Forum menu
I read this recently:
"Retirement is wonderful if you have two essentials—much to live on and much to live for.”
The most glaring assumption in that link is that people own thier own home when in fact 35% of households rent.
Rather than persuading people to save more it looks to me like they're trying to con people they can live on a state pension and still have a hot shower.
Yep,I’d not really thought about till I was thinking retirement, the simple and brutal luxury of owning is that you don’t have rent to pay.
So ‘no shit Sherlock’ your able to live on far less of a pension and I doubt people renting aren’t probably pushing tons of money into a pension.
Makes the thread even grimmer reading for anyone not on the property ladder but then as a kid I wasn’t exactly sat with a spreadsheet working out my retirement plans.(it was more cars,sex and beer,which may or may not still be applicable.:-)
I read this recently:
"Retirement is wonderful if you have two essentials—much to live on and much to live for.”
TBH so is life in general,it’s not specific to retirement 🙂
the simple and brutal luxury of owning is that you don’t have rent to pay.
And add to that, the ability for many of those homeowners to be able to downsize and release a chunk of equity (as well as reduce other overheads like council tax, heating, maintenance etc).
I think most people who are lucky/ organised enough to be retiring mid fifties will have a significant chunk of their money outside pension and so can use it when they want.
A downside to pensions is that they cant be accessed until you are 55 (atm) if you are in a position to retire in your mid fifties then that is not an issue and therefore they are one of the most tax efficient ways to store and grow your cash, if your retirement is within a small number of years you are likely putting as much of your cash into them as you can, not taking money out.
That link says £600 a year for home maintenance….really? I pay a she’d load more than that now and I’m barely in it!
Exactly my view. That's barely two days work on the house. No way that works over 30 years for the pile of shit I live in.
TBH I don’t remember seeing many old people living in homes that you’d go ‘love the decor’ in my life :-).
Whereas I have paid far less than that over 35 years living where I do ( although I have dodged a £15000 bill but even that is under £500 a year)
I think most people who are lucky/ organised enough to be retiring mid fifties will have a significant chunk of their money outside pension and so can use it when they want.
A downside to pensions is that they cant be accessed until you are 55 (atm) if you are in a position to retire in your mid fifties then that is not an issue and therefore they are one of the most tax efficient ways to store and grow your cash, if your retirement is within a small number of years you are likely putting as much of your cash into them as you can, not taking money out.
Further to this, the age is due to rise to age 57 in April 2028, then be aligned to state pension age -10 years therafter. Its therfore wise to have some other assets that are accessible, e.g. an ISA if you are caught in this trap and want to go before the NMPA.
Another important consideration is taxation, as it can be onerous with large pension withdrawals. You can get a surising amount out a pension if you are careful how and when this is withdrawn.
e.g. If you retired at age 55 and had no other income until state pension at age 67, you could draw taxable income of £12,750 pa (up to Personal Allowance) free of income tax for 12 years that could be supplemented with Tax Free Cash and or ISA withdrawals. That a total of over £200k out the pension alone that you could draw tax free when accounting for the corresponding TFC from crrystallisation and thats assuming the personal allowance remains static.
Could I retire on forty quid?
Because I have that right now, and I have very little will to work left...
You can get a surising amount out a pension if you are careful how and when this is withdrawn.
Tax efficiency is good. And indeed, the less you take out of a pension pot the more likely it is to last. But as YMMV tax is an unavoidable thing if you want or need more money.
400k with no mortgage and no dependents is a very different picture than someone still carrying big monthly costs. The real question is not the headline number, it is what you actually spend per year. If your lifestyle sits around 20k to 25k a year, that pot can last a long time if invested sensibly. If you are closer to 35k plus, it gets tight fast and you either need part time income or a few more working years to build a buffer.Inspired by the thread with the chap talking about mortgage overpayments v investing, im interested in what others think they need for retirement.
Personally im sick to death of work & bored senseless. I own my own home, not married, no children or dependencies, early 50's. I have about 400k in savings, pensions & investments.Lately ive been trying to decide if this is enough to jack it all in? Although 1/2 of me thinks whilst its possible to earn good money then I should continue to do so, but at what point do you decide enough is enough.
