We’ve all got different ideas about the age at which we’d like to retire, but when it comes to that magic number, will you be able to afford it, or will you have to continue working?

Senior couple embracing on beach
(Thinkstock/PA)

With life expectancy increasing, and a rising state pension age, people face the prospect of needing to save more and/or working for longer to achieve the kind of retirement they want.

The state pension age will rise from 67 to 68 from 2037. But there are ways you can boost your chances of retiring when you want – even if there are no guarantees.

Alistair McQueen, head of savings and retirement at Aviva, says: “There is no secret silver bullet that will help us short circuit the journey to our retirement. But that does not mean we are powerless to act.”

Top tips for taking control of when you retire

1. Start early

Try to start saving at least 40 years before you want to retire. The later you leave it, the more you will need to save each month to reach your target. If you want to retire at 60, start saving at 20.

2. Save at least 12.5% of your salary towards your pension every month

Save at this level for 40 years, and you’ll have a stronger chance of securing your goal – the commonly targeted retirement income equivalent to two-thirds of your salary. Remember, this 12.5% can include money from you, your employer and the taxman.

3. The rule is 10 times your salary

Regardless of when you start saving, aim to build a pension pot of at least 10 times your salary by the time you retire.

4. Save into a workplace pension

Retire at any age Turner worker working on drill bit in a workshop

Saving into a workplace pension means your employer will also contribute. Some employers will contribute more if you save more. If you can, it often makes sense to maximise your contribution to maximise your employer’s boost.

5. Invest wisely

By investing your money, in a pension or elsewhere, your money can grow through to your target retirement date. Bear in mind, though, investments can go up and down in value.

6. Keep checking

Every year your pension provider will send you a pension statement, explaining how much you have built up. Use this information, at least once every year, to check if you are on track for your retirement target. If you are not on track, take action.

7. Use free online tools

Many pension providers now allow you to monitor the value of your pension as often as you like online. There are also many free online “retirement calculators”.

8. Careful budgeting can help maximise your savings

In simple terms, £1 saved today could potentially be worth more than £5 by the time you reach retirement if you invest sensibly over 40 years.

9. Shop around

The services and retirement incomes providers offer in return for your pension pot may likely differ. Find the best deal for you as this could make a significant difference to your income through the rest of your life.

10. Beware the pension age rising

If you’re affected by the state pension age rising from 67 to 68, you could consider saving money to help fill the £8,000 gap. To build £8,000 over 20 years you would potentially need to save about £20 every month, when investment growth is factored in.

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