You can increase pension contributions. Clear debt. Rethink when you stop working. Build savings outside your pension. Work out what your retirement might actually cost.
And perhaps most importantly, you can start thinking about what you’re retiring to, rather than concentrating entirely on what you’re retiring from.
MoneyHelper recommends planning several years ahead precisely because it gives you time to identify a potential income shortfall and do something about it.
So if I were five years from retirement, these are the ten things I’d want to get clear on now.
Not all in one weekend.
But I’d start.
⸻
1. Decide what “retirement” actually means to me
This comes before the spreadsheet or using our planning tools and guides.
When people say they’re going to retire at 65, 67 or whenever, it sounds wonderfully precise.
- But what does retire mean?
- Stop work completely?
- Drop to three days a week?
Leave your current career but do something completely different?
Consult occasionally?
Take six months off and decide later?
There isn’t a rule saying you have to go from working full-time on Friday to permanently retired on Monday.
In fact, phased retirement can sometimes make the financial and psychological transition considerably easier. MoneyHelper notes that some people choose to draw part of their pension while reducing their hours or continue working while receiving pension income.
I’d therefore start with a blank piece of paper and write:
- My ideal retirement date:
- My earliest realistic date:
- Would I work part time?
- Would I like to do some paid work afterwards?
- What would make me retire earlier?
- What would make me stay longer?
You don’t need definitive answers.
You’re creating a direction.
⸻
2. I’d find every pension I have
It sounds obvious right.
Yet after 30 or 40 years of working, pensions have a habit of becoming scattered around.
There might be your current workplace pension, previous employer schemes, personal pensions, an old defined benefit or final salary pension and perhaps something from a job you’d almost forgotten about.
I’d make a simple pension inventory. There is also our free retirement planner (lite) which is a great tool for this and more in depth.
|
Pension |
Type |
Current value/income |
Expected retirement age |
|---|---|---|---|
|
Current employer |
DC/DB |
£_____ |
_____ |
|
Previous employer |
DC/DB |
£_____ |
_____ |
|
Personal pension |
DC |
£_____ |
_____ |
|
Other |
£_____ |
_____ |
For defined contribution pensions, I’d find out the current value, charges, investment strategy and projected retirement value.
For defined benefit pensions, I’d want to know the expected annual income, normal pension age, whether it increases with inflation and what happens if I take it early.
MoneyHelper recommends checking pension statements regularly; these normally show what a pension is currently worth, its estimated retirement income and the retirement age the provider is using for its projections.
And if I’d lost track of an old pension, I’d find it now rather than waiting until I’m about to retire.
One caution here: I wouldn’t automatically consolidate everything just because having one pension looks tidier.
Older pensions can contain valuable guarantees or benefits that may be lost on transfer.
Tidier isn’t necessarily better.
3. Check your State Pension properly
Not guess.
Not assume.
Actually check it.
The government’s State Pension forecast tells you:
- how much State Pension you could receive
- when you can receive it
- whether you may be able to increase it
- and, where applicable, how gaps might be filled.
That’s important because your State Pension age isn’t necessarily your retirement age.
You can retire whenever you can afford to, but your State Pension doesn’t start until you reach the applicable State Pension age and claim it. The government provides a personalised service for checking that age.
That can create an important planning gap.
Suppose you want to stop work at 62 but your State Pension won’t start until 67.
You’ve got five years where your private pensions, savings, investments or other income need to do more of the heavy lifting.
I’d want to know about that gap now.
4. Work out what my retirement life might actually cost
This is where retirement planning becomes real.
Don’t start by asking:
“Is £500,000 enough?”
Start with:
“Enough for what?”
In our previous GoodLifeBetter article, How Much Do You Really Need to Retire Comfortably in the UK in 2026?, we looked at the latest Retirement Living Standards.
They’re useful benchmarks.
But I’d also build my own retirement budget.
Start with what you spend today.
Then change it.
Costs that might fall
- Commuting
- Work clothes
- Work lunches
- Pension contributions
- Mortgage payments, if cleared
- Other employment related expenses
Costs that might rise
- Heating and electricity
- Hobbies
- Days out
- Eating out
- Travel
- Home maintenance
- Healthcare or care
- Helping family
And don’t underestimate one surprisingly expensive retirement asset:
TIME
When you’re working, Monday to Friday consumes a large part of your week.
