This vlog: Planning for university and retiring sooner demonstrates the situation of our model couple Andy and Sarah, both now aged 49 and who have a 17-year old daughter who is thinking about going to university and a 13-year son who will most likely do the same.

They have approached RL Wealth for a mid-life review and to see what their options are in regard to retiring a little earlier than planned.

Recently Andy and Sarah received some inheritance, which has gone into their savings, but they both want to ensure they are on track with their pensions and wondered whether they could push their retirement age back from 65 to 60 and explore what they might need to do to make this happen.

This vlog shows that if Andy and Sarah want to retire at 60, they will have to use a mixture of their pension and cash savings. However, the financial planning software shows that by the age of 70 they would run out of money, so, we model what they can do now to prepare for this so they can maintain their lifestyle a little longer.

We show them that if they use an affordable amount of surplus money from their salaries to increase their pension contributions (Andy from 5% to 9% and Sarah from 5% to 7%) and work until they are 62 rather than 60 this allows them to have a comfortable life up until their 80s. The rise in pension contribution also has great benefits for Andy who is a higher rate taxpayer.

This will be reviewed on an annual basis to ensure everything is still on track and make any amendments.

Key takeaways are:

1. It’s never too early to review your plans.
2. Make sure you review your life insurances/protection plans regularly too to ensure that they cover the “What If’s”. Depending on your circumstances you may need more or even less.
3. Make sure your savings are working as hard as they can – to at least maintain inflation protection. Difficult now but in “normal” years less so.
4. Are you using your surplus income in a way that gives you choices later on? “Pay yourself first”.
5. Look at how you can consider mitigating your tax, particularly as a higher rate taxpayer – pension contributions may be worth a look.
6. Be honest and realistic about your spending.
7. Regularly check the level of risk you are taking with your investments.
8. Have regular reviews to ensure that you are still on track!

View this Vlog here 

If you would like to arrange a midlife review of your finances, Robson Laidler Wealth would be happy to do so. For more information contact RL Wealth or email Amanda Cowie: