There was a time, not so long ago, when many people’s lives fell neatly into three distinct stages – they were educated, embarked upon a career and then retired. The date at which people chose to retire was generally in line with their state retirement age, meaning 60 for women and 65 for men.
Today, retirement no longer means clearing your desk on your 60th or 65th birthday and facing a future without work and the benefits that go with it.
Increasingly, people are adopting a more gradual approach to retirement and choosing to work beyond their state pension age, slowly cutting back the amount of time they spend at work, with some even choosing completely new career paths.
‘Pretirement’, the process of gradually reducing the number of hours worked, is now a widely-accepted concept which generally begins in people’s 50s and can run into their 70s. Figures from the Office for National Statistics for December 2017 to February 2018 show that just under 1.2m people over the age of 65 were in work, and for the first time, there were more than 10m people aged over 50 in employment out of a total workforce of 32.2m.
WHY PEOPLE CONTINUE TO WORK
The key reasons people adopt this approach include doing so because they enjoy the work they do, they’re fit and healthy and far too young to stop, they feel they still have something to offer their workplace, or because they need to do so to boost their retirement income.
As the nature of retirement continues to change, it’s important to have the right retirement plans in place so that you can choose the path to full retirement that suits you best. Taking financial advice in the years leading up to retirement will ensure that when the time comes, you can make the best use of your savings and pension funds and select the best retirement income solution for your circumstances.
The good news is that since 6th April you can use this year’s ISA savings allowance to put your hard-earned cash to work in a tax-efficient way. The 2018–19 allowance is a generous £20,000, and it makes sense to take advantage of this savings opportunity as soon as possible in the year, rather than risk losing your entitlement if you forget and miss the tax year end deadline.
The longer your money is in your ISA, the more opportunity for interest and growth.
If you’re planning to use your ISA allowance this tax year, it’s worth remembering that the longer your money is saved or invested, the more time it has to produce tax-free returns.
If you’re thinking of putting your ISA subscription into the stock market but are worried about volatility that stocks and shares experience, then you can always choose to make regular contributions. This approach is called ‘pound-cost averaging’ and means that you don’t have to worry about getting the timing of purchases exactly right, and there’s no need to constantly watch markets to invest at the right moment.
OVER 40% OF BUYERS STRESSED BY THE MORTGAGE PROCESS, DON’T BE ONE OF THEM
Buying a home is, as we all know, high on the list of life events that are exhilarating and stress-inducing in equal measure.
A recent industry survey1 showed that 41% of people felt stressed by the mortgage process, so here are some top tips to help you make a success of your property purchase.
MAKE SURE YOU SAVE AND SAVE
In most cases, the bigger the deposit you can put down, the lower your interest rate is likely to be. Don’t forget you’ll need to pay other charges like legal fees and survey costs too.
WORK OUT WHERE YOUR MONEY GOES
It pays to take a long hard look at your income and outgoings; any lender considering your mortgage application will expect you to be on top of your bills and to be able to afford your monthly mortgage payments. Now is the time to cut back on subscriptions you don’t use and keep a keen eye on how much you spend on things like entertainment and meals out.
CHECK YOUR CREDIT SCORE
Lenders will expect you to have a healthy credit score. A higher score usually means you are a lower risk; the more points you score the better the chances that you’ll get credit at better rates.
Getting advice will save you time, money and stress. We are on your side, have access to a wide range of mortgage deals, know the industry and can offer useful advice on all aspects of the house buying process.
We will be able to help you get an in-principle decision from a lender, which will give a seller the confidence that you are a serious purchaser.
GET TO KNOW AN ESTATE AGENT
First-time buyers with mortgage offers in place are attractive to sellers as they can proceed more quickly than another buyer who has yet to sell. Make sure that your estate agent is aware of your position, so they can pass this information on to sellers.
DON’T FORGET TO GET A SURVEY DONE
Once you’ve found somewhere you want to buy, make sure you get it checked out by a surveyor. They’ll look out for structural problems that could be expensive to remedy.
The government has committed to making the home buying and selling process quicker, cheaper and less stressful. In April, the then housing secretary Sajid Javid announced a programme of measures designed to streamline property sales.
Under the proposals, estate agents will be required to obtain professional qualifications, and the practice of gazumping, where higher offers are accepted after a sale has already been agreed, will be actively discouraged by the introduction of voluntary reservation agreements. (The existing process in Scotland already makes gazumping less likely there.)
Local authority searches will be subject to a time limit, meaning that solicitors acting for buyers should be able to obtain the information they need within 10 days. Managing agents and freeholders will be required to provide lease information for a set fee within an agreed timescale.
To ensure that buyers and sellers are better informed about the property process, a series of guides will be published that will cover the key facts about the stages involved. These will also set out pertinent questions that anyone buying or selling should ask to help ensure their property transaction proceeds smoothly.