What is the recommended age to start saving for retirement?

“There is a whole new kind of life ahead, full of experiences just waiting to happen. Some call it ‘retirement.’ I call it ‘bliss.” – Betty Sullivan

Time is of the essence when it comes to saving. But when it comes to saving for retirement, then a number of questions pop in my mind. Have you started saving for those retirement days? “I am too young to save; I still have a few decades before I need to worry about saving for retirement.” If this is what you have been thinking? Well, read further to find out more.

Saving for retirement at any age is essential, and the earlier you start, the more you will have saved up when it is time to hang up your work boots. Retirement can be a positive step in one’s life because you’re saving for a chance to have a retirement that is the result of hard work and dedication of saving during your younger days, giving you more time to cherish those precious moments with those you love most and less time to worry about financial difficulties.

The truth is you are never too young to save; the younger you are when you start putting money aside for retirement, the more money you will have for when your retirement day comes calling. Research has indicated that the best time to start saving is when you secure your first paid employment during your 20s because most people are in the workforce by this point, which gives you a better chance of starting the saving process for retirement. However, it is also a time when individuals may have several goals that they may want to save for, such as buying a car, putting a deposit towards a house, travelling, and starting a family, making it more challenging to save.

By the time you reach your 30’s, you may have achieved some of the goal’s you had during your 20’s such as starting a family and buying yourself a car. Nevertheless, you may have more financial responsibilities, such as providing for your family, paying the mortgage, and might still be paying for university fees. Saving no matter the amount is essential; it is not too late to start saving in your 30s. If you have spare money from a promotion at work or a tax rebate that has been paid back to you from HMRC for overpayment, you can also put this extra cash away for early retirement. The state pension age has increased, which means that if you are in your 40s, you still have 28 years of State Pension entitlement, enabling you to save enough before retiring.

Types of saving options for retirement available in the UK:

  • Pensions- Are typically used as a retirement saving option; you will be required to pay money towards them but will most likely not have access to the workplace or personal pension until the age of 55
  • ISAs- can have more flexibility depending on the ISA account you decide to go for, as you may need to access funds before retirement. ISA is a tax-free method of saving. There is a range of ISA options you can pay cash ISA into and choose either an easy access account to access your account as much as required or a fixed rate ISA that has restricted access during the bond duration.
  • Lifetime ISA- Is an ISA type where you can establish a long-term fund customarily used for long term goals such as retirement, you are allowed to pay £4,000 a year, and the government will also pay 25% of what you paid into the account. The downside to this account is that you will have no access to the account until you are 60 unless you are purchasing your first home. When you turn 50, you will lose the ability to pay into the account, losing the 25% bonus, although your account will still earn interest. Lifetime ISAs are not the same as saving towards a pension.

The younger an individual is, the more difficult it can be for them to consider saving for retirement, but if you are lucky enough to live until your senior years, you will need your savings to help support the cost of living. The road to saving is not always smooth as the unexpected can happen, such as increases in unexpected bills, increases utility bills, and other changes in your circumstances that could affect your ability to save. New laws may also come into legalisation which can change the minimum pension age; if this was to happen, it would affect how early you could access your savings, but with a decent saving strategy and dedication to saving, you should be able to overcome a lot of the challenges that may arise along the way.

Intellisaving is always looking for new ways to provide innovative features that benefit every saver because they understand that every saver has a different saving need. Intellisaving has a platform where users can access all your instant access and saving accounts within their platform without tirelessly logging in to multiple bank accounts. They also have other features such as a personalised portfolio summary for every user, a market view section on the app to compare different market details, including interest rates for various banks and a watchlist that makes it easier to track accounts. As Intellisaving progresses, those saving for a pension and other savers will benefit even more from using the platform. Retirement can be fulfilling if we start saving as early as possible, one day; you could be enjoying the fruits of your hard labour while doing some of the things you did not get to do when you were younger, start saving today, and one day you could be thanking your younger self for doing so.

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