How much money do you need for retirement/pension?
Discussion
Barga said:
Barga said:
6% is laughable my parents have been getting 14% since the last 22 years!
I would like to know if you had the £1m pension pot and went for drawdown ay 6% and the fund was growing at 3% how many years before it gets to zero?
Anyone?I would like to know if you had the £1m pension pot and went for drawdown ay 6% and the fund was growing at 3% how many years before it gets to zero?
Following that to the letter, about 33 years, but you have a steadily reducing income.
Do you mean drawing £60,000 pa and the fund growing by 3% pa? If so, about 23 years.
Audemars said:
Everyone should be aiming for a £1m pot. This is because a £1m pot will provide peanuts anyway. A lot of ordinary final salary pensions will be better than a £1m pot.
Achieving a £1m pot is easier if you start young. Earn over £150k (or rather an adjusted income of over £150k) and the max you can pay into a pension is £10k per year.
Stop paying that £600 per month pcp for that ordinary BMW, Audi, Range Rover and lump it all into your pension. A sub £1k Celica looks better anyway.
It's a sliding scale reduction. You need an adjusted income of £210,000 to be limited to £10,000.Achieving a £1m pot is easier if you start young. Earn over £150k (or rather an adjusted income of over £150k) and the max you can pay into a pension is £10k per year.
Stop paying that £600 per month pcp for that ordinary BMW, Audi, Range Rover and lump it all into your pension. A sub £1k Celica looks better anyway.
PurpleMoonlight said:
Audemars said:
Everyone should be aiming for a £1m pot. This is because a £1m pot will provide peanuts anyway. A lot of ordinary final salary pensions will be better than a £1m pot.
Achieving a £1m pot is easier if you start young. Earn over £150k (or rather an adjusted income of over £150k) and the max you can pay into a pension is £10k per year.
Stop paying that £600 per month pcp for that ordinary BMW, Audi, Range Rover and lump it all into your pension. A sub £1k Celica looks better anyway.
It's a sliding scale reduction. You need an adjusted income of £210,000 to be limited to £10,000.Achieving a £1m pot is easier if you start young. Earn over £150k (or rather an adjusted income of over £150k) and the max you can pay into a pension is £10k per year.
Stop paying that £600 per month pcp for that ordinary BMW, Audi, Range Rover and lump it all into your pension. A sub £1k Celica looks better anyway.
There are still benefits from lower tax rates on the growth and employer matching contributions
PurpleMoonlight said:
Barga said:
Barga said:
6% is laughable my parents have been getting 14% since the last 22 years!
I would like to know if you had the £1m pension pot and went for drawdown ay 6% and the fund was growing at 3% how many years before it gets to zero?
Anyone?I would like to know if you had the £1m pension pot and went for drawdown ay 6% and the fund was growing at 3% how many years before it gets to zero?
Following that to the letter, about 33 years, but you have a steadily reducing income.
Do you mean drawing £60,000 pa and the fund growing by 3% pa? If so, about 23 years.
Cheers for the calculation.
The way to do it is to relocate on retirement to somewhere that you can drawdown the pot tax free (legitimately).
Thats my plan anyway to bring my retirement age earlier, I can have the benefit of a 1m pot on just over half of that , with the added benefit of some sun on my back most of the year!
Thats my plan anyway to bring my retirement age earlier, I can have the benefit of a 1m pot on just over half of that , with the added benefit of some sun on my back most of the year!
dingg said:
The way to do it is to relocate on retirement to somewhere that you can drawdown the pot tax free (legitimately).
Thats my plan anyway to bring my retirement age earlier, I can have the benefit of a 1m pot on just over half of that , with the added benefit of some sun on my back most of the year!
Where is that?Thats my plan anyway to bring my retirement age earlier, I can have the benefit of a 1m pot on just over half of that , with the added benefit of some sun on my back most of the year!
Mark300zx said:
Cheib said:
I've been doing a lot of work on this recently.....£30k on £1mil is a 3% return so doesn't sound ridiculous in current environment.
Before you can answer the question "how much" you need to look at how much you actually spend. For most people (and certainly me that's a bigger number than you think/admit to yourself.
As an example....every day I get to work I've spent £20 on parking, train and a coffee by 8am. Not allowing for driving to the station i.e. petrol and in theory cost of using the car (depreciation and maintenance).
That's £5k a year.
It adds up sodding quickly!
Yes I am in the same boat (although hoping not to commute when I retire Before you can answer the question "how much" you need to look at how much you actually spend. For most people (and certainly me that's a bigger number than you think/admit to yourself.
As an example....every day I get to work I've spent £20 on parking, train and a coffee by 8am. Not allowing for driving to the station i.e. petrol and in theory cost of using the car (depreciation and maintenance).
That's £5k a year.
It adds up sodding quickly!
), I recently got an AMex card as I have been told that categorises your spending on the statement each month, so it may point to where I am being lavish!!But is that 3% before tax and then you have the issue with inflation and over the course of ten + years that figure losing it's value?
But yes your point does stand...if your drawing 3% then your savings will be eroded by inflation. Your money really needs to be invested in equities....something that is sold, decent growth prospects and paying a dividend too. Most stocks that look like that pay something like a 2% dividend though.