I appreciate there will be those who have considerably more & those who have considerably less.And before anyone asks, I don't like to talk about my charity work.
A lot of people use the rough 4 percent rule as a sense check. On 400k that gives about 16k a year before tax, so you need to see how that lines up with your real spending, not guesses. Early 50s also means funding maybe 35 plus years, so sequence of returns matters more than people think.
If you are mentally done with work, a halfway option is often easier. Drop to something low stress for a few years, let the investments keep growing, and test living on your “retired” budget now. That tells you very quickly whether you are ready or just burned out and needing a reset.
The 4% rule was based on leaving the pot largely intact, through growth, to pass onto dependents. In the case of the poster, he has no dependents, so theoretically could work on a higher % figure.
400k with no mortgage and no dependents is a very different picture than someone still carrying big monthly costs. The real question is not the headline number, it is what you actually spend per year. If your lifestyle sits around 20k to 25k a year, that pot can last a long time if invested sensibly. If you are closer to 35k plus, it gets tight fast and you either need part time income or a few more working years to build a buffer.Inspired by the thread with the chap talking about mortgage overpayments v investing, im interested in what others think they need for retirement.
Personally im sick to death of work & bored senseless. I own my own home, not married, no children or dependencies, early 50's. I have about 400k in savings, pensions & investments.Lately ive been trying to decide if this is enough to jack it all in? Although 1/2 of me thinks whilst its possible to earn good money then I should continue to do so, but at what point do you decide enough is enough.
I appreciate there will be those who have considerably more & those who have considerably less.And before anyone asks, I don't like to talk about my charity work.
A lot of people use the rough 4 percent rule as a sense check. On 400k that gives about 16k a year before tax, so you need to see how that lines up with your real spending, not guesses. Early 50s also means funding maybe 35 plus years, so sequence of returns matters more than people think.
If you are mentally done with work, a halfway option is often easier. Drop to something low stress for a few years, let the investments keep growing, and test living on your “retired” budget now. That tells you very quickly whether you are ready or just burned out and needing a reset.
Hmmm Have you thought about ‘living the dream’.
Rent the house out and buy something sensible in Spain (or rent to see if it’s for you), not saying it’s easy and for everyone but the weather,lifestyle and although it’s not like it used to be the cost of living and things like council tax are much more manageable.
if you can’t crank up the the income the other option is to crank down the outgoings.
I’ve banged on that Brexit has meant you have to show more money than previously but it’s still possible and people are still coming over.
How do they do it dudeofdoom? A family member has said they can no longer do it. The Golden Visa scheme ended last year so unless you can get a very well paid job with a Spanish company how do you do it? Portugal has got a lot more complicated in the last year too.
Even as an EU couple we'd have to demonstrate a jointe income of 36 000e a year to be able to retire in Spain. So we could but having already lived in Spain I'll stick with France. There is no minimum in France BTW.
How do they do it dudeofdoom? A family member has said they can no longer do it. The Golden Visa scheme ended last year so unless you can get a very well paid job with a Spanish company how do you do it? Portugal has got a lot more complicated in the last year too.
Even as an EU couple we'd have to demonstrate a jointe income of 36 000e a year to be able to retire in Spain. So we could but having already lived in Spain I'll stick with France. There is no minimum in France BTW.
Presumably via the non lucrative visa
https://ageinspain.org/non-lucrative-visa-nlv-guide/
Thank you, julians. So I can tell my family member to apply. The requirement is the same as it would be for me, 36 000e income.
I'm currently floating ideas past my sister about retiring, or doing something different. She's 54 and recently diagnosed with breast cancer, and has just finished treatment and gone back to work. Except. They have turned round and said they are making her redundant - some reorganisation in the background. Possibly a chance of another job with them at the other end of the country. Husband works full time, no kids, no mortgage. She'll get a year and a half redundancy pay (she earns six figures), and she's already had critical life pay out. Work is 'her life'.
