Ready for retirement? It’s never too early to plan

The sooner you start planning for your retirement, the better. If you’re not quite financially ready for your golden years, let’s see how we could help you to set up your savings.

There are many online calculators that can do the heavy lifting for you when it comes to figuring out what a reasonable amount looks like, such as moneyhelper.org.uk.

If you’re planning for your retirement and want to grow your savings and avoid complex and risky options, Cash ISAs offer a simple way to save more and earn tax-free interest.

Our customers Linda and Dave Greenway, aged 72 and 74, who live in Bedfordshire, each hold £20,000 in Cash ISAs.

The couple said they enjoy earning tax-free interest in an ISA because it provides them with “certainty and peace of mind”¹, something which is particularly important to them in their current stage of life.

They also mentioned what they find beneficial about having an ISA: “We like knowing exactly where our money is and that it’s secure, without worrying about changes in value. While we’re hopeful that we won't need to withdraw from it, life can be unpredictable, and it's good to know that the money is accessible should we ever need it. The fact that we can access the funds if an emergency arises is very reassuring, as we prefer to have the flexibility to withdraw our savings if needed.”²

Linda and Dave have set aside their savings from their Cash ISAs for house renovations, home maintenance such as improvements or repairs, putting the money towards a new vehicle if needed, and for booking holidays just to enjoy their retirement.

You might be planning for household costs and even unforeseen expenses in your retirement budget, but it’s important to factor in making the most of your free time as well. After working hard, you could stretch your savings a bit further with a Cash ISA to help you afford your hobbies or start trying new things.

Perhaps you’ll begin easing into your retirement by working part-time, or continuing work that’s related to your current interests. But even if you don’t, chances are you’ll want to front-load any spending for your hobbies during your more active years, towards the start of your retirement, so it’s worth factoring that in when considering your savings options.

The earlier you plan the more you can benefit from compound interest too. Compound interest is where the interest you earn over time is added to the principal sum of your account. Whether it’s compounded monthly or annually, if you make no withdrawals, each interest payment will still be bigger than the last. The more you top up, the higher the compound interest will be, like a snowball effect.

You can choose to receive a monthly or annual interest payment on our ISAs to suit your needs, so why not take a look at our current range of ISAs? For more information, you can also visit our ISA hub.

¹ Gen X cash stashers: Nearly one in 10 have £100,000 in savings - should they invest? | This is Money

² Gen X cash stashers: Nearly one in 10 have £100,000 in savings - should they invest? | This is Money

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