Canada Life has warned of the impact of accessing pension savings before State Pension age. The analysis shows that, for example, someone taking their benefits at age 55 could have pension savings 59% lower than if they had continued to save until age 67.
It is vital that individuals are aware of the tax and cost implications of accessing their pension savings early, as more look to do so amid the cost-of-living crisis. Not only will their pot size be significantly smaller, their savings will also need to last for longer. And, bearing in mind that retirement can now last for several decades, they need to consider if they will continue to have enough income to meet their needs.
In the current climate, financial education and impartial guidance are more important than ever to assist pension savers in making informed choices. We believe that good retirement planning should start several years before an individual’s planned retirement date. Through our Aspire to Retire service, we provide support for pension scheme members from age 50 through financial education, planning tools, guidance and optional regulated financial planning advice.
If you are interested in offering Aspire to Retire to your employees, please contact your usual PS Aspire contact.