfortable with and that reflects your financial circumstances, as well as your retirement plans.

5. Make sure you’re claiming all the pension tax relief you’re entitled to

To encourage people to save for retirement, the government provides pension tax relief. This means some of the money you’ve paid in tax is added to your pension. As a result, a pension is a tax-efficient way to save for retirement.

Pension providers will usually claim tax relief at the basic rate on your behalf. However, if you’re a higher- or additional-rate taxpayer, you’ll need to fill in a self-assessment tax return to claim the full amount you’re entitled to.

6. Increase your pension contributions

If you find there is a gap between the value of your pension and the amount you need to live the retirement lifestyle you want, one of the most obvious options is to increase your pension contributions if you’re able to.

Even a small, regular boost can really add up. Your contributions will usually benefit from tax relief and, as the money is invested, it has the potential to grow during your working life. As investment returns will then be invested themselves, you could benefit from the effect of compounding.

In some cases, your employer may also increase the pension contributions they make on your behalf.

7. Book a meeting with a financial planner

It’s never too soon, or too late, to start working with a financial planner to create a tailored retirement plan. Whether you’re hoping to retire in the coming year or it’s still more than a decade away, a comprehensive financial plan could help you step into retirement feeling more secure and confident.

We could work with you to create a retirement plan that considers your goals and circumstances. Please contact us to arrange a meeting.

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.

Guide: 10 things you can learn about your financial plan from these ABBA hits

In April 1974, a Swedish foursome took to the stage at the Eurovision Song Contest. Performing eighth on the night, ABBA introduced themselves to a global audience, romping to victory with their hit ‘Waterloo’.

In the intervening five decades ABBA – made up of Agnetha Fältskog, Anni-Frid Lyngstad, Björn Ulvaeus, and Benny Andersson – has become one of the world’s best-selling and most enduring artists.

To celebrate five decades of fantastic Swedish pop, this guide looks at what you can learn about managing your money from 10 iconic ABBA songs. From focusing on your long-term goals so you can have the “time of your life” to the importance of balancing risk when you “take a chance” on investing, you might be surprised at the lessons you could learn.

Download ‘10 things you can learn about your financial plan from these ABBA hits’ now to find out more about ABBA and what their catchy lyrics could teach you about managing your finances.

If you’d like to arrange a meeting with us to talk about your financial plan, please get in touch.

Working habits from around the world that could transform your work-life balance

A man pinching the bridge of his nose at work.

Does your job cause you stress? A recent survey found that 3 in 5 UK employees say their mental health declined in 2023 because of workplace stress. Long work hours, tight deadlines, and job insecurity all contributed to this burden, and nearly half of respondents said senior management was to blame.

Instead of continuing to burn yourself out, you could find it beneficial to adopt some healthy working habits from around the world to help you reduce stress.

Here are four traditions from other countries that can transform your work-life balance.

1. “Right to disconnect” rules in France

France added their “right to disconnect” law to their extensive Labour Code in 2017, amid fears that advancing technology meant companies could contact their employees whenever they wished.

The goal of the law was to improve quality of life by implementing strict boundaries for when it is and isn’t acceptable for employers to contact you. Although it isn’t illegal for coworkers to get in touch with you outside of your working hours, it does ban any sanctions against you for not answering.

Especially in the era of working from home, it’s important to draw a firm line between your working hours and the rest of your day. You may want to speak to your coworkers and request they don’t contact you while you’re trying to relax, and make it clear that – unless there’s a genuine emergency – you won’t reply until your next working day.

2. Flexible working in Denmark

Flexible working hours are a standard part of Denmark’s job market. Most people work 37-hour weeks, with many leaving at 4 pm to attend to childcare needs. It is also frowned upon for employees to work overtime, and they are entitled to five weeks of paid vacation every year.

If flexible working hours would benefit you, try negotiating with your boss. These changes might be easier to make if you work from home as you don’t have to worry about commuting times, but simple changes – like offering to start work an hour earlier so you can leave at 4 pm – could give you more time to spend with your family.

3. “Inemuri” in Japan

Japan’s hard-working culture and incessant busyness have led to the popularisation of napping in public.

“Inemuri” translates as “present while sleeping”, but it’s much more than sleeping on the job. You can find people dozing off on public transport and in the street as well as at their desks, fitting in as much sleep as they can before their busy lives start up again.

Sleeping at work may be frowned upon over here, but it isn’t a sign of a poor work ethic you might imagine in Japan.

It’s common for Japanese workers to arrive first and be the last to leave the office to impress their boss, and their sleep is further depleted by time spent networking with coworkers. Proving you’re dedicated to showing up to a long meeting even though you’re exhausted is praised as a strong commitment to the company and a great work ethic in Japan.

Thanks to the difference in culture, your boss might not appreciate you napping on the job. But it’s an important reminder to take a break and ensure you’re getting seven to nine hours of sleep every night so you wake up feeling refreshed.

4. Year-long “career breaks” in Belgium

Belgium’s employment law protects people who wish to take an extended break from work for up to one year. Although your employer may pay you a reduced rate or move you onto a paid state allowance, they aren’t allowed to terminate you for taking time off and you should be able to return to your position once you’re back.

This policy is designed to promote a better work-life balance and gives people the opportunity to better themselves by travelling or studying. It also helps those who find themselves in an unexpectedly difficult situation, such as taking care of a loved one who is ill.

There aren’t any laws in the UK that would let you take a year off, but it highlights the importance of stepping away from work when you need to.

You may want to take steps to improve your finances so you’d be able to step away from work for an extended period. It could provide peace of mind that, if something should happen, you’ll have more freedom.

A Lasting Power of Attorney could offer protection at every life stage

A man riding a bike through a city.

Naming a Lasting Power of Attorney (LPA) is often associated with the elderly. But it could provide vital protection and peace of mind at every life stage.

An LPA gives someone you trust the ability to make decisions on your behalf if you’re unable to do so. When you think about the scenarios that might happen, it may be something you think you don’t need until your later years. However, ill health and accidents can occur at any stage of your life.

Without an LPA in place, it can be difficult for loved ones to act on your behalf. So, whether you’re in your 20s or 80s, naming an attorney could be a valuable way to create protection should something happen.

Your next of kin cannot automatically make decisions on your behalf

It’s a common misconception that your next of kin would be able to make decisions for you if you cannot. However, no one has the automatic right to do so, including your spouse or civil partner.

Without an LPA there may be no one to make health decisions if you’re ill or manage your financial affairs if you cannot.

Overlooking an LPA could also lead to complications if you have joint assets. For example, joint bank accounts could be frozen until your partner gains control through the courts.

If you haven’t completed an LPA, your loved ones would have to apply to the Court of Protection for a Deputyship Order. This process can be time-consuming and more costly than naming an attorney. In addition, the Court of Protection might name someone to act on your behalf that you would not choose.

A Lasting Power of Attorney can be used to cover health and financial affairs

There are two different types of LPA. Ideally, you should have both types in place – you can choose the same person or people to act on your behalf in both cases.

A health and welfare LPA will give someone you trust the ability to make decisions related to your daily routine, medical treatment, or moving into a care home. A property and financial affairs LPA will cover areas like managing your bank account or other assets, and selling your home.

An LPA is often associated with long-term illness in old age. However, they could be used to give someone the ability to make decisions for you temporarily. For example, if you were involved in an accident, your attorney might handle your affairs while you receive treatment until you’ve recovered enough to take back responsibility.

You can name more than one attorney and specify whether they must make decisions together or if they can do so separately.

Deciding who to name as your attorney may be an important decision – who do you trust to act in your best interests, and would they be willing to take on the role of attorney?

Having a conversation with your loved ones about what being an attorney would involve and your wishes could be valuable. It may give you peace of mind and provide some guidance to your attorney should you ever lose mental capacity.

If family or friends cannot fulfil the role of attorney, you could choose a professional attorney, such as a solicitor.

You cannot register an LPA if you’ve already lost mental capacity. So, if it’s a task you’ve been putting off, you may want to make it a priority.

You must register a Lasting Power of Attorney with the Office of Public Guardian

You can download the necessary forms, along with an information pack, from the Office of Public Guardian, or use the online service to start the process of naming an LPA.

Read the forms carefully. A mistake could mean your LPA is rejected and you’ll need to pay a fee to reapply.

