How to Manage Your Wealth into Retirement

Posted on 21st April 2023

Many people look forward to retirement – it’s a time to recuperate and rest after many years spent working and climbing the career ladder.

You’ll have a lot more time on your hands, but it always means you’ll have less cash because you no longer have a regular income. Without money coming in, some retirees must rethink their lifestyles and spending habits.

This doesn’t mean you can’t enjoy your retirement and do those things you always thought you would after finishing work. It just means you have to adjust your finances. Here are some helpful tips on how you can manage your wealth into retirement:

Investing in property

Putting money into property is a solid investment that can help fund your retirement. Buy-to-let properties provide a regular, monthly income – especially when it is in a good rental location. Looking for holiday properties such as lodges for sale can be a great way to both fund your retirement as well as give you a holiday home away from home. This will of course depend on the location of your lodge and the type of contract you go into.

A property (or a property portfolio) will typically outperform pensions in terms of return, but you need to be well-versed in your tax responsibilities. You can also cash in regularly by releasing equity.

Government bonds

Compared to other types of investment, this is considered safer because they are secured by the government and they can be directly bought through your DMO, broker, or your bank. These bonds or ‘gilts’ grant a government loan at a set interest rate and a steady source of income from annual coupon payments paid by the UK Government treasury.

This is a great opportunity to diversify your investment portfolio and spread the risk over several investments, especially as you approach retirement and your investment risk tolerance isn’t as high.

Downsizing

Downsizing can help you fund the lifestyle you want for your retirement as it can free up equity locked in the house. If you’ve got plenty of space but it’s just you or a loved one remaining, then moving into a smaller property could help free up some cash. This can be used to fund any lifelong plans like moving to the coast or closer to family.

Typically, smaller properties are cheaper run due to lower council tax bands and energy bills. Maintenance and repair costs are also likely to be cheaper, especially if the home is a new build.

Moving abroad

Overseas property is a big financial investment but it’s a great way to manage your wealth. Popular destinations to buy abroad include spots in Spain, Portugal, and France because it is cheaper for Brits to live in Europe than in the UK. The lower living costs and energy prices mean your savings won’t be drained on your utilities and other everyday expenses.

Everyday necessities like groceries and toiletries are also cheaper in Europe, along with facilities like hiring painters, electricians – the lot.