How much money will I need to retire?

 In Parkgate Blog, Pensions & Retirement Planning, Pensions and Retirement Planning, Z Our Experts View

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Are you asking yourself ‘how much money will I need to retire?’ ‘When can I afford to stop working?’ ‘Will I have enough for my later years?’

If you want certainty over how much money you will need to retire securely,  your own ‘cashflow model’ could be the answer for you.

A ‘cashflow model’ might sound complex, but we find it’s a great way of helping you to visualise your financial future and plan ahead with real confidence. All it needs is our financial planning expertise, and information from you about your money and your life aspirations.

What’s a cashflow model?

A cashflow model uses sophisticated forecasting software that creates a picture of your future financial situation. It means you can see if and how you can achieve your ambitions.

Picture your financial future

A cashflow model can also help to answer your questions, such as ‘how much should I be saving for my retirement?’, ‘how much income will I have?’ and ‘when can I afford to stop working?

We start with now

Your journey to financial certainty starts with knowing exactly where you are now. That means looking at all your savings, pensions and investment policies – including those you might have filed away. We put it all together, and ask: Is everything covered? How well is it performing? What is everything worth now, and what might it be worth in the years ahead?

Where do you want to be?

Next we look at where you want to be. That means understanding what’s important to you, both now and in the future. This is added to your model, so you can see if you are on track for the retirement you really want, if you retire at a certain age, or if you can maintain a particular quality of lifestyle once you’ve retired.

Are you on track, or are changes needed?

If you are off track, cash flow modelling can show you how much more you need to contribute, or what level of risk you might need to take to increase your returns. If on the other hand it looks like you’re on track to achieve your goals, then maybe you could take less risk with your investments, or even retire earlier than you had thought.

Consider different scenarios

While it can’t predict the future, your cashflow model allows you to create different scenarios that will help you make better informed choices, and answer your questions, such as: ‘how much more do I need to save if I want to retire three years early?’ or ‘would my loved ones be taken care of if I passed away tomorrow?’

Look at tax-efficiency too

Changes to the rules mean retirement planning is complex. As well as comparing retirement strategies, your cashflow model can look at the amount of tax you are likely to pay over the course of your retirement. It can even help you to minimise the tax you pay, perhaps by changing the order by which you draw on your different sources of retirement income.

See the whole picture

Like most people, you’ve probably built up all kinds of different savings and investments, pensions and insurance over the years. Combining these in your cashflow model simplifies your retirement plan. It enables you to see if they work together, and helps you make better informed decisions about which you should keep, which you should replace, and which you should cancel.

Regular reviews to keep your plan on track

In planning for your retirement, things change, as they always do. Retirement planning, like every aspect of your financial affairs, is an ongoing process that should always reflect changes in your personal circumstances as well as evolving legislation. Regular reviews help keep you on track and ensure you can enjoy the retirement you really want.

Sounds complicated? It doesn’t need to be.

If you want to know how much money you will need to retire, we can help with your retirement planning.

The value of pensions and investments and the income they produce can fall as well as rise. You may get back less than you invested.

Get in Touch

We offer potential clients an initial meeting at our expense, so you can decide if our service is right for you.

Arrange your meeting with one of our financial planners, to get expert advice.

Bill Ward
The founder and senior partner of Parkgate, Bill has an enviable reputation as being one of Merseyside’s leading financial advisers. Bill founded Parkgate in 1995 and has seen the business grow from strength to strength.