Once you’re retired, there’s suddenly a lot more opportunity to go somewhere, eat somewhere, book something or start a new hobby.
MoneyHelper similarly recommends building a retirement budget that includes regular bills, travel and one-off expenses rather than simply applying a percentage to your current salary.
I’d create three numbers:
- Essential retirement what we need.
- Good retirement how we’d realistically like to live.
- Great retirement the version with more travel, experiences and freedom.
Now you have something meaningful to plan towards.
5. Work out where my retirement income will actually come from
Most of us spend our working lives with one fairly predictable arrangement.
Work → salary → bank account.
Retirement can be messier.
Income might come from several places:
- State Pension
- Defined benefit pensions
- Defined contribution pensions
- Savings
- ISAs and investments
- Property or rental income
- Part-time work
- Other assets
And they may start at completely different times.
I’d create a simple retirement income timeline.
Age 62
Work stops.
Age 62-65
Savings + private pension.
Age 65
Defined benefit pension begins.
Age 67
State Pension begins.
Suddenly something that felt complicated becomes much easier to understand.
This is also where I’d stop obsessing about the headline value of my pension pot.
A £600,000 pension sounds impressive.
But what matters is the income and lifestyle all your resources can sustainably support over what could be several decades.
MoneyHelper specifically warns that people can underestimate how long retirement might last and suggests allowing some margin beyond expected longevity when planning.
You aren’t planning for retirement day.
You’re potentially planning for retirement decades.
6. See whether these numbers actually meet
Now I’d put the two sides together.
What will the retirement we want cost?
against
What income are we currently on track to receive?
Perhaps the lifestyle you want costs £40,000 a year.
Eventually your State Pension and defined benefit pensions provide £22,000.
That leaves:
£18,000 a year to find.
That’s far more useful than saying:
“I’ve got £X in my pension. I think that’s probably enough.”
And if there’s a gap?
Good.
Not that there’s a gap, obviously.
But that you’ve discovered it five years before retirement rather than five months afterwards.
Because now there are options.
7. Use these five years while they’re still available
Five years can make a meaningful difference.
If the numbers aren’t quite where I’d like them, I’d investigate whether I could:
- increase pension contributions
- use salary sacrifice where available and appropriate
- take advantage of additional employer matching
- make sure I’m receiving the pension tax relief I’m entitled to
- build accessible savings outside pensions
- clear expensive debt
- retire slightly later
- phase retirement rather than stopping completely.
MoneyHelper specifically identifies increased pension contributions, employer matching, checking tax relief, improving State Pension entitlement and delaying retirement as potential ways of improving retirement income.
There is an important point here, though.
Don’t blindly throw every available pound into a pension.
You may also need accessible cash before pension income begins, an emergency reserve and money for major expenditure.
Tax rules and pension allowances matter too.
The right balance is personal, and this is one of the areas where regulated financial advice can be valuable.
But the underlying principle is simple:
Your final working years are still part of your retirement plan.
Use them.
8. Look at debt and the house
For many households, the mortgage is one of the largest monthly expenses.
So I’d want a clear answer to:
Will the mortgage be gone when I retire?
If not:
- How much will remain?
- What’s the monthly payment?
- When will it end?
- Do I actually want to pay it off before retirement?
Then I’d look at other borrowing.
Credit cards, loans, car finance and other debt can look very different when they’re being serviced from pension income rather than a salary.
MoneyHelper recommends considering whether debts such as mortgages, loans and credit cards can be cleared before retirement because servicing them afterwards can affect how comfortable retirement is.
Then there’s the bigger question.
Is this still the right house?
You might absolutely love it and intend to stay there forever.
Fine.
But five years out is a good time to at least think about:
- Size.
- Running costs.
- Maintenance.
- Garden.
- Stairs.
- Transport.
- Family.
- Healthcare.
- Community.
I’m not suggesting everyone should downsize the moment they retire.
Far from it.
I’d simply rather think about those things at 60 than be forced to think about them at 80.
9. Understand how you are actually going to take your pension
This is one of those decisions that’s easy to postpone because it feels technical.
Then retirement arrives.
If you have a defined contribution pension, there may be several ways of taking the money, including pension drawdown, buying an annuity, taking lump sums or combining approaches.
