With ongoing discussion around pension rules and planned changes from April 2027, many people are taking a closer look at their retirement planning and long-term financial position.

While speculation often surrounds areas such as tax-free cash and inheritance tax, the underlying questions remain consistent: how much do you need in retirement, how should your assets be structured, and what can you afford to gift without affecting your own financial security?

These are not decisions to be made in isolation. Effective financial planning brings together retirement income planning, gifting and estate planning into a single, considered approach.

How much do you need in retirement?

A common starting point is understanding what your retirement might cost. This goes beyond identifying a single number and instead focuses on your expected lifestyle, future expenditure and how these may evolve over time.

From everyday living costs through to later-life considerations, having clarity here provides the foundation for all other financial decisions.

You can read more in our article:
How much do I need in retirement?

How much can you afford to gift?

For many, financial planning also involves supporting family members during their lifetime, whether through regular gifts or more significant financial support.

However, gifting too much, or too early, can create challenges later on. This is particularly relevant as pensions are expected to form part of the inheritance tax landscape from 2027, making the balance between retaining and passing on wealth more nuanced.

Understanding what you can afford to give, while maintaining your own long-term financial independence, is key.

Explore this further here:
How much can I afford to gift?

Bringing it all together with cashflow modelling

Ultimately, these questions are best answered not in theory, but through detailed planning.

Cashflow modelling allows you to map out your financial future, helping you understand how your assets may support your lifestyle over time. It can also assess the impact of decisions such as gifting or accessing pension benefits, both now and in the future.

Find out more about how this works in practice:
What is cashflow modelling?

A joined-up approach to financial planning

With potential changes to pension taxation on the horizon, it is increasingly important to view retirement planning, gifting and estate planning as interconnected.

To discuss any of these areas with our team of Financial Planners please contact us on  0330 320 9280, email info@cravenstreetwealth.com or complete our online enquiry form.

 

The content of this article is for information only and does not constitute formal financial advice. This material is for general information only and does not constitute investment, tax, legal or other forms of advice.

References to legislation and tax is based on our understanding of United Kingdom law and HM Revenue & Customs practice at the date of publication. These may be subject to change in the future. Tax rates and reliefs may be altered. The value of tax reliefs to the investor depends on their financial circumstances. No guarantees are given regarding the effectiveness of any arrangements entered into on the basis of these comments.

You should not rely on this information to make, or refrain from making any decisions. Always obtain independent, professional advice for your own particular situation.

Craven Street Financial Planning Limited is authorised and regulated by the Financial Conduct Authority (FCA). The FCA does not regulate tax advice.