I've said, if they are going to treat you like this after 25 years, take the money. Work out how much you need a month and see what you will have for the next 6 years until you can draw your pension without penalties at 60 (she could retire with a pension in the next year at 55). Your husband can still work, you can go do something you want to do, part time/volunteer etc. She's currently knackered as she's literally finished treatment and gone back to work as she is dedicated. Then they do this to her.
We can't convince her there is more to life than work, and she's very well off financially. They are both skinflints though, so don't really spend much. I've asked her to consider just how much money do they need to live off. My wife isn't working now and we manage off my wages, and we have an adult child at home (Uni).
Her head isn't right at the moment as the cancer diagnosis really knocked her for six, but I wouldn't be working for a company that binned her off after 25 years. I'd be skipping down the road with a good pay out and doing stuff I wanted to do.
Anyway, we'll all chip away at her !
What seems logical and sensible to some can seem quite the wrong choice to others, we’re all wired differently. I do also think that for most of us, as we get into our 60’s and beyond, the fun of the work we may have done for 30 plus years has diminished.
The 4% rule was based on leaving the pot largely intact, through growth, to pass onto dependents. In the case of the poster, he has no dependents, so theoretically could work on a higher % figure.
This is not the case - broadly it is the safest withdrawal rate such that you are unlikely to run out of money after 30 years
It is also US based - for UK, 3% is a better starting point - see e.g. https://monevator.com/safe-withdrawal-rate-uk/
^^ that reads very like an article written by the investment industry…
She'll get a year and a half redundancy pay (she earns six figures), and she's already had critical life pay out. Work is 'her life'.
I'd be getting the union involved if a member. Seems a bit dodgy to make someone redundant after they've been ill and if nothing else they may make an improved offer to avoid the unfair dismissal tribunal.
That's exactly what the article claims to be, iainc, with references to where the 4% "rule" comes from and all the working showed which is quite unusual. I like it, it's one of the most objective articles linked so far and includes the idea that past performance isn't a particularly good indicator of future performance so any rule can fail. Thank you, sofaman.
^^ that reads very like an article written by the investment industry…
Monevator is a respected, independent, UK blog (my opinion - you can differ obviously :-).
There are plenty of other independent (and non-independent) resources detailing what the '4% rule' really means. Misinterpreting it could be a very costly mistake.
Seems a bit dodgy to make someone redundant after they've been ill
If they have followed procedures correctly, then it isn't really a problem – yes it's a bit shitty, but if the role is no longer required, then it's perfectly legal to do so.
Seems a bit dodgy to make someone redundant after they've been ill
If they have followed procedures correctly, then it isn't really a problem – yes it's a bit shitty, but if the role is no longer required, then it's perfectly legal to do so.
She might be kicking herself in a couple of years time if she doesn't take it, these offers are often not on the table indefinitely. I know many colleagues that would leap at that offer, at that age. Having been through a few of these organisational changes I have hardened my attitude to work; the emotional response that a company owes you something isn't very productive.
I don't think I have seen much attention to the fact that the tax free redundancy amount has been sat at £30k since 1988, should be well over £80k by now adjusted for inflation.
I think they have restructured the team whilst she's been off (only 3 months off) and the lot are redundant/have to find new positions. She's a workaholic, but we will try. She wouldn't listen to anyone in the family about her diagnosis, she thought it was a death sentence. She's been lucky to get to 54 with nothing than doctors appointments. Never had surgery or major accidents (unlike me) .
I've said sit down and work out what you need. We are talking a serious amount of money from redundancy and also her life pay out. None of us can understand why she wants to carry on working - and her siblings are an accountant, solicitor and dentist. She's an insurance underwriter - very stressful job as has been dealing with trade insurance and Russian impacts etc. Unfortunately, she's very money driven, but never spends it. She has no-one to leave it all to ?
Unfortunately, she's very money driven
You are fighting an uphill battle then. My brother-in-law was a high flyer, nearly retirement age and financially very comfortable. He left work after the suicide of a child, I thought that he will obviously never work again. But he is looking to go back, I don't understand the motivation but obviously his career is far more important to him than mine is to me.
