REVIEW
When you’re in your 40s or 50s, now’s a good time to check your progress – even if retirement is still a long way off. We understand that when life gets busy, saving for retirement can easily slip down the to-do list. We put a note on the fridge to remind us, only to find it still there six months later!
CHECK YOUR PROGRESS
You might have been a member of the Plan for several years, or you might have recently joined and have other pension savings elsewhere. Whatever your situation, once you’re in your 40s and 50s, it’s well worth reviewing all your retirement savings. Give some thought to how much money you’re going to need in the future and make any adjustments now to help you achieve that, while you’ve still got plenty of time before you reach retirement.
HOW MUCH MONEY DO YOU NEED IN RETIREMENT?
If you’re finding it tricky to answer this, you’re not alone. People are living longer than ever before, and it’s quite possible that you could spend a third of your lifetime in retirement. Less than a quarter of us really understand what retirement income we need and what we should actually be saving.
Work out your expected income:
Your Cummins UK Pension Plan
Look at your benefit statement to see an illustration of how much pension you could get if you continue to save at your current rate.
Your other workplace or personal pensions
Include income from other pension arrangements you have.
Your State pension
The State pension is payable from your State pension age (66, 67 or 68).
Is this enough?
Your Cummins UK Pension Plan
Look at your benefit statement to see an illustration of how much pension you could get if you continue to save at your current rate.
Your other workplace or personal pensions
Include income from other pension arrangements you have.
Your State pension
The State pension is payable from your State pension age (66, 67 or 68).
Is this enough?
TAKE ACTION
You can check your benefit statement via Manage my pension, get a forecast of your State pension entitlement and read our news article about How much money will you need in retirement? to help you work out your expected retirement income.
There are some simple things you can do now to make a big difference later:
Increase your contributions
Increasing your regular contributions could have a big impact on your retirement income. If you aren’t already paying 7% contributions, you’re missing out on valuable Company contributions. If you do already pay maximum saver contributions, you can choose to pay additional voluntary contributions (AVCs).
Boost your savings with your variable compensation
You could add your variable compensation to your pension fund as a one-off AVC. Remember that if you take your variable compensation as income, you’ll pay tax on it but if you pay it into your pension, you won’t. This is a good way to give your pension fund a valuable boost as well as keep the full amount of your variable compensation for yourself. The deadline to do this each year is usually mid-March.
Change your target retirement age
Check that your target retirement age is still right for your plans. Changing when you stop working will have an impact on the amount that’s in your pension fund at retirement. A delay could give you the time you need to add extra contributions and more opportunity for investment growth.
To make any of these changes, log in to your account via Manage my pension.