You’ll need to sign the forms, along with your attorney, and a “certificate provider” (this is someone who confirms you understand what you’re signing and haven’t been placed under pressure to do so). Your certificate provider must be someone you’ve known well for at least two years or a professional person, like a solicitor or doctor. Some people cannot be your certificate provider, including your partner or family members.

Once you’ve completed the forms, you must register the LPA with the Office of Public Guardian, and the process can take several weeks.

Most people will need to pay a fee of £82 for registering one LPA. So, if you need to register both a financial and health LPA, the cost will be £164.

While you don’t need to engage the services of a solicitor to register an LPA, it could prevent delays and issues, particularly if your affairs are complex.

Setting up a Lasting Power of Attorney is just one way to improve your security

An LPA could protect you if you ever become too ill or injured to make decisions for yourself, but it’s just one step you can take to create security in case the unexpected happens. Depending on your life and concerns, you might want to consider taking out income protection, creating a care fund, or building a financial safety net.

A tailored financial plan could help you assess which steps could provide you with peace of mind. Please contact us to arrange a meeting.

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

How to protect financial gifts to your children from relationship breakdowns

A woman removing her wedding ring.

As younger generations face challenges reaching milestones as the cost of living soars, you might be thinking about gifting assets to improve their finances. If your beneficiary is in a relationship, you may want to consider what would happen if they split up with their partner.

A well-timed gift could have a hugely positive effect on the long-term financial security of your loved ones.

In recent years, more people are considering gifts rather than leaving all their assets as an inheritance. There are many reasons for doing so, from reducing a potential Inheritance Tax bill to helping your child get on the property ladder.

Indeed, the Great British Retirement Survey 2023 found that a tenth of Brits aged 40 and over said they’d given what they consider to be a living inheritance in the last three years. A further 16% expect to gift money during the next three years.

Whatever your reason for passing on wealth, you likely want to ensure the assets remain within your family if a relationship breaks down. There may be steps you could take to protect the gift if there is a dispute.

Loans and gifts are treated differently in family courts

First, it’s important to understand how your gift could be treated if your beneficiary divorced. The family courts define gifts and loans differently, which could affect how assets are distributed.

Gifts, where there is no expectation that you will be repaid, are usually treated as joint assets and could be divided between both parties. As a result, it could mean the gift, or a portion of it, goes to your beneficiary’s ex-partner.

A loan may be treated differently as there is an expectation that it’ll be repaid in the future. However, that doesn’t mean it’ll stay within your family. The court is likely to consider needs. For example, if you loaned your child a deposit to buy a home and they have children that will remain with their ex-partner, the court may still award the property as housing for dependent children will often take priority.

If you’ll be giving a loan to your child, it’s often a good idea to use a solicitor to make the agreement formal, rather than relying on a verbal agreement. This could protect you and be useful in the event of a relationship breakdown.

It’s not only gifts to married family members that could be affected by a relationship breakdown either. A gift to an unmarried child to act as a property deposit if they’ll be buying with a partner could also be complicated if they break up.

4 potential options to consider if you’re passing on assets to your family

1. Ask your beneficiary to consider a pre- and post-nuptial agreement

If your beneficiary is married, or planning to get married, a pre- or post-nuptial agreement could be useful. These agreements aim to make it clear what happens to assets if the couple separates.

It’s important to note that pre- or post-nuptial agreements are not automatically enforceable in the UK. However, courts should consider the arrangements, so it can be an influential document.

2. Use a declaration of trust if the gift is being used to purchase a property

When one partner is contributing more when buying a property, a declaration of trust could provide security.

The declaration of trust will make it clear how much each party is to receive if the relationship fails. For example, if you gifted your child a deposit to purchase their home, they could use the declaration of trust to ensure they’d receive a larger portion of the sale proceeds if the house is sold to reflect this.

It’s also possible to use a deed of trust to name yourself as a “tenant in common” and entitled to a share of the property.

3. Attach conditions to the gift

As mentioned above, gifts and loans are treated differently in the courts. So, attaching conditions to a gift may be useful. For instance, you may say the money is a gift but in the event of separation, it will be repaid by one or both parties.

