Pension savers are being reminded to take advantage of the multiple options available to boost their retirement income every month “without having to work too hard”.
The cost of a “comfortable” retirement in the UK has risen from £54,500 to £59,000 a year, according to updated Retirement Living Standards by the Pensions and Lifetime Savings Association’s (PLSA).
With the cost of living crisis still ongoing, many people approaching retirement will be looking for ways to bolster their pension pot easily.
Experts are urging Britons to take advantage of high interest rates on savings accounts and track down lost pension pots.
Do you have a money story you’d like to share? Get in touch by emailing money@gbnews.uk.
Those approaching retirement are being told how they can boost their pension income
GETTY
Speaking to GB News, Rajan Lakhani, personal finance expert at smart money app Plum, urged pension savers to make sure their “money is working hard for you”.
He explained: “Interest rates are the highest they have been for 15 years, so if you have any chunks of cash in savings accounts, find out if they are getting a decent return.
“You should be looking for accounts that offer more than four per cent at least on easy access savings.
“Make sure you are making the most of your ISA allowance too, to avoid being stung by tax.”
For basic rate taxpayers, no interest is paid on savings under the £1,000 threshold. This is referred to as the personal savings allowance.
This amount is slashed to £500 for those who are in the higher rate tax bracket and reduced to zero for additional rate taxpayers.
Savers who choose to place their money in an ISA can put up to £20,000 a year away in one type of account or split the allowance across multiple.
However, those saving into a lifetime ISA can only put up to £4,000 away and £15,000 into a cash ISA account.
LATEST DEVELOPMENTS:
- 15,000 people could be £7,000 better off after 10-minute check – are you?
- Pension pots could be boosted by £16,000 via tax relief hack
- The UK counties set to be worst-affected by ‘boiler tax’ as costs hiked
Pensioners have struggled during the cost of living crisis
PAAs well as this, many workers may have forgotten their previous pension pots from old workplaces which can be recovered easily.
Mr Lakhani added: “Check your pension is working hard too. Use the Government’s lost pensions tool to track down any pensions that you might have forgotten about.
“And consider whether you might save some money by combining the different pots into one pension – this is known as pension consolidation and is a surprisingly straightforward process which can result in much lower fees overall.
“Speaking to a qualified financial advisor is a good idea if you have a lot of money in different places and want a personalised plan to make the most of your savings.”
