With households experiencing a financial squeeze due to the rising cost of living, many of us are worried about what’s ahead and how inflation will affect us financially in the future, as well as now. Here's some practical guidance to see you through.
29% of people say the impact of rising inflation over the past two years has caused them ‘a lot’ of stress and 31% say they have spent more than they can afford in the past six months (data collected in July 2023*). When times are tough, you may be thinking your Plan could be the answer to your financial worries. But your Plan is there to look after you in retirement, not the here and now. So, it's worth sticking to your Plan if you can.
Withdrawing money from your Plan to cover day-to-day expenses or make life a little more comfortable might be tempting but it could have a real impact on your future financial well-being. Take your time. And think about other ways of making ends meet before making decisions you might regret.
Any money you make from investing in your Plan is reinvested along with any additional contributions you make. The combination of regular saving and reinvesting gains gives your retirement savings the best chance of growing over time. The technical term for this is compounding. And not paying into your Plan can potentially cost you over the years. But do remember, any growth is not guaranteed, and the value of your investments can go down as well as up.
If rising costs and financial uncertainty are making your feel unsettled, we've plenty of tools to help you feel more in control.
Understand how a budget can help your financial wellbeing - now and in the future.
See what a difference a little extra can make to your retirement savings.
When you get closer to retirement, any sudden change to your environment can be worrying. It’s important to understand your Plan and your options and, if possible, speak to an authorised financial adviser.
If you want to know more about your Plan, you can find lots of information in PlanViewer in the 'Your Plan explained' section.
If you see the value of your investments go down, don't panic. Market rises and falls are a natural part of investing. A flexible approach to your retirement savings can help.
*The Fidelity Global Sentiment Survey, 2023.
The sample consisted of respondents with the following qualifying conditions: aged 20-75, either they or their partner were employed full-time or part-time and had a minimum household income of: Australia: A$45,000 annually; China: RMB 5,000 monthly; Hong Kong: HK$15,000 monthly; USA: US$20,000 annually; Canada: CA$30,000 annually; UK: £10,000 annually; Mexico: $4,500 MXN monthly; Ireland: €20,000 annually; Germany: €20,000 annually; Netherlands: €20,000 annually; France: €20,000 annually; Italy: €15,000 annually; Spain: €15,000 annually; Japan: 1.5m yen annually; Brazil: R$1,501 monthly; India: ₹55,001 annually, Singapore: SGD$2,000 monthly; Denmark: 100,00 DKK annually; South Korea: 1m KRW monthly; Switzerland: 20 CHF annually; KSA: 4,000 SAR monthly; Sweden: 180,000 SEK annually; UAE 29,000 AED monthly; The data collection, research and analysis for the above markets was completed in partnership with Opinium, a strategic insight agency. Data collection took place in July 2023. Reporting and analysis took place between July and October 2023.
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