Companies within the United Kingdom are required to enroll their workers in a defined pension scheme.

We were the first country to make it mandatory, although it has been gradual since 2012. It means 9 in 10 workers at large UK companies are now contributing to a retirement plan, with around 7 in 10 at smaller companies. The government is keen to ensure we plan for old age, and it is something that people begin to think seriously about as they approach their fifties. Will a state pension be enough? What other avenues can you take to ensure you will be okay in retirement? It is important for people to be responsible for their own financial planning, as we explored in our article ‘How Employees Can Take Control of Their Finances in 2021’ and a solid forward financial plan is part of a wider financial strategy every employee and individual should take.

A pension is an obvious method by which many plan for retirement, but they can be unpredictable as well as lucrative. The pension calculator on EQI shows how investments can go down as well as up in value so you could get back less than you put in. It is a gamble of sorts and whilst it might be a calculated risk, increasing numbers of people are also investigating alternative methods to prepare for later life. A pension is not the only route you can explore to develop a nest egg that can be relied upon, and these four options are all considered strong additions to any long-term retirement plan or portfolio.

Stocks and Shares

Playing the stock market is one method some use to develop their retirement plan, but it is not without its risks and dangers. The advisable route is to speak to a broker who will deal with the money on your behalf, rather than you having to get up to speed. There are plenty of investment opportunities out there for those with a little capital to invest, but they are not completely risk-free. Using stocks and shares is a good addition to a retirement portfolio, but cannot be relied on for risk-free revenue.

Property

Property is a great method by which to plan for your retirement, as it is a market which is almost always guaranteed to climb over a significant period, even if it experiences dips in the short-term. Indeed, an article on The Telegraph suggested that a property with an average price of £235,000 should be worth £1m if the market follows the same trends over the next 20 years as it has the last 20. There are cons to this strategy, such as the ongoing investment required in a buy-to-let property and the constant management, but you may even find a steady income from your investment now before it matures into a saleable asset when you retire.

Lifetime ISA

A lifetime ISA is usually considered a vehicle for first-time buyers to save for a deposit, but they are also a good option for retirement, too. LISAs, as they are known, can be opened by anyone aged 18 to 39, and savings can be added up until the age of 50 and incur a government bonus. Funds can be added after that, but will not get the added incentive. This is an option for someone wanting to get ahead of the curve but be aware; if the money is not used to buy a first home, then it can only be taken out after the age of 60 without relatively stiff penalties.

Part-Time Work

Saga reveals that 36% of part-time workers in the UK are over the age of 50, and the number who are 65 or over has doubled in the last six years. Working beyond retirement for some may be necessary, but it may also be a viable option for helping your pension go a little further. With many options available now for remote workers, as well as consultancy roles for professionals with years of experience, filling some of your retirement time with paid employment could be the surprise element within your retirement strategy.