It’s never too early to save for your retirement

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We get it, there’s a lot going on when you are starting your career. From buying your first home, to marriage, to starting a family, it’s understandable why planning for your retirement can often drop down your list of priorities.

Reap the reward of starting early

However, the earlier you start, the easier it will be to prepare for your retirement years. Every ten years you wait, may mean paying up to double to get the same pension income.

Let’s take a look at how delaying saving for your retirement may impact you:

  1. Karen and Tim would like to retire when they are aged 65
  2. Karen starts to save £200 p/month when she’s 30
  3. Tim delays saving until he is 45, meaning he will have to contribute twice as much p/month to help catch up

Not only will it be easier to save for retirement, but you can also benefit from compound growth, which simply describes the process of earning returns on your returns.

But, how much will you need?

To work out how much you’ll need when you retire, you’ll also need to consider how you want to live once you are retired: Are you happy to just have enough to just cover the essentials? Do you want to be live a more comfortable retirement? Or are you looking to live a luxurious retirement, where you might travel regularly?

There are a number of useful tools out there which can help you work out when you will be ready to retire, such as the Pension Calculator provided by Money Advice Service.

  • The information provided in this article is for guidance and educational purposes only. Police Credit Union Ltd. does not offer regulated financial advice. Please seek independent financial advice.

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