Aviva Investment Account

How to invest money in your 60s

Guide to managing your finances

If you have money to invest in your 60s – a decade which for most people marks the final years of salary-earning life – it’s likely you’ll want to make investments that give you the best return in retirement.

Everyone’s financial situation is unique, so there’s no plan that’s right for everyone, but there are a few things that everyone should think about.

How much should you pay into your pension?

There’s no golden rule for the amount, but your pension should be a top priority for any disposable income you have. It’s money you’ll likely be starting to claim in just a few years and as you're likely to get tax relief on your contributions (and potentially matched contributions from your employer too), it’s a fast way to grow your money.

How can you increase the amount you've already saved into your pension?

It’s not uncommon for people to reach their 60s and realise they want to address a shortfall in their pension.

The first thing to do is to make sure that you'll receive your full State Pension, which you can check on the government’s website. If you’re not currently eligible for the full amount, you may be able to make top-up payments that could pay off well in retirement. Another option is to delay claiming your State Pension, which could increase the payment once you do start claiming. For more information around the state pension check out the Governments website here

You could also consider making extra one-off payments into your workplace or personal pension. 

Taking more control of where your pension money is invested could also help you to grow the total. With our pensions, you have a choice of around 1,800 investment funds, so check you’re getting a good return from yours.

How should you invest in your 60s?

As you near retirement, protecting the sum you’ve already accumulated may be a greater concern than growing it. If this is the case, you’ll probably want to consider switching to lower-risk investments.

You may also want to make investments that will provide an income in your retirement. There’s no way to guarantee this, but usually stocks and shares are intended either to grow in value or to pay dividends. Dividends provide a regular income, so these stocks and shares could be a good addition to your portfolio.

Although be aware that the value of your investments can fall as well as rise and you could get back less than you invested.

Alongside pensions, we also offer a Stocks and Shares ISA and an Investment account.

How should you invest if you’re planning your estate?

You may be starting to think about the money you're leaving to friends and family as part of your estate.

Remember that cash gifts aren’t subject to inheritance tax if 7 years passes before your death. So if you'd like to ensure loved ones are provided for, gifting money now for them to invest themselves could suit you. But of course you need to make sure you still have enough to live comfortably too.

Another option is shifting more of your wealth into your pension over the next few years (up to the maximum allowance), as this isn't usually subject to inheritance tax when you pass away.

Of course, while there are many different ways for you to grow the money you have, the best one for you will depend on your own unique circumstances. Remember, if you’re not comfortable making these decisions yourself, a financial adviser can help.

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