Making The Most of Our Money in Retirement

In later life, and particularly in retirement, many people have concerns about their finances. Most of us will be on a fixed income and there will probably be limited opportunities to materially increase that income through work. (Although, if you have a look at our Guide to Part-time Work in Retirement you may find help there if you want to find some work). So for many people, the focus on finance in retirement is to make the most of our money. At the moment, what with the 'credit crunch' the recession and financial uncertainty in general, this is becoming increasingly important.

Concerns about finance can affect our whole outlook to later life, so sorting out our finances is very important both psychologically as well as practically. First of all we have to ensure that we can make ends meet. When we are confident that we can do that, then we can think about how to go about enjoying our later life as far as possible. Making the most of our money will help us to do that.

There are a number of things that we can and, in some cases, should do in order to help this process:

• Analyse our finances so that we know exactly how much we have coming in and going out on a regular basis
• Get some financial help
• Put it where it is going to work hardest for us
• Spend it wisely on the everyday necessities so that we have more to do with as we wish

As we get older, and particularly in retirement, the ideal financial circumstances are low inflation and high interest rates. If we have any sort of pension, be it a company or state one, if inflation is high our pension will not keep up with the increase in the cost of living. Assuming that we have no mortgage in our later years, we want our money to make money for us. Hence our wish for low inflation and high interest rates. The problem is that the two are, by and large, linked, so we get high interest rates when inflation starts to rise ands vice-versa.

Currently, we have low inflation, which is good, (although it's predicted to rise again as we come out of the current recession), but also very low interest rates, which is not good. So we need to make the most of our money so that it will go as far as possible.

That phrase, 'Make the most of our money' is key in later life and most people want to do it for one or more of three reasons:

• In order to make ends meet
• So that they can put a little bit away for a 'rainy day', for example if inflation does start getting higher again and the pension can't keep pace with it
• So that they have a bit more to spend on enjoying later life rather than just surviving.
• So that we can make better and more wide-ranging choices in retirement (see the page 'Analysing our Finances')

This Guide is to help you make the most of your money and to provide some help with your personal finances so that you will be able to make the most of your money so that you have more to spend or save as you want.

So click one of the links in the box and start the laterlife Guide to Making the Most of our Money.