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Checklist for planning your retirement

You can decide to retire at any age, but to get there in tip-top financial shape takes some planning.

Whether you’re in your 20s or 60s, we have some helpful tips to help you financially prepare for the future. 

We won’t tell you how much you should be saving – everyone’s monthly budget is different. What really counts is what you choose to do with any money you’re able to put aside. 

Here’s a checklist of what you could be doing now, depending on your age. 

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Retirement planning in your 20s

Retirement planning in your 30s

Retirement planning in your 40s

Retirement planning in your 50s

Retirement planning in your 60s

Retirement planning in your 20s: the sensible starters’ decade

The 20s decade is the age of financial freedom. It’s often the time when you step onto a career path and experience the power that comes with real earning (and spending) potential. 

At this stage, retirement will probably feel a long way off. But the sooner you start saving, the better off you’ll be. 

What you could be doing in your 20s:

Start a financial action plan
 

Work out your monthly budget so you know how much money you can save.

Join your workplace pension scheme


Make sure you’re enrolled in your workplace pension scheme and make the most of any matching contributions (‘free money’) that come from your employer.

Make regular savings


Whether you save or invest, you can start today with a small amount and add to it. This way, you’ll soon be earning interest on your interest.

The 20s mantra: watch that spending and save when you can.

Retirement planning in your 30s: the serious savers’ decade

The 30s decade is all about building on what you’ve started. And if you haven’t started yet, now is the time to do it. 

Hopefully, you’ll be earning more because your salary has increased with your experience. 

Keep an eye on your outgoings, including household bills, subscription services and other expenses. Make sure you’re not spending more than you can afford.

What you could be doing in your 30s:

Add an extra 1% to your pension pot


Consider doing this every time you get a pay rise – before you even get the extra money – so you don’t miss it.

Maximise your ISA (individual savings account) allowance


You can save up to £20,000 in the current tax year and your returns will be free from UK income tax and capital gains tax. The value of these benefits will depend on your circumstances, and tax rules could change in the future.

Embrace new technology


Take a more active interest in your finances through online money management tools – or try our retirement lifestyle calculator

The 30s mantra: it’s time to stash some cash.

Retirement planning in your 40s: the powerful players’ decade

The 40s decade is an age of big earning and spending potential. All being well, you could be at the peak of your career, or supercharging it by starting your own business or stepping out in another direction. 

But if you’re not where you want to be, it’s not too late to save for your retirement. Now is the time to take a long, hard look at how you manage your money, including any debts you may have. 

You may also want to update your financial action plan

What you could be doing in your 40s:

Mind the gap


Use our retirement calculator to see whether you’re on track to achieve the lifestyle you’d want. Find out how much state pension you could get and see if you’re able to top up any gaps in your National Insurance contributions.

Consider investing


If you’re willing to take a little risk, investments – such as a ready-made portfolio – could be a great way to enhance your retirement pot. Bear in mind, the value of investments can fall as well as rise.

Set up a separate savings or investments pot


You may want to put some money aside for your family’s future or a lifelong dream you want to pursue. 

The 40s mantra: inject some extra rocket fuel into your savings plan. 

Retirement planning in your 50s: the financial-focus decade

The 50s decade is when those previously distant retirement goals start coming into sight – scarily fast. This is catch-up time where you need to focus on boosting your savings. 

Don’t be tempted to coast now just because you’re nearly there. Especially if anything major in your life has changed, like financial and emotional downturns or career and relationship shifts. 

Protect the pension pot you’re still working hard for, in case anything happens. 

What you could be doing in your 50s:

Make sure your plans are in good shape


Invest some time in improving your financial wellbeing. Make sure you have a clear picture of what you want your retirement to look like. Our retirement calculator can give you an indication of whether you’re on track.

Be savvy about the tax you’ll pay in retirement


If you have a partner and one of you is a higher-rate taxpayer and one of you is a basic-rate taxpayer, it could make financial sense to boost the basic-rate pension pot. Again, this will depend on your circumstances – and remember that tax rules could change in the future.

Consider combining your pensions


You could consolidate your pension schemes – although be aware of losing any existing benefits and any exit fees involved.

Start thinking about estate planning


Find out about how to manage your inheritance tax bill.

The 50s mantra: keep your eyes on the prize.

Retirement planning in your 60s: the live-life decade

The 60s decade is not an age where one life stops, and another begins. It’s a gradual transition – one that you should be in control of. 

If you plan well, retirement can be a time of freedom and adventure where you can put your goals into action. 

What you could be doing in your 60s:

Create a budget


Calculate whether your means meet your expectations by creating a budget – set out your household outgoings as well as more desirable expenses (from holidays and hobbies to birthdays and events).

Feel free to keep on working


More and more people are enjoying ‘semi-retirement’ as the best of both worlds. It can keep you physically and mentally active while also giving the all-important social element that work can bring. 

Live your best life, in later life


Think about what you’d like to do when you retire to give yourself something to look forward to. Perhaps it’s spending more time with family, travelling, a DIY project or learning a language – now is the time to plan for the fun stuff. 

The 60s mantra: look forward to your future. 

Go forth and share the wealth

Don’t worry, we’re not suggesting you dish out your money to everyone.

Instead, perhaps share the wealth of knowledge in this guide with someone who’s just starting out on their retirement journey. There’s a world of younger adults out there whose future selves might appreciate the nudge.