Cheib said:
williaa68 said:
Cheib said:
I've just bought this book to help me understand things a bit more...I've spent 30 years working in finance. It's a really, really complicated subject and I would say beyond most people to model themselves because of the tax implications of various ways you can hold your saving and, of course, the assumption you make about growh of your investments and costs. Oh and in the case of your investments haircutting for unforseen events like the GFC. Lots to think about.
https://www.amazon.co.uk/Beyond-4-Rule-retirement-...
I don't think ive ever seen a better reviewed book on Amazon! 98% 5 stars. Either its all the authors mates or there is something genuinely interesting in here. I will buy it and find out! Thanks for the tiphttps://www.amazon.co.uk/Beyond-4-Rule-retirement-...
https://blog.timelineapp.co/blog?category=New%20Fe...
Mark8303 said:
I passed 60 in May and recently went to see my ifa. He suggested working on 4% drawdown.
Over recent years I’ve saved more in isa accounts (mix of funds and shares) so now have a 50/50 split between pensions and isa savings. The plan is to use up the isa money first (tax free) letting the pensions continue to grow then use drawdown and the state pension to keep me into my dotage. The minute I calculate a 30k return I’m off to the shed to restore the bikes I’ve got lined up awaiting restoration.
You may be missing a trick by not taking tax free cash and tax free income from you pension.Over recent years I’ve saved more in isa accounts (mix of funds and shares) so now have a 50/50 split between pensions and isa savings. The plan is to use up the isa money first (tax free) letting the pensions continue to grow then use drawdown and the state pension to keep me into my dotage. The minute I calculate a 30k return I’m off to the shed to restore the bikes I’ve got lined up awaiting restoration.
See this thread:
https://www.pistonheads.com/gassing/topic.asp?h=0&...
Portugal has a 10 year tax free incentive for pensioners . thereafter you revert to the portuguese rates without special treatment.
Hopefully Italy will introduce something similar before my 10 years expire . I'm partial to a glass of Chianti and who doesn't like Italian food?
Re Italy it was a newspaper article , telegraph I think
Hopefully Italy will introduce something similar before my 10 years expire . I'm partial to a glass of Chianti and who doesn't like Italian food?
Re Italy it was a newspaper article , telegraph I think
dingg said:
Portugal has a 10 year tax free incentive for pensioners . thereafter you revert to the portuguese rates without special treatment.
Hopefully Italy will introduce something similar before my 10 years expire . I'm partial to a glass of Chianti and who doesn't like Italian food?
Re Italy it was a newspaper article , telegraph I think
So you could draw down your whole pension over a couple of years under flexi-access and pay no tax providing you go through the double taxation hoops?Hopefully Italy will introduce something similar before my 10 years expire . I'm partial to a glass of Chianti and who doesn't like Italian food?
Re Italy it was a newspaper article , telegraph I think
Is there no monetary limit in Portugal?
What stops you returning to the UK with all the cash in the bank?
PurpleMoonlight said:
So you could draw down your whole pension over a couple of years under flexi-access and pay no tax providing you go through the double taxation hoops?
yes but if you come back within 5 years (I think it is) you get hit for tax from uk
Is there no monetary limit in Portugal?
no limit - hit it as hard as you like
What stops you returning to the UK with all the cash in the bank?
nothing at all as long as you don't come back too early re taxyes but if you come back within 5 years (I think it is) you get hit for tax from uk
Is there no monetary limit in Portugal?
no limit - hit it as hard as you like
What stops you returning to the UK with all the cash in the bank?
eta , its good isn't it ?
Edited by dingg on Friday 14th September 13:40
the 5 year rule (I think from memory) I'd need to look it up
my plan is 9 years under the portuguese exemption, then relocate to either Italy (if it has the scheme in place, may even go earlier if it has) or back to uk as I will have drawn down fund to minimum level (and will be able to receive state pension then too) , may even empty it totally before I return depending on circumstances at the time.
my plan is 9 years under the portuguese exemption, then relocate to either Italy (if it has the scheme in place, may even go earlier if it has) or back to uk as I will have drawn down fund to minimum level (and will be able to receive state pension then too) , may even empty it totally before I return depending on circumstances at the time.
dingg said:
the 5 year rule (I think from memory) I'd need to look it up
my plan is 9 years under the portuguese exemption, then relocate to either Italy (if it has the scheme in place, may even go earlier if it has) or back to uk as I will have drawn down fund to minimum level (and will be able to receive state pension then too) , may even empty it totally before I return depending on circumstances at the time.
Interesting, ta.my plan is 9 years under the portuguese exemption, then relocate to either Italy (if it has the scheme in place, may even go earlier if it has) or back to uk as I will have drawn down fund to minimum level (and will be able to receive state pension then too) , may even empty it totally before I return depending on circumstances at the time.
dingg said:
the 5 year rule (I think from memory) I'd need to look it up
my plan is 9 years under the portuguese exemption, then relocate to either Italy (if it has the scheme in place, may even go earlier if it has) or back to uk as I will have drawn down fund to minimum level (and will be able to receive state pension then too) , may even empty it totally before I return depending on circumstances at the time.
Do you need to sell your property in the uk or just become resident in the other country?my plan is 9 years under the portuguese exemption, then relocate to either Italy (if it has the scheme in place, may even go earlier if it has) or back to uk as I will have drawn down fund to minimum level (and will be able to receive state pension then too) , may even empty it totally before I return depending on circumstances at the time.
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