Options for a shortfall in your retirement forecast

If you are clear on when you want to retire, how much you need and how much your current pension and investment forecast you may have found you have a shortfall.

If this is the case what are your options:

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1. Save more now. This is not always possible, but if you can  increase your pension pot, you will gain two fold, with more money to invest and longer for that investment to grow.  You can contribute additional amounts to your company pension, which they may match or setup your own SIPP. Take into account that when you save you are getting tax breaks so saving more may impact your take home pay less than you think.  However balance is key, do not over extend yourself by saving more than you can afford.
   
2. Phase out work. Instead of having an age when you give up work completely gradually phase out work and work only part-time. Not only will you be able to live off your earnings, and test out working less, but you will still be contributing to your pension.
3. Using your house as equity - if you expect to have paid off your mortgage by the time you retire you could use this money to downsize and the profits you invest to contribute to your pension, have an equity release plan or rent out rooms as an income. There are many considerations and potential pitfalls.
4. Passive income - start to generate a passive income that you develop in your working years but will give you an income when you retire. There are many passive incomes like renting out properties, hosting an online course, blogs or influencer activity. Although these are termed passive incomes, they will take some time and energy.
5. Change your expectations - if you can not do any of the above you may need to work longer or reduce the amount of outgoings you have so you can live on less. If there is still a shortfall and your income is low you may be able to apply for pension credits.