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So a hearty discussion ensued last night ... scenario was
"Imagine you win £1M on the lottery, is that enough to retire happily for you and partner?"
(assuming no private pension, no mortgage, assume 60).
Argument developed around inflation in the future, is it invested, just in a savings account etc!!
Clearly none of us have a clue! So out of interest, how would it pan out?
Definitely, but not if you want a couple of flash cars, flash house etc. If you didn't touch the capital, it's possible to manage on it - you won't be loaded - 5% would get you £50k a year (pre tax etc). But you could top that up by drawing it down, assuming you didn't want to leave any. £50k a year would last you 20 years. This is also assuming no growth.
Interest and drawdown should be nice and comfy for 10years, then wind it back in ! Few £k to kids to set them up.
At age 60 - I`d say absolutely.
At 60 your spendings will typically decrease steadily over the next decade as holidays and hobbies get cheaper. The fancy toys/bike will get less important and the holidays less important.
Then from 70 to 80 a bit more dramatically. The car may go - health may dictate holidays and hobbies.
Its a depressing thought, but whilst our life span may be 82yrs - our health span is 62yrs. So emphasis should be on finishing no later than 60 for everyone.
Christ yes!
Depends if you have expensive tastes or not I guess... I find that we all pretty much live to our means, and if that's a £12k annual UK state pension or 100x that as a high flying city trader, you'll end up spending it! So learning to live within your means and be happy with your lot is essential...
Personally, I've got quite a big mortgage with about £325k left, so would pay that off instantly... Which would leave me and my GF with around £675k left... £675k in a 4% return investment is £27k a year (so basically, a bit more than 2 state pensions), our monthly outgoings on bills (excluding mortgage) is around £1000-1200 per month (leccy, gas, water, council tax, food etc.) between us, so it's possible...
I imagine my GF wouldn't want to fully retire, but her current job, she could easily do it as a self employed contractor and pick and choose what she did... I've just been looking at jobs I could do 4 days a week anyway recently, one of which has really piqued my interest given my skill set (motorcycle instructor) and I could easily do this either pro-rata salaried working for an instructor school, or could pick and choose what I did self employed if I wanted to as required... I imagine we'd probably both end up averaging a couple of days work a week (probably bringing in around £800 per week before tax) and spend more time travelling, cycling, enjoying each others' company etc.
We're both 45 by the way... At 60 I'd actually spend some of the capital too, as I'd be able to get my state pension in a few years anyway...
No point in being the richest person in the graveyard! I have a friend whose business has made him a multi millionaire over the last few years, and whilst he absolutely can't wait to retire (he's 62), despite the fact he doesn't have particularly expensive tastes he just can't turn the money down that is being thrown at him... His work stresses him out massively and he can't wait to retire, yet despite this and millions in the bank, he still won't call it quits! 🤷🏻♂️
is that enough to retire happily for you and partner?
Define "happily?" Are we both happy? Is one of us happy, but the other not completely happy?
Of course it would be enough! Don't forget that, at state retirement age, you'll still get your state pension on top too.
Have a look at the early retirement, how much money thread….
The general consensus there for same age and mortgage criteria is probably about £500k as a couple’s pension pot, some less..
Assuming you'd have to pay off a mortgage and you're remaining mortgage is under, say, £350k, the remainder could definitely fund a very comfortable, but probably not lavish (albeit people's definitions of those terms will differ, obvs) retirement from age 60.
Speaking personally, I'm 51, and if I won £1m tonight I would hand my notice in on Monday.
£1 million would allow me to retire and take off into the sunset tomorrow, even half that in those circumstance would be great.
1 million is plenty, 1 million if you already have a mortgage-free house and no young dependent children is loads.
Sure if you "need" a new car every 3 years (and another one for your spouse!), and have several additional expensive habits like golfing, luxury cruises, and yachts, you could probably spend it all before you die, but no normal person would have a problem living on it.
You'll fine some folks will just blow a chunk, flash cars etc - easily done. If you want to pack in the day job, but live comfortably, and maybe do something you want, then it's very possible. You'd never need to worry about the boiler packing in. The retirement thread is very good - I've made some decisions as I've hit 55.
certainly. I would quit and never work again
Thanks all ...looks like my pitch was in line.
