‘Never too early’ for retirement planning – top ways to retire before state pension age – Express

Pension: Expert advises people to ‘start sooner’

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Speaking to Express.co.uk, James Norton, Head of Financial Planners at investment company Vanguard shared his suggestions on how those in their 40s and 50s can begin their own retirement plans.

Through his time with Vanguard, Mr Norton is able to determine the crucial elements Britons need to consider before they retire.

Set goals

He emphasised why it is important that people set out specific goals that they want to reach ahead of leaving working life ahead of schedule.

He said: “It’s never too early (or late) to take action on retirement planning.

“And whether you’re deciding to retire early or not, it’s always key to set and prioritise your goals for when you do.

“These goals tend to fall into four categories: basic living expenses such as food and clothing, contingency reserves for things such as home repairs, discretionary spending for your holidays and leisure activities, and legacy – do you want to leave an inheritance for your family?

“It’s important to differentiate your ‘wishes’ from ‘needs’ – keep in mind that you may have to give up some of your lower-priority goals.

READ MORE: DWP addresses why state pensioners cannot claim PIP payments

Couple at lake

Early retirement: Top tips for retiring early (Image: GETTY)

“When setting your retirement goals, you should take account of the risks involved in achieving them, and make sure you’re comfortable with them.

“These risks can range from market performance to your personal health – you may end up living longer than you think.”

Analyse potential risks

For Mr Norton, risk assessment is crucial before laying out any future retirement plans.


He shared: “Life is full of unexpected events, and some come with financial consequences. Remember that in most cases, mitigating certain risks may actually increase different ones.

“For instance, purchasing an annuity increases guaranteed income, but decreases your liquid investments that could help pay for unexpected expenses in the near term.

“Once you’ve established your goals and the risks involved, it’s time to work out what financial resources you will need to help you meet these goals and provide support in a worst-case scenario.

“These retirement resources could include assets such as bonds or shares, your salary, pensions or cash savings.”

Family playing

Early retirement: James Norton gives advice (Image: GETTY)

Take advantage of support

According to Mr Norton, a major factor which will assist in helping an individual retire early is whether or not they use the tax-free allowances on offer, including pensions and ISA.

Currently, the state pension age in the UK for both men and women is 66, which is scheduled to rise to 67 between 2026 and 2028, with further changes planned.

He explained: “Investors also need to ensure they are using their tax-free allowances as effectively as possible. The Government wants us to save which is why we have pensions and ISAs, but are you using them to their full potential?

“Unused pension relief can be carried forward for three years which is a good boost for those who can afford to top up their plans, and ISAs should form a key part of retirement savings for those who are already fully funding their pensions.

“Costs are another key consideration for investors. We cannot control what the stock market returns, but we can control the costs we pay.

“High costs simply mean that your investments need to work harder to break even, so ensure that you are buying low cost funds on a low cost platform.”

Ultimately, the financial planning expert cautions that the goal of early retirement is a difficult one to attain but can be achieved through hard work and sensible behaviour.

He said: “Remember that everyone’s circumstances are unique, so it’s important to customise and adjust your plan accordingly.

“It’s important to note that chasing returns to try and enable early retirement is not always the answer – risky behaviour puts your retirement at risk.

“If at any point you realise that you need more resources, your options really are to either save more or work longer – there are no silver bullets.”