Ensuring your financial plan for retirement is all it needs to be

Published:  11 Jul at 6 PM
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If you’re planning to retire overseas, making sure your financial plans are adequate is essential.

More and more older people are opting for a retirement in a warm, sunny, cheaper destination after having spent their lives working and waiting for an excuse to get up and go. For many, Brexit is that excuse, and increasing numbers of Britons are now heading for popular European expat hubs. Hopefully, the majority have made financial plans for their retirement, as the British state pension isn’t exactly generous. Nowadays, planning for retirement is taken far more seriously than ever before, but a high number of savers are short on the expertise necessary to ensure their retirement plans grow in the right direction.

In addition, over the past several decades, there’s been an explosion of so-called independent financial advisors looking to rip off uninformed, older members of the general public via cold-calling, fraudulent investments and unsuitable pension transfers. The list of retirees who’ve lost most or all of their hard-earned savings grows longer with every uncovered scam. Even if you’re savvy enough to resist approaches from the financial underworld, many factors are in play and influencing your financial plan’s final results.

Planning for the effects of inflation is important, as high inflation reduces the actual value of your investment. Building in a three per cent increase in regular savings should be enough to counter the average inflationary episodes of around two per cent. As regards borrowing money, interest rates move hand in hand with inflation, making choosing the right time to take on a debt another essential.

Expats living and working overseas need to be aware their investments are subject to many different regulations, some of which can affect the best-laid financial planning strategy. If you can find a registered, competent IFA to help you understand these variables and plan a new strategy, that’s the best way forward. Again, if you’ve investments back in the UK as a part of your retirement strategy, finding a reliable guide can save the necessity of giving away chunks of your hard-earned cash to the taxman after yet another rule change.

Setting spending and saving rules and sticking to them will determine the success of your financial retirement plan. Living within your means can, admittedly, be frustrating at times, but speedy paying off of any loans and resisting the temptation to max your card pays long-term dividends. For many, actual investing rather than simply stashing your savings in a bank account paying a derisory rate of interest is a scary prospect, with horror stories involving dodgy investments going viral on a regular basis. Again, finding a trustworthy IFA who can guide you through the maze of what’s available is the way forward, but extreme care should be taken.
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