Retirement, how much?

[screenman]

I'm starting to plan ahead and hope to retire around 60. By then I'll have put 32 years into a teacher's pension, along with a small private pension plus 'alternative' pension scheme. SWMBO will have an NHS pension as well although she's part-time.

The basic plan is to use that, plus working 2 or so days a week, until the state pension kicks in as well - if it ever does.

Hopefully that should put a decent pension from me and a bit from her into the coffers along with a couple of lump sums. Enough for a decent bike

That sounds like a good plan, my eldest is in the same profession I think his employees contribute to his pot as well.

 

[marzjennings]

I've always thought that any state pension would be non-exist by the time I retire and so for the last 15 years I've been putting away at least 15% of my income into some sort of tax free retirement account (currently a 401k here in the US). Any state pension I may get from the UK and US would be a bonus, but from my own savings I hope to retire on at least half my income. Planning to retire mid-60s, in about 17 years, mortgage and debt free by that point. Also thinking about retiring back to the UK as in general life basics and necessities are cheaper in the UK (health, gas, food, electricity, internet, property taxes, etc).
The wife and I intend to keeping travelling, globally, well into retirement so we'll need a healthy income every month, possible nearer the "luxury" end of the retirement income scale, though our travels are rarely luxury.

 

[Drago]

^^^Thats pretty much what I did since I was 18 Marz. I'd assiduously saved as much as I could, and aided by a couple of profitable house sales, and a lump sum from my ex in lieu of my share of that house I was well into 6 figures by the time I was divorced at 36. Fortunately, my Mums nagging was well ingrained by then and I resisted the urge to waste it on shiny German cars, foreign holidays, or £800 mobile phones, so when the Feds did get rid of me I was in a position to not bother working again at 47.

Many of my neighbours look down their nose at my little Ford Fusion of elderliness, but I get the last laugh when they have to drive to a day of drudgery each morning, some of them into their 60's. Screw that.

 

[Bromptonaut]

Would your spending decrease as you get older?
I expect a fit 68 year old spends far more than a house bound 85 year old.

Absolutely true. My late Mum was fairly well set up with her own pension from teaching and the State Pension plus a very good widows pension from my Father's work.

While she was fit and mobile she holidayed regularly with little expense spared and shopped for England. After a fall in her eighties she found it much more difficult to get out and couldn't travel except in with help car or disability equipped mini bus. Latterly she was very generous to all of us and particularly he elder grandchildren who were by then setting up home etc. She said money was coming in far faster than she could spend it.

Of course if she'd ever gone into a home all bets would be off.

 

[SpokeyDokey]

As a follow on from the retirement thread, how much do you need to be 'comfy?' Are you peeps spending more or less than anticipated? If you are taking advantage of a drawdown pension rather than an annuity is your pot dwindling faster than expected?

We lead a modest lifestyle and excluding capital expenditure (new cars, caravan, foriegn trip) reckon £20k pa should be enough is this realistic? With 2 of us oap should be at least £16k from the state, and with a defined pension taking us above this any private pension can therefore be used to fund early retirement, is this a dangerous tactic? QUOTE]

Our baseline outgoings pa are £12500 - this accounts for all utility bills, council tax, running the car, food, drink, fuel, insurances, broadband etc. This is for a reasonably sized house and modest new car.

On top of that we forecast £2500 pa on a contingency basis for 'everyday' things like replacing small household items, clothing etc.

Holidays, new cars and major house projects etc are funded from our reserves. As do new bikes.

I retired very early (48) although I now have a small lifestyle business that does produce a reasonable income but more importantly keeps me sane and amused.

Your costs sound realistic to me as you seem to live a similar lifestyle to us. Whilst we can easily afford to live a 'flash' lifestyle with fancy cars, expensive holidays, big wardrobes of clothes (we've done all that in the past) we opted for a much simpler life when we quit the corporate rat race. There was no financial driver for this but we grew tired of being wedded to, admittedly very well paying, jobs but they were jobs that kept us apart.

Switching off a very high disposable income was scary and took a fair bit of planning. I did post elsewhere when this subject came up that I put together a comprehensive cash flow forecast until I was aged 80.

This was a good 'are we doing the right thing' check and fortunately it indicated it was ie we would be just fine even using metrics that were sunny side down.

I took my main pension at age 53 (although it's now 55 earliest I think due to Gov' rule changes) and took a 25% lump sum although my pension was 'hit' by around 40%. My calculations showed that if I live beyond 93 years of age then I made the wrong decision!

My best advice, if you are on the cusp of making the decision that you have outlined, is to run a realistic cash flow projection yourself and see how it stacks up in the long term. Tbh I was pleasantly surprised when I ran my own as even though we have plenty of reserves the effect of compound interest (even at the very low rates we have today) made a significant impact on the forecast.

Good luck whatever you decide to do and never forget that 'selling your soul to the company goal' for too long may deprive you of vital years together - especially if the Grim Reaper comes looking for either of you too soon. Sounds a bit morbid but I'm afraid that is the reality of life as you get into your 'Golden Years'.

