How to set your goals and check you’re on track
Read the steps below to find out more about setting goals and checking you’re on track to reach them.
Think about what your goals are
What would you really like to do when you stop working? Carry on with life without making too many changes? Move abroad, travel, or realise a long-held ambition? Decorate, garden more, take up new hobbies?
With more free time than you’re likely to have ever had, it's useful to think about the shape of your life when you stop working so you can see how your finances can help you realise your plans.
Set yourself a financial goal
There are ways of setting a goal that is right for you:
- A recent development by the Pensions & Lifetime Savings Association has provided a way for you to set your goals that aren’t simply based on your current income or standard of living. It has been designed designed to help you picture the lifestyle you want when you stop working - a minimum, moderate or comfortable lifestyle - and gives examples of the potential cost of that lifestyle. Click here to find out more.
- The Money Advice Service pension modeller can also help you set a goal that is relevant to you and work out how much you might need to save in the future to achieve the income you want.
- On your online DC account there are tools that can help you plan for the future you want, look at the pros and cons of different options; and spot any shortages and make a plan to correct it.
Review the amount you could receive from the Scheme and the State
Your online DC account will show up-to-date information about your TPT savings, and includes tools to estimate what you could get from your TPT savings. Your latest benefit statement will also provide values and estimates at a certain date.
And to find out what you might receive from your State Pension, check your forecast here.
Find out what you are likely to get from other pension schemes
All pension schemes must provide you with a statement which gives an estimate of the income you could receive from that pension at a retirement date.
If you are no longer receiving a statement, you can track down your old pension by contacting your former employer (if it was a company pension), the pension provider, or the Pensions Tracing Service.
Consider other sources of income or savings you have and could use in retirement
These could be savings in bank accounts, ISAs, shares, property.
Your online DC account has a modeller that can help you plan for the life you want when you stop working, explore the pros and cons of different options, and spot any financial shortfall and make a plan to correct it.
Think about whether you might need to change how much you pay or make other savings in order to have the lifestyle you would like when you stop working
This isn’t a one-time event where you set a goal and that’s it – so here are a few more tips about when you might want to review your goals:
- Changes in personal circumstances such as new additions to the family, or changes to your personal relationships, health or employment, could mean that your goals will change. The savings you will need might need to go up or down depending what has changed.
- If you’ve had to dip into your savings or there have been changes in the investment market, your retirement savings may need topping up.
- Changes to regulation could affect your income when it comes to accessing your savings pot. So it‘s important that you review your goals and what you may need to do to achieve them at least once every few years.