Enjoying Retirement
Discussion
Export56 said:
I plan to burn through my pot until its zero, I can't see the problem with that. I have calculated that with no growth on the capital and and my pension rising by 5% each year it will run out at 92. Any interest will extend that., but I always take the worst case for safety.
Interestingly my pension has actually risen 7% per year for the last 10 years in investments alone, so I have no concerns that it will be more than ok.
Mine is 90 and I’ll take that plus it assumes me spending the same fixed amount per month which at 80 I certainly won’t be then there is downsizing and taking out cash again . Interestingly my pension has actually risen 7% per year for the last 10 years in investments alone, so I have no concerns that it will be more than ok.
Frankly Fuk working longer than I have to !
okgo said:
Not sure. His business is still going and he pays someone to run it so I guess he is still ‘earning’ vs eating his pot so not a problem so you speak but the point being is how active we will all be at that point vs what it looks like today.
Sounds like your old man is doing great . Hopefully it continues, good for him
ARHarh said:
my parents at 75 years old were away one week of every month in their caravan, very active and doing a lot of things. At 83 they have given up the caravan as it was getting a bit too much, they now rarely travel more than 20 miles from home. They lead a very different life to 10 years ago.
Good post & i suspect their monthly cost are very little ? There’s a thread on another platform called “ enjoy your life “ , the theme of which is about a guy in his mid 50’s that’s just been told he doesn’t have long left.
Made me think back to the JAYB thread and now one by Petrus 1983.
I know you don’t factor early death into your pension calculations but realistically how many of us are living to 90.
Pretty certain it won’t be me !
Made me think back to the JAYB thread and now one by Petrus 1983.
I know you don’t factor early death into your pension calculations but realistically how many of us are living to 90.
Pretty certain it won’t be me !
bogie said:
Yep my mum died young at 54, from healthy to diagnosed with pancreatic cancer and gone in under 5 months, more recently my uncle in late 60s a few years into retirement and now diagnosed with dementia. I know of over a dozen friends/acquaintances from school who didn't even make it to 50.
I plan to retire in my 50s and front load some of the spending from my SIPP, hopefully get a good 10 years of fun in whilst still fit and healthy. If I make it to 70 plus and blown the money, I the have state pension and a small DB pension as backup.
I know a few that are adopting the same idea with front loading pension. Makes sense I plan to retire in my 50s and front load some of the spending from my SIPP, hopefully get a good 10 years of fun in whilst still fit and healthy. If I make it to 70 plus and blown the money, I the have state pension and a small DB pension as backup.
timberman said:
I feel your pain, like a lot of people, mine and my wife's pensions have both took a bit of a battering in the last few weeks,
the annoying thing for me is, considering how well they were performing we were planning on making quite a big withdrawal in December from both my wife's and my pension to make use of our tax free allowance and to add to our house move budget,
we withdrew what we wanted from my wife's fund, but decided to leave mine till this month just to split them apart which I am now regretting, and given the current situation, unless the markets recover within the next month or so it looks like I may have missed the boat for this tax year.
I have a meeting with the wealth manager next week . the annoying thing for me is, considering how well they were performing we were planning on making quite a big withdrawal in December from both my wife's and my pension to make use of our tax free allowance and to add to our house move budget,
we withdrew what we wanted from my wife's fund, but decided to leave mine till this month just to split them apart which I am now regretting, and given the current situation, unless the markets recover within the next month or so it looks like I may have missed the boat for this tax year.
I have a feeling I’m may be a little hacked off !
Carbon Sasquatch said:
Just keep going & contributing what you can. There is no universal right number and what you perceive you need is very much based on what you are used to having.
Most of the numbers being used are for a couple - so if you can get 2 full state pensions, that's £18.6k as a baseline....
Who knows what will happen with the state pension, but I think most on here are close enough that we expect any future changes not to be applied to us - but could be in for a rude awakening.
Quite possibly on the basis Corona will have to be paid for many years to come sadly .Most of the numbers being used are for a couple - so if you can get 2 full state pensions, that's £18.6k as a baseline....
Who knows what will happen with the state pension, but I think most on here are close enough that we expect any future changes not to be applied to us - but could be in for a rude awakening.
OzzyR1 said:
First question:
https://www.gov.uk/new-state-pension/your-national...
Second question
https://www.gov.uk/voluntary-national-insurance-co...
Probably doesn't help much but not an expert on this in any way!!
Top man Tks https://www.gov.uk/new-state-pension/your-national...
Second question
https://www.gov.uk/voluntary-national-insurance-co...
