Did you make financial decisions in your younger days which are now having a knock-on effect on your retirement plans? What can you do about this? We examine the possibilities.
We all have regrets; a holiday we missed out on, a job we didn’t take. But what if you have regrets about your past financial decisions – or lack of them – and are worried about the knock-on effect on your retirement plans?
Maybe you fell off the property ladder, or didn’t even buy a house in the first place? Or perhaps you always planned to arrange a pension but somehow never quite got round it.
Whatever your money worries, it might help to know that you’re not alone. According to a survey carried out by Moneybox, nearly two-thirds (64%) of UK adults believe they’ve missed out on financial opportunities in life due to a lack of financial knowledge and confidence.
We can’t change the past, but we CAN control our future. So, whether you’re considering making last-minute investments to improve your financial outlook in retirement, or would prefer to learn how to enjoy retirement with the financial hand you’ve been dealt, we look into the different possibilities open to you.
Get to grips with cash flow
There are many reasons people don’t have a nest egg to fall back on when they reach retirement age; divorce, health issues, a career change. But whatever the reason, it’s never too late to take control of your finances.
“Most people who have earned enough to comfortably pay their bills throughout their working life don’t really have a proper idea how much they’ll need to earn in retirement to maintain the same lifestyle,” says independent financial adviser Serena van der Meulen. “But knowing this is the key to making sure you can continue to live the way you want to when you retire.
“Cash flow modelling – working out exactly how much you spend every month – provides a clear and detailed projection of your financial future,” Serena explains. “It analyses current and expected income, expenses, and helps people understand whether financial goals, such as a comfortable retirement, are achievable with a current financial plan.
“It also identifies potential shortfalls or surpluses which allow people to make informed decisions about adjustments to spending, saving, and investment strategies.”
If you’d like to crunch some numbers yourself, and see what your retirement finances might actually look like, try our Pension Buddy Retirement Health Checker.
It’s never too late to invest
While we know that starting your pension savings early is preferable for a comfortable retirement, you’ll be pleased to know it’s far better to start late than not at all. “There’s always time to make a difference to your retirement by redirecting your budget to a pension and other savings,” explains Serena. “A good place to start is by checking whether you qualify for a workplace pension scheme. Unlike other types of savings, this benefits from employer contributions and tax relief, enhancing the pot right from the start.
“Speak to a financial adviser to work out how much you can afford to pay into a pension over and above your minimum payments, and what options are open to you. You may be surprised by the difference it will make.”
Bring in some extra cash
If you’d like to make a bit of extra money once you retire, you’re in good company.
According to Finder.com, 43% of people in the UK earn an average of £207 a week from side hustles—that's around £900 a month, or £10,800 a year, a significant top-up to your pension.
So how do you work out what that side hustle should be?
“Finding something you love doing that you can also make money from is the obvious choice,” says Julie Begbie from the Happy Business Co.com. “Often we’re naturally good at things we enjoy but don’t even realise they could earn us extra income. I often suggest a talent-based psychometric test such as the one on ViaCharacter to discover your hidden skills.
“Once you know what you love, finding a way to make money from this passion could boost your pension, and add a lot of fun to your days.”
Reframe your expectations
If you’ve ever had a vision of retirement that involves cruising and sipping champagne, the reality could be a disappointment. But that doesn’t mean you can’t enjoy your retirement to its full: you just need to reframe your expectations.
“Financial regret can weigh heavily on us, especially as we approach retirement age,” explains Catherine Morgan, financial psychologist and author of It’s Not About the Money.
“However, the real challenge isn't just financial - it's emotional. The key to being content with the retirement you can afford lies in separating your self-worth from your net worth. Research from the Harvard Study of Adult Development, which tracked participants for over 80 years, consistently shows that happiness in later life isn't correlated with wealth, but rather with the quality of our relationships and sense of purpose.
“To reframe retirement expectations without feeling like you've let yourself down, start by
identifying what truly matters to you. Often, we inherit societal scripts about what retirement should look like - cruises, second homes, luxury travel - without questioning if these align with our personal values.
“Instead of viewing a more modest retirement as a failure, see it as an opportunity to focus on what brings genuine fulfilment. This might mean cultivating meaningful local community connections, pursuing passion projects, or finding creative ways to travel on a budget.”
Focus on the positives
The most powerful shift comes from moving from a mindset of scarcity (‘I don't have
Enough’) to one of sufficiency (‘I have what I need’), says Catherine. “Research from positive psychology suggests that practising gratitude for what we can afford, rather than focusing on what we can't, significantly increases life satisfaction.
“Consider creating a life portfolio alongside your financial portfolio - one that balances experiences, relationships, learning, and contribution to others. This broader perspective often reveals that an enriched life doesn't require a rich bank account.”
Finding the silver lining
You’ve spent years working hard so you don’t waste your retirement worrying about what might have been. These tips will help you enjoy it to the full.
Plan your finances A little bit of a forward planning now could pay dividends in retirement.
It’s never too late Don’t assume it’s too late to invest. Speak to a financial advisor.
Find a side hustle Discover ways to make extra income from something you enjoy.
Reframe your expectations Separate your sense of worth from your finances
Focus on the positives Stop worrying about what you don’t have and focus on life satisfaction.