I'd proposed putting the £1m into a savings account, then at 4% that's 40k per year. Inflation won't erode that too much in the near future, and then when it does, my spending would be less as I'm older, and I can always make withdrawals from the capital.
Now I just need to enter the lottery!
I'm 43, and if I won a million quid I sure as hell wouldn't be working in my current role anymore, maybe not retired, but certainly part time.
Don't forget that, at state retirement age, you'll still get your state pension on top too.
No you wouldn’t . If you don’t pay NI it reduces your ability to get state pension
”To get any State Pension, you need at least 10 qualifying years, and to get the full amount, you need 35”
Maybe in your 50’s/60’s I’d consider it but not in younger years. I don’t think it leaves you with much to do in all this free time you would have on your hands
That's my thinking on part-time, I've got 8 years fte to go to get my full state pension. And it'd let me have the time to turn my hobby of restoring classic motorbikes into something I could get paid for without having to worry about my hourly rate.
Buying an annuity with a million quid would give you £5k a month for life - so yes, no more work
Easily unless you want to be going on 5* holidays twice a year etc. You might have to get used to driving 5 year old Fords rather than getting a brand new 5 series bimmer every 3 years.
Use your ISA allowance, anything in there is tax free.... You can only put 20k per year in, but you can max it out every year by transferring money from your normal savings account
Now I just need to enter the lottery!
I was supposed to win £113m on the EuroMillions last night, I bought a ticket and everything. Unfortunately, there's a petty little rule that the numbers on the ticket have to match the numbers that fall out of the machine and well... mine didn't. Clearly some kind of admin error.
With £1m, it's either a lot (if you're already 60ish, own your home, have some savings, no dependants - kids have grown up, parents have died etc) or it's not a lot at all (if you don't own a home, have dependants - either kids in uni or elderly parents in a care home etc).
Yes , Absolutely .
With that amount you could afford to pay a financial advisor who could steer you in the right direction to make it last and at least keep the capital amount whilst you spend the interest or dividends .
No need for any more money than that unless you are greedy and want to live a life you have dreamed of, for whatever reason. As soon as you start high rolling you will quickly move in circles where people have way more money than that ,and more always seems to arriiving in wheelbarrow loads every month for most of them. Boats , private jet hire , Holidays , Holiday homes will burn through that in months.
Me. I would be gone . Sell everything then take time to work out where I stand with existing pensions and probably buy a small boat and disappear for 6 months of the year. I could live for 30+ years on more income than I have ever earned. I dont even think I would take a part time job , unless it was ski guiding or a similar lifestyle gig where you get paid to do something you love and would be doing it anyway eg skippering a boat.
EDIT .- I would also retire if I got 1/10th of that amount. But that would require a very part time 2 day a week job and no boat. But no more full time work. Not A Chance . But thats just me , my ability to live frugally and wanting to stop the daily grind while I can still do all the things I like for years to come . Not work till my body is broken and decrepid and all i can is sit in a chair and watch cash in the atttic wishing I had retired 10 years earlier.
That's fifty grand a year for 20 years, I think I'd spend it and then die.
Depends whether you're planning on leaving £1M behind you or not I suppose.
A million quids worth of coke and hookers might last you a life time, if you go at it hard enough
As soon as you start high rolling you will quickly move in circles where people have way more money than that
I think there's an idea of a "millionaires lifestyle" which, perversely, you couldn't afford if you had a million quid. But having a million quid, mortgage free at 60 you'd be able to retire and be far far more comfortable than most of your peers.
A million quids worth of coke and hookers might last you a life time, if you go at it hard enough
It'd be a fun week though, regardless!
Depends whether you're planning on leaving £1M behind you or not I suppose.
Very good point to be fair... I've got nobody to leave it to! 🤔
EDIT .- I would also retire if I got 1/10th of that amount. But that would require a very part time 2 day a week job and no boat. But no more full time work. Not A Chance . But thats just me , my ability to live frugally and wanting to stop the daily grind while I can still do all the things I like for years to come . Not work till my body is broken and decrepid and all i can is sit in a chair and watch cash in the atttic wishing I had retired 10 years earlier.