Probably doesn't help much but not an expert on this in any way!!
GT03ROB said:
Most struggle to get the concept of pensions for themselves never mind trying to understand it for their offspring, so it doesn't surprise me in the least,
I'm certainly not financially illiterate however until the last couple of years never gave pensions any real thought. Now that sounds a bit like a contradiction I know. I just knew I'd paid into employers schemes since 21. as it turns out I'm now in a fairly reasonable place pension wise. I'll get full state pension, wife the same. The employer schemes have cost me very little, but are comfortably through the LTA.
The biggest pension issue at present for me is when to retire & start drawing on it. This makes threads such as this very interesting reading.
This is the big question for all of us and depends on so many factors . I'm certainly not financially illiterate however until the last couple of years never gave pensions any real thought. Now that sounds a bit like a contradiction I know. I just knew I'd paid into employers schemes since 21. as it turns out I'm now in a fairly reasonable place pension wise. I'll get full state pension, wife the same. The employer schemes have cost me very little, but are comfortably through the LTA.
The biggest pension issue at present for me is when to retire & start drawing on it. This makes threads such as this very interesting reading.
How old are you ?
Do you have kids to support still ?
Have you calculated your monthly outgoing needs ?
Lots to consider .
One thing I’ve found whilst discussing this with friends is that their estimates vary massively .
I’d say the range is between 2-6k per month amongst those I’ve asked.
Personally I’d go with 4K without holidays to live a comfortable life but that number will be laughed at by some as too much and too little by others.
Edited by GT3Manthey on Monday 7th February 07:24
timberman said:
That's the problem isn't it,
trying to gauge how much is needed based on other peoples experiences is going to give all sorts of figures,
the best you can hope for is a base line to cover everyday things,
after that it all depends on lifestyle, where you live and other dependencies or commitments.
For us, using the rule of needing between 50-70% of our working wage and after roughly calculating what we expect to spend, we decided on a figure of between £2500-£3000 per month after tax.
at the end of the day, as we both opted to go with drawdown, we'll have to live based on what we actually get from our pension funds,
If they don't perform then we're going to have to adjust out lives accordingly, pretty much like we did while working,
if not there's a risk of burning through our pension funds and running out of money.
All very true and noted . trying to gauge how much is needed based on other peoples experiences is going to give all sorts of figures,
the best you can hope for is a base line to cover everyday things,
after that it all depends on lifestyle, where you live and other dependencies or commitments.
For us, using the rule of needing between 50-70% of our working wage and after roughly calculating what we expect to spend, we decided on a figure of between £2500-£3000 per month after tax.
at the end of the day, as we both opted to go with drawdown, we'll have to live based on what we actually get from our pension funds,
If they don't perform then we're going to have to adjust out lives accordingly, pretty much like we did while working,
if not there's a risk of burning through our pension funds and running out of money.
The one thing I forgot to add was that as we get older we anticipate sending less so worth factoring this in when doing longer term projections .
Also we’ll have a downsize move too so that will release further equity
Wombat3 said:
This is the key, you have to be prepared to adjust. You can make all the calculations you like but if you are depending on some fund growth to see you out then if you get a market dip in the early years it can throw everything off by years.
The only way to minimise the effect of that would be to hold something like 12 to 18 months living expenses in cash so that you can give the fund some time to recover if you need to. Otherwise the double whammy of a withdrawal in a dip could be very expensive.
Very valid post. The only way to minimise the effect of that would be to hold something like 12 to 18 months living expenses in cash so that you can give the fund some time to recover if you need to. Otherwise the double whammy of a withdrawal in a dip could be very expensive.
- I think* !!
Take a look at what the stock markets done over the last two years .
I had this chat with my wealth manager who said he had clients just use the cash reserve over that period waiting for the market to recover .
It’s very key to have cash backup
Halitosis said:
I've still got at least 5 years of work before I can think of retiring, but I already know what I intend to do in my first week of freedom - drive up to the north west of Scotland and climb Stac Pollaidh. Hardly extravagant and likely rough camping. Also hope I'm physically capable by then 
I’m with you. Zero interest in sitting by a pool reading a book .
Plan is to sell up , relocate & buy a new defender and drive the British isles .
Heaven !
anonymous said:
[redacted]
Great cars and amazing how well they hold their value too . Looked at one last night , long wheel base 2014 car still 43k.
The wife will find it too agricultural is the issue so I’m thinking get other a new 110 or one with a few miles and never sell it .