 

[Venod]

I feel quite irresponsible reading this thread as I retired early with very little planning, it was more of a hunch that we would be OK.
I had planned to pack in at 63 when I could claim my works pension, but the opportunity came at 59 with the firm wanting voluntary redundancies, with the offer of a lump sum and the opportunity to take an early pension, Mrs Afnug decided that when the firm she worked for closed that she wasn't working again, so no income from her, my pension at 59 was less than half of my salary, but a rough calculation said that my lump sum would last until the state pension kicked in at 65 for both of us, I wasn't happy at work so I took the package on offer.
Best decision I ever made, I did have to use some of the lump sum but not as much as I thought and the joy of doing what I wanted when I wanted, we have a house that is too big for the two of us so if need be we can downsize but at the moment we seem to be managing OK.

Of course it all depends on your lifestyle and expectations but we could manage on 20k and if you think you can go for it, nobody on their deathbed says " I wish I had spent more time at work" do they ?

 

[Flying Dodo]

Would your spending decrease as you get older?
I expect a fit 68 year old spends far more than a house bound 85 year old.

Until they need to start paying care home fees - then it's an ever increasing amount.

For pensioners, their expenditure is typically a U curve. A bit of a blow out at the start spending the tax free cash from the pension on luxury items like world cruises, new car, then it reduces to everyday bills, and then care home costs kick in.

 

[Winnershsaint]

I'm starting to plan ahead and hope to retire around 60. By then I'll have put 32 years into a teacher's pension, along with a small private pension plus 'alternative' pension scheme. SWMBO will have an NHS pension as well although she's part-time.

The basic plan is to use that, plus working 2 or so days a week, until the state pension kicks in as well - if it ever does.

Hopefully that should put a decent pension from me and a bit from her into the coffers along with a couple of lump sums. Enough for a decent bike

I went at 57 with 35 years in TPS. Had I stayed on I would have paid somewhere in the region of £10000+ extra pensions contributions to date which made it a seriously diminishing return. As you intend, I have continued to work part-time, in my case as a as a cover teacher. With most large bills gone apart from a mortgage we will never pay off until we downsize and move somewhere cheaper we are comfortable. The Directeur Sportive has a few years to go yet although was made redundant from NHS so has that pension already. In addition she was in the BHS pension scheme for a short while in the 80s and has settled for a single lump sum payment from that. Off to the Maldives for Feb half term.

 

[Tin Pot]

You just have to careful that.....
a) you never fall out with your kids.
it has happened
b) you dont pop your clogs withi 7 years
otherwise your kids will be liable.
The secret is to know exactly what date you will both die and how much pa you will need.

Plan your death.

At retirement, divide up whatever you by seven, burn through that per year and then blow your brains out on the doorstep of the Inland Revenue

 

[Dirk]

Plan your death.

At retirement, divide up whatever you by seven, burn through that per year and then blow your brains out on the doorstep of the Inland Revenue

I plan to live a lot longer than 67.

 

[Tin Pot]

I plan to live a lot longer than 67.

Pfft. Coward!

 

[Tin Pot]

My worry about becoming a gigolo is the sort of woman that fancies a young chicken like me.

View attachment 384080

 

[MarkF]

Many of my neighbours look down their nose at my little Ford Fusion of elderliness, but I get the last laugh when they have to drive to a day of drudgery each morning, some of them into their 60's. Screw that.

That's great for you but I work with 2 men, both 10+ years older than me, one is 67, they both work 3 days a week. They are really lovely, optimistic, positive, funny blokes, full of energy, we go out socially as well. They are as far away as you could imagine from OAP's, neither needs to work but both worry they'll "get old" if they stop. IMO they have the best of both worlds, PT work in a very sociable environment and plenty of free time too, it's made me think I might carry on later than I thought I would.

 

[Drago]

That's great for you but I work with 2 men, both 10+ years older than me, one is 67, they both work 3 days a week. They are really lovely, optimistic, positive, funny blokes, full of energy, we go out socially as well. They are as far away as you could imagine from OAP's, neither needs to work but both worry they'll "get old" if they stop. IMO they have the best of both worlds, PT work in a very sociable environment and plenty of free time too, it's made me think I might carry on later than I thought I would.

They may be lovely, optimistic, positive, funny blokes, but they're still at work.

 

[screenman]

That's great for you but I work with 2 men, both 10+ years older than me, one is 67, they both work 3 days a week. They are really lovely, optimistic, positive, funny blokes, full of energy, we go out socially as well. They are as far away as you could imagine from OAP's, neither needs to work but both worry they'll "get old" if they stop. IMO they have the best of both worlds, PT work in a very sociable environment and plenty of free time too, it's made me think I might carry on later than I thought I would.

I get a real buzz out of earning a few bob doing something that I enjoy, others call it work I do not.