This should be recorded in writing and it may be useful to engage the services of a solicitor.

4. Use a trust to pass on assets

Trusts may be used as a way to protect assets and ensure they stay in the family. Assets held in a trust are managed by a trustee on behalf of the beneficiary rather than simply handing over assets. In some cases, a trust could ensure assets remain with your family.

However, it’s a common misconception that a trust cannot be taken into account when assessing how to divide assets. The court might consider when the trust was set up and its purpose when assessing the couple’s assets.

You might benefit from taking both financial and legal advice if you think a trust could be the right option for you. Doing so could help you to understand the complexities and how they relate to your situation.

It may be impossible to take assets out of a trust once they’ve been transferred. So, it’s important to make sure this is the right decision for you.

Get in touch to talk about passing on assets to your loved ones

If you’re considering passing on assets to loved ones during your lifetime, we can help.

Not only could we assess your options to ensure assets stay within your family, but we could also help calculate the short- and long-term impact passing on wealth now could have on your finances to provide peace of mind.

Please get in touch to arrange a meeting.

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

The Financial Conduct Authority does not regulate trusts or estate planning.

5 handy tips that could help couples create an effective financial plan

A couple laughing together while drinking coffee.

Managing your finances effectively as a couple could provide you with peace of mind and mean you’re more likely to reach your goals. Yet, it can be difficult as you could have very different financial priorities to your partner. Read on to discover five handy tips that could help you build a financial plan that suits both of you.

1. Set shared goals you can work towards

Having shared goals you’re working towards as a couple can help ensure you’re both on the same page and understand why you’re making certain financial decisions.

For example, if you both want to retire early, you might decide to increase pension contributions. Without a reason, potentially reducing your disposable income now could be difficult to stick to.

However, with a long-term view of how cutting back now could mean you have more freedom in the future, you may find you’re in a better position to be successful.

2. Understand your partner’s attitude to money

One of the biggest challenges of managing finances with a partner is that you could have very different views about money.

Perhaps you’re a saver who feels more comfortable when you add to your emergency fund, while your partner is more likely to splurge on a treat. Or, when it comes to investing, one of you is more risk averse than the other.

Understanding your partner’s approach to managing assets and their long-term financial outlook could help you strike a balance that means you both feel confident about your finances.

3. Make your financial plan part of your conversations

Finances play a crucial role in day-to-day life and your long-term security, from managing household bills to preparing for retirement. Yet, it’s a topic many couples avoid talking about and, for some, when they do, it can cause conflict.

According to a survey from Aviva, a quarter of couples argue about money at least once a week, and 5% said they bickered about finances every day.

Making money part of your conversations could improve communication as you have more opportunities to address small disagreements before they possibly become larger issues.

4. Be clear about how you’ll manage assets together and individually

You don’t need to inform your partner of every purchase you make or share all your assets to create an effective financial plan as a couple. However, understanding and talking about how you’ll share assets and financial responsibility is often important.

Worryingly, a survey from Starling Bank found that almost a quarter of married couples and 30% of people in a committed relationship said they keep financial secrets from their partner.

Some secrets may be harmless, such as having a nest egg in case of emergency, but others could potentially negatively affect your financial security. For example, a fifth of those with a financial secret said they are hiding debt from their partner, and 16% are concealing loss of money, such as through gambling or poor investments.

Being open about money and setting out how you’ll manage assets together or individually could ensure you’re both on the same page and avoid potential conflicts related to financial secrets.

What’s important is that you find a way to manage assets in a way that suits you and your partner.

5. Arrange a meeting with a financial planner

Working with a financial planner could benefit you and your partner in many ways, from identifying potential tax breaks to setting out a plan to save for retirement. Yet, one perk you might overlook is how it could help you better manage your finances together.

Ongoing financial reviews as a couple mean that time is regularly set aside to talk about money, your goals, and financial concerns. It may mean you’re more likely to stick to your plan and provide an opportunity to update it if your circumstances change.

A financial planner may also act as a useful third party who might help you unify different objectives. By working together with a financial planner, you may create a plan that gives both of you confidence about your financial future.

If you’d like to create a financial plan with your partner, please get in touch to discuss how we could help you and arrange a meeting.

Please note:

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.