Love the idea of travelling the British isles in one
caiss4 said:
Not sure I'd describe it as fantastic but it was certainly notable. I spent various spells over 6 months as a guest of the NHS having chemo and a stem cell transplant. The icing on the cake was this kicked off at the start of the first Covid lockdown
Anyway I'm now enjoying my retirement but the episode did cause a re-evaluation. I had been planning to retire in 2020 but the health issue brought the date forward and my wife who was planning on continuing to work for a further couple of years brought her retirement forward to the August that year.
To address the OP's original point after crunching the numbers we could cover our baseline with an income of around £25k so over the period from March 2020 to October last year our various pensions were triggered (all DB) and we're currently grossing mid-£40k which means we can live comfortably without stressing, however, we haven't had a holiday for almost 3 years. When Covid rules are generally relaxed then a couple of Euro road trips are planned but I'm not sure are current income would allow for more than one a year, if that!
Sorry to hear of the treatment you had to go through and here’s hoping it’s all come good for you. Anyway I'm now enjoying my retirement but the episode did cause a re-evaluation. I had been planning to retire in 2020 but the health issue brought the date forward and my wife who was planning on continuing to work for a further couple of years brought her retirement forward to the August that year.
To address the OP's original point after crunching the numbers we could cover our baseline with an income of around £25k so over the period from March 2020 to October last year our various pensions were triggered (all DB) and we're currently grossing mid-£40k which means we can live comfortably without stressing, however, we haven't had a holiday for almost 3 years. When Covid rules are generally relaxed then a couple of Euro road trips are planned but I'm not sure are current income would allow for more than one a year, if that!
Interesting stats on outgoings. I am happy in the numbers I’ve created in my spreadsheet allowing for all types of expenditure even though I feel I might be allowing too much . No bad thing I guess.
I also hadn’t really considered that our expenses I’ll reduce over time as we get older plus there will be an eventual final downsize at some stage.
I have an option to work part time too in a totally different business so whilst that may not mean full retirement as such it will bring a comfort blanket on rising costs of living .
I have a zoom call with the wealth manager tonight so hoping all is still ‘ on track’ .
Many Tks for you post and indeed all others.
GT03ROB said:
2k-6k is a pretty big range really. When you think for a married couple the state pension will give around 1.5k, then you have a range of a pension pot from very little up to about a million.
The issue is really one of what sort of discretionary expenditure do you want. If you retire earlier then you are most unlikely to see your expenditure drop, if anything it will rise. But you will no longer be saving out of income. Other things people mention such as mortgages/kids/etc., well those costs are not impacted by retirement. So you either have them or don't. The biggest factors to me are modelling growth into the future & modelling how your expenditure will fall as you age through retirement. Both are exceptionally difficult!
Your last point is very valid and one I’ll ask the WM this evening providing I remember as I’m getting old ! The issue is really one of what sort of discretionary expenditure do you want. If you retire earlier then you are most unlikely to see your expenditure drop, if anything it will rise. But you will no longer be saving out of income. Other things people mention such as mortgages/kids/etc., well those costs are not impacted by retirement. So you either have them or don't. The biggest factors to me are modelling growth into the future & modelling how your expenditure will fall as you age through retirement. Both are exceptionally difficult!
Will let you know any update .
As an aside I’ve also factored into my monthly costs my youngest being at Uni so this will drop out once she finishes up so naturally my expenditure will reduce.
In terms of having an exact number given inflation etc ive no idea!
Carbon Sasquatch said:
Al you can do is model - I've tormented myself with it extensively over the last year or so, initially in spreadsheets & then using Voyant.
There's very few factual elements beyond what you have at todays valuation. Then you get into a few reasonable assumptions, like the state pension. Then you get into more assumptions like what rate will inflation be, will the state pension grow with inflation (and not become means tested), will LTA stay the same, will tax rates stay the same, what will your investment returns be etc etc etc.
That's before you've guessed how long you will live & tried to predict how your spending might decline over time.
At best, you can set yourself a number to be in the right ball park. If you want certainty, then it's likely double that number.
I’m confident I’ll not need double but then it’s looking like a part time job is on the horizon . There's very few factual elements beyond what you have at todays valuation. Then you get into a few reasonable assumptions, like the state pension. Then you get into more assumptions like what rate will inflation be, will the state pension grow with inflation (and not become means tested), will LTA stay the same, will tax rates stay the same, what will your investment returns be etc etc etc.
That's before you've guessed how long you will live & tried to predict how your spending might decline over time.
At best, you can set yourself a number to be in the right ball park. If you want certainty, then it's likely double that number.
The biggest incentive is getting out of the hum drum city job I’ve been doing for too long .
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