TBH all some people have is work, it’s pretty much drummed into us from a young age to work, we’ve all been radicalised that we need to work and spend continuously on stuff so there’s a reluctance to stop until your literally booted out the door.
I think some people are just compulsivley busy, like they can't cope if they are not rushed off thier feet - that goes for work and leisure, I've never really understood it, but then I'm the opposite.
Its easy to be judgemental about people continuing to work when they dont need to. As above we are programmed to work. I worked from 16 to 57 without a break (obvs hols etc...) and i have found it very difficult to overcome the guilt associated with not going out to work each day. It hasn't quite been the stress free process I had hoped for but I am sure from the outside it looks like bliss.
I worked from 16 to 57 without a break (obvs hols etc...) and i have found it very difficult to overcome the guilt associated with not going out to work each day. It hasn't quite been the stress free process I had hoped for but I am sure from the outside it looks like bliss.
i get this. myself and the wife retired 5 years or so ago me 55 her 56.
i can happily while my time away doing nothing. typical day is up at 8. tea and coffee, followed by a bike ride. back for lunch then a walk. teatime then relax doing whatever. i do this 7 days a week... love it.
my wife managed this for the first 4 years when we had the 2 youngest grandkids, then they started school fulltime. she found she then got pretty bored. but moreso she said she needed something to work her brain a bit. a friend offered her a couple of days work in her shop. 2 days 4 hours per day, and she took it. she loves it. works her brain. spending time with similar aged women who work there. i am happy, i just ride my bike a bit more.
Its easy to be judgemental about people continuing to work when they dont need to. As above we are programmed to work. I worked from 16 to 57 without a break (obvs hols etc...) and i have found it very difficult to overcome the guilt associated with not going out to work each day. It hasn't quite been the stress free process I had hoped for but I am sure from the outside it looks like bliss.
I'm a bit this way, but now have in mind that my working, means that a other colleagues (who still need the earnings) don't get the hours/money. I've gone to just 'filling the gaps' (self employed/contract work).
Working P/T definitely makes the time off more valued.
Sorry! I wasn't being judgemental, just thinking out loud.
For me, working isn't good value for money if I don't have to.
But I've always very much been 'work to live' rather than 'live to work'... It's just a means to an end for me.
I'm keeping my eyes open for something flexible/part time but to be frank, there's not many jobs in that catagory that are worth my time and effort when I'm making good passive income from investments.
I'm just so jaded with the rat race and the 'personalities' one has to deal with, rather than just working in itself.
So - I have just been on ChatGPT, told it pretty much everything I know now (current fund value, future contributions, house value, mortgage end date, ideal retirement date, age difference between my wife and me), and what I am thinking in my head about what my future looks like (how I would liek to live, concerns over health and inheritances etc) and bloody hell! It is so helpful!
I’d now get it to cite its sources and manually double check everything it’s told you 🙂
I like AI (even more now it can’t take my job) but it’s a bit keen to please 🙂
ChatGPT is like therapy LOL!!!!
One Very Honest Observation
You’re thinking like someone who wants:
Security for your spouse
Stability for your children
Fairness within the family
And a responsible second half of life
I’d now get it to cite its sources and manually double check everything it’s told you
I know it will be far from perfect, but it is helpful in putting loads of crap that is in my head out in the open and stress-testing it!
How do they do it dudeofdoom? A family member has said they can no longer do it. The Golden Visa scheme ended last year so unless you can get a very well paid job with a Spanish company how do you do it? Portugal has got a lot more complicated in the last year too.
Even as an EU couple we'd have to demonstrate a jointe income of 36 000e a year to be able to retire in Spain. So we could but having already lived in Spain I'll stick with France. There is no minimum in France BTW.
Presumably via the non lucrative visa
https://ageinspain.org/non-lucrative-visa-nlv-guide/
Yep, TBH I was coming at it from people not working and did say it needed more money.
If you want to work then you missed the boat years ago or a year ago if you were throwing big bucks around.
But people are still coming over and retiring here so don’t discount it due to Brexit and the news pumping out that your not wanted.
