You can probably name your pension to the nearest thousand. Here’s a way to check the other seven things you’ll be living on.
Retirement planning | Pension decisions | Planning the second half of life
The second half of your life is coming whether or not you’ve decided what’s in it.
Most people I talk to can tell me what’s in their pension. Far fewer can tell me what it’s for — what shape of life it pays for, whether it works at all.
That’s not carelessness. Money is easy to count, and almost nothing else is.
The pension decisions you didn’t make
Here’s the other thing about that pension. Nearly every decision about it has already been taken. The fund it sits in. The date it assumes you’ll stop working. What your money is doing while it waits.
Someone chose all of that. It probably wasn’t you.
You may have been told your workplace pension is handled. It is handled. Just not by you — and the arrangement almost everyone ends up in is a concentrated bet dressed up as prudence.
That bet was designed for a steadier world than the one it must now pay out into. Mark Carney called it the “tragedy of horizons”: the system judges itself on the last three years, while your pension has to work for the next thirty.
I’m not telling you to abandon your pension. But financial markets are becoming too risky to rely on completely.
What else you’re retiring on
There’s a plainer point in there too. A plan resting on savings and investments alone is more concentrated than it looks. Any home you own is part of it. So is what you can still earn — and whether you’d still want to. So are several things no statement mentions.
I worked through it on my blog, in What if we invented the pension again from scratch? The short version:
Only one sends you a statement, which is why the other seven drift. Nobody has ever written to tell me my friendships are underfunded.
For each: where am I today, and where do I want to be in five years? The gap is where the thinking starts, not the score.
Your health. It compounds the way money does — start early and the return is larger. Physical, mental, social, spiritual: all four.
Your money. You know the number. The harder question is what it’s invested in, and whether that suits the world you’re retiring into. Most providers offer alternatives to the default — worth finding out what yours does.
The people around you. Before pensions existed, family and neighbours were the retirement plan. Who would you ring if something went badly wrong?
Your home. Flood risk, insurance and energy bills all feed into what a house is worth. Cutting a bill is more certain than earning it back.
What you can still earn. Not just whether you could earn, but whether you can turn what you’re good at into work you’d actually want to keep doing. That takes years to build. You track what goes into your pension — do you track what goes into you?
The natural world. We depend on it whether or not our accounts say so. Taking that seriously isn’t sentiment, it’s risk management.
Your voice. Pensions now sit inside inheritance tax, so money is harder to leave than it was. What you stand for still carries. Have you asked your children which they’d rather have?
How you decide. The one I’ve added, because it sits under the other seven. Do you have anywhere to think properly? If not, start there.
What the self-audit usually turns up
Most people score the money confidently. It’s the one we’ve all been made to practise.
Confidence isn’t the same as being on track. When I run the projection properly — with scenarios where climate risk actually shows up in the returns — a fair number of people turn out not to be funded for the retirement they’re picturing. Not because they’ve been careless, but because the projections they were shown rest on assumptions that are getting harder to defend.
The rest are less predictable, and rarely what people brace for. Someone certain their social life is fine counts up plenty of contacts and few people they’d ring at short notice. Someone who assumed they’d stopped learning finds they never did.
One is a gap; the other something you had all along and never counted. That’s the point — not the scores, but counting something you’d otherwise leave to a feeling. Do it with a pen; it’s harder to fool yourself on paper.
Doing it properly: the Planet Positive MOT
That projection is the core of it. I take the three things you can put numbers against — your money, your home, and what you can still earn — and give you a written picture of what future they actually support. The rest comes up when we talk it through.
I won’t tell you what to do. That’s the point, not a limitation — you make the decisions, better informed than you were. £200, and it comes off if you go on to coaching.
The information in this article is for educational purposes only and does not constitute financial advice. For personalised recommendations, please speak with a qualified financial professional.