Managing retirement changes

Life changes when you retire – and how you spend your money might change too.

Keeping on top of your finances

Whether you’re already fully retired or have recently started this new phase of your life, it’s important to keep on top of your finances.

Regularly reviewing your budget, along with any changes to your income and expenditure will mean you’ll be better prepared to make the right decisions for your future financial planning.

If you use drawdown or investments as part of your retirement income, you’ll need to consider how much you take out, balancing between your needs today and how long your money needs to last.

What can change?

Lifestyle changes

One of the biggest changes for most people when they retire is how they spend their time. Time once spent at work is now available for leisure, family and exploring new opportunities.

Although you may lose the costs associated with work, such as commuting, you might replace those with different expenses. Retirement may mean new hobbies, travel or simply spending more time at home.

You should consider reviewing your budget regularly, as these lifestyle changes may cost much more than you anticipated.

Personal circumstances

Changes to your personal circumstances can affect how much income you have or your expenditure. For example:

  • a change in marital status
  • the death of a spouse
  • children leaving home and becoming less dependent
  • moving house - potentially incurring costs or releasing money to spend
  • paying off your mortgage - freeing up income
  • starting a new business or different type of job.

How would these changes affect your income, expenditure or who may inherit any remaining pension?

Financial change

As well as how you spend your time, there will likely be an impact on your expenditure as your lifestyle changes. At the same time your income may also be changing. For example you may see your income reduce as you finally stop work but on the other hand you may receive income from your State Pension or income from another pension.

Do these changes mean you need to alter how much money you take from your pension and investments? By increasing or reducing the amount you take, it can affect how long your money will last.


Sadly, as we get older there is a chance that our health may go downhill. A change in your health may affect how much you need to spend. For example you may need to pay for care or modifications to your home.

If your ability to make decisions over money becomes difficult, you may want to arrange a lasting power of attorney (LPA) before that happens. An LPA allows someone you trust to help with any financial decisions.

Read more about power of attorney

Your health is linked to your life expectancy. Although nobody knows exactly how long they’ll live for, it’s useful to plan for how long your money might need to last.

Read more about life expectancy

Changes to your attitude towards risk

As people age their attitude to investment risk tends to change. When you review any existing investments or pensions you may be using for retirement, you should consider whether you are still comfortable with where your money is invested.

If you find that you are less willing to take risks with your money, you may wish to consider lower-risk investments or swap to more secure investments and sources of income. However, you must remember that taking less risk may mean lower returns, reducing the potential for income or growth.

Read more about managing your pension income and any unused pensions you may still have.

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Not sure where to start?

Not sure where to start?

If you don’t know what to do about retirement or pensions, let us help. We’ll explain the basics and give you all the information you need to get started.

Retirement explained

Got a question?

Got a question?

If you need to ask us a question about pensions or retirement, then get in touch. There are lots of ways to contact us.

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