Top three tips... during retirement

Posted on Aug 29, 2019

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In our new series of blogs, members of our team discuss their ‘top three tips’. Here Partner, Andy Smith, reveals his top three tips to think about during retirement:

Tip one: Only drawdown what you require

Many of our clients worry that they will miss the regular income offered by a job when they retire. It is possible, though, to take income from a flexible pension drawdown and there is potential to set up a regular income to ‘drawdown’ your money. This suits many people, who feel that they will miss their monthly salary.

While we appreciate that it’s difficult to tell how much money you’ll need each month once retirement comes, it’s important not to take income from flexible pension drawdown that is not required, just because you can. Pension income is taxable and excessive withdrawals could lead to unnecessary tax being paid.

If it is not needed for regular expenditure purposes, then it is best left in the tax favourable pension environment until it is required. You should only take as income what is specifically required to meet outgoings on a monthly basis. This, of course, includes all costs including bills, food, clothes, meals out and leisure activities etc.

The drawdown option does offer flexibility and the figure you decide to drawdown monthly can be scaled up or down, as you settle into your own particular retirement routine. It can also be halted completely.

Tip two: Treat monthly expenditure and capital expenditure as separate items

It’s hard to tell exactly how much you will need each month to ‘get by’ in retirement and sometimes it can take a few months to settle into your new routine and reach an understanding of how much money you’ll need. As mentioned above, you can scale up or down what you draw down. 

It’s important, though, to understand that your regular monthly expenditure is different from capital expenditure and they should be considered as separate items. Capital spending might include what you’d spend on a new car, a holiday or home improvements and payment for those should, ideally, come out of savings, rather than your regular income. 

At The Goodman Partnership, we sit down and explain all this to our clients and help them to understand what they are budgeting for and where that money will come from. Personally, I really enjoy talking to clients about their hopes and dreams in retirement and helping them to devise a strategy for that special time in their life.

Tip three: Make memories while you can

At The Goodman Partnership we do sometimes find ourselves in the position of having to persuade our clients to enjoy their money a little. People can be naturally cautious if they’ve been used to an income for so many years and then it stops; they worry about spending their retirement funds. Generally, however, we would encourage them to take a balanced view and make a few memories if they can.

We never know what’s around the corner, so don’t put off fulfilling your plans and aspirations for travel, for instance, until it’s too late. It is important to create memories, rather than look back with regrets. Make the most of today! 

During retirement, our circumstances can change for all sorts of reasons, such as our own health or that of our family. It is therefore very important to have regular reviews of your financial arrangements to ensure you can continue to meet your life objectives. 

If you want to talk to us about your retirement plans, then do call The Goodman Partnership on tel: 01892 500600 or click here.

Partner Andy Smith joined The Goodman Partnership 20 years ago. He had been working in training with an insurance company and wanted to move into an advisory role and an opportunity came in the shape of The Goodman Partnership. 

For a while, Andy worked in a general role but in the early 2000s, the decision was made for the team to specialise. His natural bent was towards pensions and retirement planning, so it made sense for him to focus on that area and he primarily works with clients at or near to retirement. 

Andy became a Partner at The Goodman Partnership in 2000. Today, in addition to his day to day role, as a member of the management team at the firm, he is the compliance officer with responsibility for areas including anti money laundering and data protection. He also handles all communications with the firm’s regulator.



Goodman Chartered Financial Planners is a trading name of Fairstone Financial Management Ltd. Fairstone Financial Management Ltd., is authorised and regulated by the Financial Conduct Authority – FRN: 475973 Registered in England and Wales no: 05574120. Part of the Fairstone Group. Where you have a complaint or dispute with us and we are unable to resolve this to your satisfaction then we are obliged to offer you the Financial Ombudsman Service to help resolve this. Please see the following link for further details: