Retirement Planning: A step-by-step guide for 2025
- Alex Shairp
- Sep 22
- 5 min read
Retirement may feel like a distant milestone, but the earlier you start planning, the more confident and secure your future will be. Whether you're in your 30s or approaching retirement age, having a clear strategy is essential to ensure you lifestyle, legacy, and loved ones are protected.
At Blackmount Private Wealth, we help individuals and families across Scotland and the wider UK build retirement plans tailored to their goals.
Here's a step-by-step guide to get you started with retirement planning.
1: Define your retirement goals
Ask yourself:
When do you want to retire?
What kind of lifestyle do you envision?
Will you downsize, travel, or support family financially?
Your answers will shape how much you need to save and invest.
2: Understand your sources of retirement income
In the UK, your retirement income may come from:
State Pension - currently up to £11,502 per year (2025)
Workplace Pensions - defined benefit or defined contribution schemes
Private Pensions - SIPPs or personal pension plans
Investments - ISAs, property, or other assets
Business or passive income - If applicable.
A financial adviser can help you forecast your income and identify any shortfalls.
3: Calculate how much you'll need
A common rule of thumb is that you'll need two thirds of your pre-retirement income annually. But how much you need varies based on lifestyle, health, and inflation. It is very personal.
Use tools like retirement calculators or speak to an adviser to model different scenarios.
Look at The Pensions and Lifetime Savings Association (PLSA) 'Retirement Living Standards' to gauge what you might need to spend each year in retirement.
4: Maximise tax efficiency
Tax planning is crucial:
Consider making pension contributions that attract tax relief
Use your ISA allowance (£20,000 per year) to invest for tax-free growth
Plan for Inheritance Tax if your estate exceeds £325,000.
Blackmount Private Wealth specialises in tax-efficient retirement planning to help you keep more of your money.
5: Review and consolidate your pensions
Many people have multiple pension pts from different jobs. Consolidating them can:
Reduce fees
Simplify management
Improve investment performance.
But consolidation isn't always the best move. Get professional advice before making changes to your pension.
We have a free guide to pension consolidation that you can download on our retirement planning page.
6: Consider long-term care and financial protection
Retirement planning isn't just about maximising income -- it's about financial security:
Do you have a Will and Power of Attorney in place?
Have you considered the need to pay for long-term care costs in future?
Do you have life insurance or critical illness cover?
Taking steps to protect you and your family from unexpected events can help you have a successful retirement.
7: Review your plan regularly
Your retirement plan should evolve with your life. It should be reviewed at least:
Annually
After major life events (e.g. marriage, having children, receiving inheritance, etc.)
When legislation changes.
Ready to start retirement planning?
At Blackmount Private Wealth, we offer personalised retirement planning that aligns with your values, goals, and financial situation. Whether you're just starting or refining your strategy, we're here to help.
Book a free consultation with one of our independent financial advisers today.
Remember:
The value of investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.
A pension is a long-term investment not normally accessible until 55 (57 from April 2028).
The Financial Conduct Authority (FCA) does not regulate Will writing, tax and trust advice, and certain forms of estate planning.
Financial protection policies typically have no cash in value at any time and cover will cease at the end of the term. If premiums stop, then cover will lapse.
Frequently Asked Questions about retirement planning in the UK
What is retirement planning and why is it important?
Retirement planning involves preparing your finances to support your lifestyle after you stop working. It's important to ensure you have enough income to cover living expenses, healthcare, and leisure without financial stress.
When should I start planning for retirement?
The earlier, the better. Starting in your 20s or 30s allows you to benefit from compound growth . However, it's never too late. Planning in your 40s or 50s can still make a significant difference.
How much money do I need to retire comfortably in the UK?
This depends on your lifestyle, location, and retirement goals. A common benchmark is aiming for 60-75% of your pre-retirement income annually.
Try our retirement calculator to see how you are doing
What are the main types of pensions available in the UK?
State Pension: Provided by the government based on National Insurance contributions
Workplace Pension: Set up by your employer, often using auto-enrolment.
Personal Pension: A plan set up and funded by yourself. These can be self-invested personal pensions (SIPP) for extra control and flexibility.
What's the difference between a SIPP and an annuity?
A SIPP offers flexibility and control over investments, while an annuity provides a guaranteed income for life. Many retirees use a combination of both.
Can I retire early in the UK?
Yes, but you'll need to ensure you have sufficient savings and income to last your lifetime. Understand the tax implications of using your assets for income and consider how inflation could impact you over the long-term. Most private pensions can be accessed from age 55 (rising to 57 in 2028).
How do I reduce tax in retirement?
Strategies include using ISAs for tax-free income, managing pension withdrawals efficiently, and planning for inheritance tax. A financial adviser can help tailor a tax-efficient plan.
Should I speak to a financial adviser about retirement planning?
Absolutely. A qualified adviser can help you build a personalised retirement strategy, optimise your investments, and ensure you're on track to meet your goals.
It is important to take professional advice before making any decision relating to your personal finances. Information within this blog is based on our understanding of taxation and can be subject to change in future. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK; please ask for details. We cannot assume legal liability for any errors or omissions this blog might contain. Levels and bases of, and reliefs from, taxation are those currently applying or proposed and are subject to change; their value depends on the individual circumstances of the investor.
The information contained in this blog is for information only purposes and does not constitute financial advice. The purpose of this blog is to provide technical and general guidance and it should not be interpreted as a personal recommendation or advice.
Details correct at time of writing.