5 of the biggest retirement regrets, and how you can avoid making the same mistakes

1. Not saving enough during your working years

One of the more common regrets people share when they eventually retire is that they didn’t save enough during their working lives.

It’s easier to fall into this pitfall than you may initially think. 

During your working life, you may find you focus more on immediate priorities, such as paying off your mortgage, supporting loved ones, or managing other day-to-day expenses. 

As a result, long-term planning can slip down the list. However, your retirement may last longer than you expect. 

According to the Office for National Statistics, life expectancy at age 65 in the UK is:

• 21.2 years for women
• 18.7 years for men. 

This means you could end up spending decades in retirement, which would require a considerable pension fund to support your dream lifestyle.

Thankfully, it’s never too late to start saving, and tax relief can significantly bolster contributions. 

In 2026/27, the Annual Allowance allows you to contribute up to £60,000, or 100% of your earnings, to your pension while still benefiting from tax relief. 

This is when the government essentially “tops up” your fund, meaning a £100 contribution would only “cost”:

• £80 for basic-rate taxpayers
• £60 for higher-rate taxpayers
• £55 for additional-rate taxpayers.

Just remember that if you are a higher- or additional-rate taxpayer, you must claim your extra tax relief through your self-assessment tax return. 

Even increasing your contributions by seemingly small increments today could significantly bolster the size of your fund in the future, thanks to tax relief.

2. Waiting too long to start planning

Even though it’s never too late to start contributing more to your pension, you may regret not starting your retirement planning earlier. 

This is understandable. Even when retirement is on the horizon, it’s easy to assume you still have plenty of time to think more carefully about the future.

And you may assume that it is much easier to build a fund near the end of your career when you have more disposable income.

However, halting or pausing contributions could result in a significant shortfall later in life.

The table below shows the long-term impact of pausing contributions for someone who starts working at the age of 22 on a salary of £25,000, pays the minimum auto-enrolment contributions, and could build a total retirement pot of around £210,000 at the age of 68.

Source: Which? 

The longer your money remains invested, the more chance it has to benefit from “compounding growth”. 

This is when returns from your investments generate further returns over time. 

While returns on investments are never guaranteed, this “gains on gains” effect could significantly bolster the overall value of your pension.

3. Retiring earlier than you can afford to

You may believe that retiring as early as possible is always ideal. However, some retirees found that stepping away from work too soon placed unnecessary strain on their finances. 

Delaying retirement could give you more time to build a fund that can support your desired lifestyle for longer.

It might be worth considering a “phased retirement”. This is when you gradually scale back your hours or responsibilities, or move into part-time work or a consultancy role.

Continuing to earn an income means you might not have to dip into your pension so soon, helping your savings last longer. You could even continue contributing to your fund, with the added benefit of employer contributions, further bolstering it. 

And, if you believe you will miss the routine and social experience of work, continuing in some capacity means you retain some of this structure. 

It’s just vital to remember that if you do continue contributing to your pension, you may trigger the Money Purchase Annual Allowance (MPAA).

If you’ve already started drawing from your pension but wish to keep contributing, the MPAA typically reduces your tax-efficient deposits from £60,000 to £10,000. 

4. Underestimating the true cost of retirement

After deciding what you want to achieve in retirement, you may assume that you can easily identify how much everything might cost.

You should remember that your retirement spending often follows a “bell curve” trajectory.

During the earlier years of the next chapter of life, you might spend much more due to holidays, home renovations, or new hobbies.

This spending might level off as you settle into a routine and tick items from your bucket list. 

Yet, your spending might rise again later in life, especially if your health deteriorates and you require care. 

This can be incredibly expensive, too, with carehome.co.uk revealing that you could pay an average of:

• £79,820 for nursing care
• £67,496 for a care home.

If you underestimate the true cost of retirement, you may withdraw too much too early, exhausting your fund and leaving you unable to fund care.

So, you may want to build a clearer picture of your future spending by separating essential costs, such as household bills, from discretionary spending, such as hobbies and holidays. 

From there, you could factor in inflation and regularly review your plan to ensure it remains realistic over time.

5. Not seeking financial advice sooner

At some point, you may have wondered whether you should be doing more to prepare for retirement. 

This uncertainty often stems from a lack of access to clear, professional guidance. 

Planning for retirement often involves a range of complex decisions, and it isn’t always easy to know whether you’re making the right choices. You might even find yourself asking questions such as:

• “How much do I need to save exactly?”
• “When can I realistically afford to retire?”
• “How should I access my pension?”
• “How can I minimise the amount of tax I pay?”

We work closely with you to understand your goals and then develop a strategy tailored to your unique circumstances.

Then, we can use sophisticated cashflow modelling software to show how your finances may evolve.

This can help you make more informed decisions and feel more confident about retirement.

To find out more about how we can help you, please call us on 01822 617 960, email info@hansfordbell.co.uk, or fill in our online contact form, and we’ll be in touch.

Please note

This article is for general information only and does not constitute advice. The information is aimed at individuals only.

All information is correct at the time of writing and is subject to change in the future.

Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.

The Financial Conduct Authority does not regulate estate planning, cashflow planning, or tax planning.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance. 

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.