MoneyHelper notes that you can normally take up to 25% tax-free, subject to applicable limits and rules, but taking money from a pension can affect both the amount left to provide future income and your tax position.
I’d also check something that’s surprisingly easy to overlook:
How is my pension currently invested?
Some workplace pensions automatically move investments towards assets considered less volatile as you approach the scheme’s assumed retirement date.
That can make sense if you’re planning to take the pension in the way the scheme expects.
But if you’re going to leave much of the pension invested and use drawdown for another 20 or 30 years, your intended strategy may be different. MoneyHelper specifically recommends reviewing this where your actual retirement plans differ from the assumptions built into your pension.
This isn’t something I’d casually change myself after watching three YouTube videos.
It’s something I’d understand.
And before making major pension decisions, I’d consider regulated financial advice.
If you’re 50 or over and have a UK defined contribution pension, Pension Wise also provides free, impartial government-backed guidance about your pension options.
And I’d be extremely wary of anybody unexpectedly offering to unlock, transfer or dramatically improve my pension. The FCA warns that pension scams commonly involve guaranteed returns, pressure selling and unusual or unregulated investments.
Five years from retirement is exactly when your pension starts looking particularly interesting to scammers too.
10. Finally, plan your life not just your pension
This is the one I’d spend more time on than most retirement checklists suggest.
You’ve worked out:
- when you can retire
- what you’ll spend
- what income you’ll have
- what happens to the mortgage
- how your pension might work
Excellent.
Now it’s Monday morning.
You don’t have to go to work.
What are you going to do?
Not on the retirement holiday you’ve been planning.
Not on Christmas Day.
An ordinary Tuesday in February.
For decades, work provides structure almost without us noticing.
- There’s somewhere to go.
- People to talk to.
- Problems to solve.
- Deadlines.
- Responsibility.
- Status.
- Routine.
Then one day, much of it disappears.
That can be wonderfully liberating.
But freedom works better when there’s something you want to do with it.
So I’d start experimenting before retirement.
If I think I’ll walk more when I retire, I’d start walking now.
If I want to travel, I’d start building the list.
If I’ve always wanted to learn photography, play guitar, volunteer, write something, grow vegetables, learn Italian, build an app or climb mountains…
Why wait for a leaving card?
I’d also talk to your partner.
Their version of retirement might be surprisingly different from yours.
One person may be imagining three months touring Europe.
The other may be imagining grandchildren twice a week and finally getting the garden sorted.
That’s a conversation worth having before either version becomes an assumption.
The five-year retirement check
If you’re roughly five years away, I’d want to be able to answer these ten questions:
- 1. When do I actually want to retire?
- 2. What pensions do I have?
- 3. What State Pension am I likely to receive and when?
- 4. How much will the retirement I want actually cost?
- 5. Where will my retirement income come from?
- 6. Is there a gap between income and spending?
- 7. What can I realistically improve over the next five years?
- 8. What will happen to my mortgage, debts and home?
- 9. How am I likely to take my pensions?
- 10. What am I actually going to do with my time?
You don’t need perfect answers to all ten today.
But five years from retirement, you would want the questions firmly on the table.
Don’t aim for a perfect retirement plan
- Things will change.
- Markets will move.
- Tax rules will change.
- Your health might change.
- Your job might change.
- Your family certainly won’t stand still.
And what sounds like your dream retirement at 58 may look quite different at 63.
That’s okay.
A useful retirement plan isn’t a prediction of exactly what will happen.
It’s a framework that gives you choices.
Five years out, that’s the real opportunity.
You still have earnings.
You still have time.
You still have the ability to change course.
And you have something else that’s surprisingly valuable:
time to practise the life you’re planning to retire into.
So don’t spend the next five years simply counting down the number of Mondays left at work.
- Use them.
- Get the finances clearer.
- Get healthier if you can.
- Talk to your partner.
- Try things.
- Make plans.
- Change plans.
And gradually start building a life that doesn’t require work to hold it together.
Because the best retirement plan shouldn’t just answer:
“When can I afford to stop working?”
It should eventually answer something much better:
“What do I want to do next?”
Start with where you are today
You don’t need to solve all ten questions at once.
GoodLifeBetter’s free Retirement Readiness Assessment is designed to help you take stock of the bigger picture not just your pension, but your finances, lifestyle, health, purpose and plans for what comes next.
Five years is enough time to make a difference. Start with one thing.
