How much money do you need for retirement/pension?
Discussion
red_slr said:
I hope not! I plan to retire early / mid 40s.
I don't plan to sit around doing nothing though, the only issue is "doing stuff" generally costs, especially travel. But I think we can do it, we will adjust our plans according to our income. I have worked since 17 and I don't plan to work more than 30 years so that gives me to 47 as a max.
How does travel work? With regards to school terms - you will by default have to go during peak times so it cannot be the cheapest. I don't plan to sit around doing nothing though, the only issue is "doing stuff" generally costs, especially travel. But I think we can do it, we will adjust our plans according to our income. I have worked since 17 and I don't plan to work more than 30 years so that gives me to 47 as a max.
garyhun said:
Barga said:
Welshbeef said:
Is returning at 45yo possible for the average person?
Potentially 25 year mortgage cleared (commenced at 20yo).
Or would it be exceptionally difficult for all but the few who are lucky and those who take big risks.
Note when I say average I mean that is with having children....
I don't think you can access a PP until 55.Potentially 25 year mortgage cleared (commenced at 20yo).
Or would it be exceptionally difficult for all but the few who are lucky and those who take big risks.
Note when I say average I mean that is with having children....
EddieSteadyGo said:
JulianPH said:
I tried doing just this and whilst the financial aspect was not the slightest issue I became incredibly bored very quickly!!!
Of course it is possible, but it is not just about having the assets you will need to provide an inflation/index linked income to see you through the next (potential) 50 years with the lifestyle you want (and the ability to support your kids both today and as needed in the future).
It is about your mental disposition. To have the ambition and determination required to reach such a goal entails a high degree of dedication and a certain mindset. This is not easy to switch off...
So doing this is possible, but it is not simply a financial issue.
This is very true.Of course it is possible, but it is not just about having the assets you will need to provide an inflation/index linked income to see you through the next (potential) 50 years with the lifestyle you want (and the ability to support your kids both today and as needed in the future).
It is about your mental disposition. To have the ambition and determination required to reach such a goal entails a high degree of dedication and a certain mindset. This is not easy to switch off...
So doing this is possible, but it is not simply a financial issue.
Holidays with kids when they're young? Holidays for you? That car you want? The experiences, shows, nights out you sacrifice? Is it really worth while so you can stop working at 45 and then do what with your time?
Reminds me of this little tale;
There was once a businessman who was sitting by the beach in a small Brazilian village.
As he sat, he saw a Brazilian fisherman rowing a small boat towards the shore having caught quite few big fish.
The businessman was impressed and asked the fisherman, “How long does it take you to catch so many fish?”
The fisherman replied, “Oh, just a short while.”
“Then why don’t you stay longer at sea and catch even more?” The businessman was astonished.
“This is enough to feed my whole family,” the fisherman said.
The businessman then asked, “So, what do you do for the rest of the day?”
The fisherman replied, “Well, I usually wake up early in the morning, go out to sea and catch a few fish, then go back and play with my kids. In the afternoon, I take a nap with my wife, and evening comes, I join my buddies in the village for a drink — we play guitar, sing and dance throughout the night.”
The businessman offered a suggestion to the fisherman.
“I am a PhD in business management. I could help you to become a more successful person. From now on, you should spend more time at sea and try to catch as many fish as possible. When you have saved enough money, you could buy a bigger boat and catch even more fish. Soon you will be able to afford to buy more boats, set up your own company, your own production plant for canned food and distribution network. By then, you will have moved out of this village and to Sao Paulo, where you can set up HQ to manage your other branches.”
The fisherman continues, “And after that?”
The businessman laughs heartily, “After that, you can live like a king in your own house, and when the time is right, you can go public and float your shares in the Stock Exchange, and you will be rich.”
The fisherman asks, “And after that?”
The businessman says, “After that, you can finally retire, you can move to a house by the fishing village, wake up early in the morning, catch a few fish, then return home to play with kids, have a nice afternoon nap with your wife, and when evening comes, you can join your buddies for a drink, play the guitar, sing and dance throughout the night!”
The fisherman was puzzled, “Isn’t that what I am doing now?”
Condi said:
A more refined version of the same joke posted several times before!!
It is a very good joke/lesson and I feel very special you posted it again in response to something I said! 
On a serious note though, that is exactly the point. I love what I do. Retiring would mean stopping doing what I love.
If you don't love what you do it is possible to retire early on the same money, providing you make the lifestyle choices that support this.
