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Saving For Retirement


Saving for your retirement can be a daunting thought and trying to ensure that you have the lifestyle you wish for in your latter years can be difficult to envisage. In general the earlier you start to save the better chance of achieving the wishes for retirement you may have.

For example to achieve an income on retirement of £10,000 per year a male aged 30 would have to save approx £150 per month, however a male aged 40 would have to save approx £290 per month to achieve the same income. The most efficient way to save is with a pension fund, this is tax efficient and only can be accessed when you attain the age of 55 or above.

All workers between the ages of 22 and the state pension age, currently 67, should be offered a workplace pension if they earn at least £10,000 per year. Most employers contribute between 3%-10% of your annual earnings and ideally your contributions should top this up to 15% of your total annual earnings.

Personal pensions are a good way to top up your workplace pension, there are many providers and information can be obtained from independent advisors on which ones will best suit your personal circumstances. Personal pension contributions can be made monthly or by a lump sum and the amount you pay in can be altered as your circumstances change, such as wage increases or new additions to your family. ISAs are another saving tool that you may use, these have the added advantage of being free of income tax and capital gains tax. Current allowances allow you to invest £15240 and there is a limit of £11,000 profit that will not attract capital gains tax. There are many providers of ISAs and again independent advice is essential before investing.

Another area that has become popular in the recent past has been investing in property, generally this should yield between 3%-5% per year, however it is always worth considering that there is no guarantee of this as we all know that prices can go up as well as down. Letting property should bring in an annual yield of 5%-6% so can give a steady income for your retirement, however, there are costs that need to be factored in such as any mortgage costs, agency fees, safety certificate fees, maintenance, insurance and income tax. With the increased costs of housing for first time buyers the letting market is very buoyant at this time with many opting to rent rather than buy.

Another area that has become more popular in recent times is the antique market where investors try to purchase items that they feel will increase in value and add to their retirement pot. This can be quite risky as there are no safety nets such as the Financial Conduct Authority and there are some unscrupulous dealers around. However , if you feel that this could be for you there are a few rules to follow. Always buy from established dealers, these dealers rely on their reputation to succeed and are unlikely to sell you a fake piece and will provide you with all the information you may need.

Buy something that you like, remember you may have to keep the piece for a number of years to realise its full market potential.

Look for untouched furniture, be wary of restoration as this effect resale value considerably. It is also better to look for small useful pieces , these will stand the test of time and will have a much larger appeal. Pieces such as small Regency or Georgian desks or sets of drawers are always a good investment especially win early walnut with good colour and patina.

Glassware can be a good investment as long as it is not damaged , over worn or over polished. Look for pre-war Lalique. Larger items from the 19th century through to the Art Deco period provide good investment returns. If jewelry is attractive to you keep your eyes open for the major designers such as Cartier, Van Cleef or Tiffany as these are always popular and can again provide good
return on investments.

If investing in antiques remember to think about auction costs when reselling as these can be quite high in some auction houses. Also make sure that you are adequately insured for all your items, this again can be quite costly so needs to be considered if you wish to invest in antiques.

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