There is housing/cost of living issues here mainly in the islands and big cities where everything’s being bought and Airbnb’d to death to the point that there’s nowhere where the workers can actually afford to rent/buy.
My only advice on housing here is that what you think you want is probably wrong.
ChatGPT is like therapy LOL!!!!
One Very Honest Observation
You’re thinking like someone who wants:
Security for your spouse
Stability for your children
Fairness within the family
And a responsible second half of life
WOW, such insight! 🤣
Wanna know what AI has to say about my stock portfolio?
"your portfolio has grown 14%, indicating moderate risk and low volitility, driven by strong gains in two ETF's*, it emphasises growth with diversified exposure"
Well, no **** Sherlock hahah!
*It's only analysing my two ETF's as that's the only data I've given it, lol
*It's only analysing my two ETF's as that's the only data I've given it, lol
Well, yes, that's all it can do. If you now ask it what your future looks like if you want to retire at 60, with a mortgage due to be paid off at 62, it can start to build a bigger picture.
My only advice on housing here is that what you think you want is probably wrong.
Which begs the quesition what's right?
I was quite taken but a granite house in a Galician fishing village I walked past. Apart from radon gas issues, what's wrong with that?
😉
A bit near the end of the world for most people but there's a supermarket. What's your opinion of these dudofdoom? Not that I'll be buying, too happy in France.
200 000e
https://www.idealista.com/fr/inmueble/99011178/
450 000e
https://www.idealista.com/fr/inmueble/108356088/
Keep dipping into this. I was wondering if anyone had been fortunate enough to "retire" in their 40s.
My wife and I have no kids very little I the way of essential outgoings. Recently spent 3 months unemployed and quoted liked all the bits that weren't stressful job hunting.
I probably wouldn't manage on no days. But I think 3 would be possible. We both did 4 in the past and my wife still does. Sadly jobs like that have been hard for me to find. Easier for my wife now she's joined the ranks of civil service.
Keep dipping into this. I was wondering if anyone had been fortunate enough to "retire" in their 40s.
My wife and I have no kids very little I the way of essential outgoings. Recently spent 3 months unemployed and quoted liked all the bits that weren't stressful job hunting.
I probably wouldn't manage on no days. But I think 3 would be possible. We both did 4 in the past and my wife still does. Sadly jobs like that have been hard for me to find. Easier for my wife now she's joined the ranks of civil service.
I'd be quite happy to drop to 60% of my remuneration package in exchange for working a 3-day week. However, that role simply does not exist!
A bit near the end of the world for most people but there's a supermarket. What's your opinion of these dudofdoom? Not that I'll be buying, too happy in France.
200 000e
https://www.idealista.com/fr/inmueble/99011178/
450 000e
https://www.idealista.com/fr/inmueble/108356088/
It’s too cold, the climates closer to U.K. so your going to need to use the heating more so your not winning on climate, I’d also say for a couple retiring too big.
Also the bang per buck is going to draw U.K. people to buy as they couldn’t dream of having houses like that in the U.K. and they get blinded by how cheap.
I’ve a pellet burner which keeps my house warm on a bag of pellets for 2-3 days and this year I doubt if I used 15 bags at €5-6 and we stopped putting it on about 3 weeks ago so the costs of heating during the winter aren’t particularly frightening although the pellet burners €2.5k.( I bought a known Spanish brand so parts/repairs are possible.
Its currently 20c here and although I’d not be sunbathing on the beach people literally are.it’s cold in the morning lovely during the day and colder at night.
Rightsizing makes all the difference, friends with oil heating and large houses have been crying over their oil costs.
A sensible sized 2 bed house makes more retirement sense and tbh if all the family want to come over then meet up at a nice hotel on the coast for a few weeks for the odd time you need more room.
The other 50 weeks a year you have something that’s reasonable on heating/cooling and upkeep.
Again I’ll iterate it’s not for everyone,if you’ve the money the idea scenario is a house in both countries , treating the U.K. one as investment and not ‘burning your boats’ but that would require a long term strategy and tbh your Brexit benefits count for little when it comes to the high cost of entry that you require for your NLV.