JulianPH said:
Derek Chevalier said:
JulianPH said:
So, in my opinion, paying an adviser a time cost fee for a financial plan and the selection of investment manager(and paying on the same basis when you want this reviewed) could add significant value. Paying the an annual percentage of the value of your funds however does not, on the face of it, provide any value, only cost.
Focusing purely on the investment side, in the world of the rational investor, where they invested in a portfolio in line with their long term objectives, and didn't chase hot funds, buying high and selling low, I would agree. But the data does not show that for the "average investor".dsl2 said:
I've often had this discussion with my St James Place guy as they charge fees like the proverbial Rhino which clearly I'd much rather have in my bin than theirs!
Do you know how much (total - fund, adviser, SJP costs etc) they are charging you per year (in % terms)? I'm not sure they are that much more expensive than the equivalent IFA offering.rockin said:
Derek Chevalier said:
I'd love to know how you are able find someone that is able to beat the market average (assume by picking winning funds in advance) when even the very best find it nigh on impossible.
If an investor can't be bothered to look at a few funds' performance and spot which ones are consistently doing better than others then the investor deserves whatever performance he gets. It's not difficult with Morningstar and other ratings widely available.I try not to buy lousy cars and I try not to buy lousy investments - there are plenty of both out there! I certainly don't want an average, beige saloon.
https://www.economist.com/finance-and-economics/20...
JulianPH said:
The state pension is £6,736 and so this leaves a shortfall of £11,264 gross annual income required.
.
Think that might be the old state pension, new is around £8,500 if you've accrued sufficient credits.
https://www.gov.uk/new-state-pension/what-youll-ge...
joyless lobotomised parrot said:
Welshbeef said:
This is exactly the info I was after thank you Julian.
Actually unless you reached state pension age before Apr '16 the current state pension is £8546.20p with full contributions. Edited by joyless lobotomised parrot on Saturday 15th September 15:19
Derek Chevalier said:
sidicks said:
So the key question is how well that manager has performed given the benchmark they are managing against.
I think you'd have more success solving Fermat's last theorem - not sure SJP publish that data!And Fermat’s last theorem was proved in 1991 (I think) as I remember studying this during my number theory course.
Derek Chevalier said:
You seem to be inferring that previous outperformance is indicative of future outperformance.
Absolutely right. It's better than relying on some IFA, staring into his crystal ball and giving you silver-tongued garbage about the value of his "advice".Remember: When things go well the IFA tells his clients it's due to the excellence of his advice. When things go badly the IFA blames "unexpected market movements". And best of all, the IFA pockets pretty much the same fees either way.
sidicks said:
So you just look at returns, ignore risk, ignore manager style and regard this as 'common sense'?
At the end of the day, returns are all that matters. How you got there is completely irrelevant so long as you get there on a consistent basis. I'm happy to pay fund managers for what they do. They get paid a lot because they're good at the job. If it all works out, everyone's a winner.No point having a dog and barking yourself.
rockin said:
At the end of the day, returns are all that matters. How you got there is completely irrelevant so long as you get there on a consistent basis. I'm happy to pay fund managers for what they do. They get paid a lot because they're good at the job. If it all works out, everyone's a winner.
No point having a dog and barking yourself.
It depends if you want to give yourself the best possible chance of the best returns or not - otherwise it’s much more about trusting to luck!No point having a dog and barking yourself.
sidicks said:
Derek Chevalier said:
sidicks said:
So the key question is how well that manager has performed given the benchmark they are managing against.
I think you'd have more success solving Fermat's last theorem - not sure SJP publish that data!And Fermat’s last theorem was proved in 1991 (I think) as I remember studying this during my number theory course.
I remember reading the book on the solving - fascinating (really!) stuff.
rockin said:
Derek Chevalier said:
You seem to be inferring that previous outperformance is indicative of future outperformance.
Absolutely right. It's better than relying on some IFA, staring into his crystal ball and giving you silver-tongued garbage about the value of his "advice".Remember: When things go well the IFA tells his clients it's due to the excellence of his advice. When things go badly the IFA blames "unexpected market movements". And best of all, the IFA pockets pretty much the same fees either way.
Derek Chevalier said:
I'm not convinced that even when compared to a 90s era IFA that picks funds....
Hang on - I had a 2014 IFA, well RFA, who was very happy to pick funds and sat down with a laptop and showed me lots of graphs and something about alpha IIRC. Mind you when things went wobbly he said he wasn't a fund picker. Go figure...Gassing Station | Finance | Top of Page | What's New | My Stuff