I really am counting the days down to my retirement. This coming Friday 20th July will be my last proper day in the office.
This is followed by one more day on Thursday 26th when I am supposedly meant to chair a meeting during the morning and then handing my ICT equipment back in. I am particularly looking forward to seeing my colleagues and some external contractors at a lunchtime.
Some interesting dynamics going on. Some of my close colleagues are a little ‘quiet’ and perhaps not sure what to say. Others are intrigued at what I’ll be up to and others are expressing sheer delight for me.
One or two others still come and ask how I’ve done it. I always point out we are just an ordinary couple, we’re not multi-millionaire Lottery winners, just careful with our money.
People just don’t plan for retirement!
I have been surprised, no, SHOCKED at the lack of knowledge and awareness some colleagues have about pensions and planning for their retirement. In my last job I was near the Finance team and once I asked how many weren’t in the Local Government Pension Scheme. The percentage was quite high and the auto-enrolment scheme hadn’t improved things. The LGPS is a damn good pension but it has, regrettably, been watered down over the years. Most of mine is protected as a final salary pension but nowadays it is referred to as a defined benefits scheme. Still pretty good and hard to beat at the price.
Many colleagues don’t know about the tax advantages of additional voluntary contributions where the Government adds to the value of your investment. The Government don’t give much away these days, so this is one thing which is too good to miss.
And then for married couples, transferring some of one person’s personal tax allowance to the other is something we did. This is where my wife Rachel transferred some of her personal allowance to me as she doesn’t pay tax. It gives you a higher tax code and thus lowers the amount of tax you pay, so definitely worth doing.
It is also incredible how few people are taking steps to pay off their mortgage early. Through early repayment, it not only frees you from debt but it will work out cheaper in the long run. I suspect people normally commit the rest of their money without anything spare to pay off their mortgage. I think we paid ours off about 14 years ago – just think how much interest we have saved!
At work I don’t think I have ever heard of someone having taken proper financial advice. Sure some may have had a consultation at the Bank (hardly impartial, more of a sales job) but none have been clients of an Independent Financial Advisor and planner.
I can say this with confidence, we could never have done this without our advisor. Sure it does cost some money but it is well worth it if you are serious about planning for the future!