There with you on that... Recently been doing the sums on this myself... My GF loves her job, and she's lucky enough to get 33 days a year holiday too (and the option to buy another 10 if she wanted to)... If I got £100k tomorrow, I'd pay £90k off the mortgage as soon as it's up for renewal (Feb 2026), spend £10k on a van, start fixing bikes again (though this time in my own garage and offer a drop off and collection service) for maybe 20hrs a week on average and spend the rest of my time riding and/or enjoying it with my GF when she's on her extended holiday time... Then probably look to downsize our current house in 5yrs when it's probably worth £650k (worth about £500k now) by which point we'd have £400k equity in it so would buy something outright for that much and at 50 and mortgage free, we would both have a huge freedom of choice in front of us as to how we spent our remaining years on the planet!
Isn't disappointed with C&H comments.
But, yeh, - 1 Million today and you wouldn't see me for a dust shaped aide shape id be off that quick.
Read a while ago that to enjoy the millionaire lifestyle you needed £5m these days.
I'm 56, MrsMC 54. Both can claim work pensions with no penalty at 60.
We could obviously easily quit with £1m between us. We could probably manage separately, to be fair 🤔
lucky enough to get 33 days a year holiday too
This isn't that unusual is it? A couple of days more than I get but it certainly doesn't give me 'extended holiday time'. 6 weeks spread over a year. I take 2 weeks off once a year, 1 week 2 or 3 times then random days scattered about.
As to the question, it is more than I will likely earn between now (46) and planned retirement. Instant resign on Monday.
My wife’s cousin won £1M on a scratch card.. and kept working..
I'm 52, with a modest mortgage only a couple more years to pay. £1m now would see me telling my employer they've got 3 more years from me, and then I'm gone....£1m + current pension + 3 years interest would get me modest draw down initially then around £45k a year for the rest of my life, with state pension added in a few years... That would get me a nice self-build house on Speyside, a nice bike, a reliable cheap car...
My wife’s cousin won £1M on a scratch card.. and kept working..
I worked beside someone that won £2M on the Lottery.
He tried to keep it secret for a long time and carried on working.
He was a nice person ,but I think he (and his family) found it hard to manage the change, and possibly got bad (or the wrong) advice.
Ended up having a bit of a breakdown, which was sad as he had always loved his job.
That would get me a nice self-build house on Speyside, a nice bike, a reliable cheap car...
I think that's where a lot of people screw up. They think "WOW, a million quid!" and before they know it they've blown the lot on a couple of flash cars and other expensive tat.
I agree with you - decent stuff but nothing £££
£1M is £40k a year for 25 years. £1M at 4% is also 40k so I could do the maths but my spreadsheet would be £1M in a high return investment, then draw down capital plus return for 25 years to a goal of not quite zero, and leave a bit for the end
Based on the OPs premise that you have no mortgage, and now no need to save, all that cash is there to have fun with.
I'm absolutely retiring at 60 on that without a second thought.
work stresses him out massively and he can't wait to retire, yet despite this and millions in the bank, he still won't call it quits!
How much is enough, just a little bit more 🙂
Even at 500k I'd be checking out of the rat race.
I quite probably wouldn't give up work. But I'd give up what I currently do but I'd scale my lifestyle accordingly
I'm not 40 yet.
I'd be at least be able to help my new friend, whose a prince in Nigeria, out of the predicament he's gotten himself into.
But more seriously my mate at 48 got that much from a share save scheme from the oil company he worked for and retired. Met someone, got married and now getting divorced. He's back working again.
This isn't that unusual is it?
33 days holiday per year is becoming increasingly common, but it is still a long way from the norm... I think the UK average is still around 25 days paid holiday per year.
How much is enough, just a little bit more
Quite! I did try to tell him that... He can't even spend it as quickly as he earns it, no matter how hard he tries... He wants to retire to Portugal or Spain on a Golden Visa he says... He could have done that years ago, and already be living the high life drawing down on his millions in the bank! Hey ho. I guess when he does finally go, he's going to be able to afford some bloody house out there (he wants to live up in the Mountains, not down on the Algarve)... I'll look forward to going and visiting him!
Read a while ago that to enjoy the millionaire lifestyle you needed £5m these days.
I don't want a millionaire's lifestyle... I want a student's lifestyle, but without the debt!
£45k a year for the rest of my life, with state pension added in a few years... That would get me a nice self-build house on Speyside, a nice bike, a reliable cheap car...
£45k a year with no mortgage is a serious chunk of money! Add the state pension on top and you've started looking for things to spend it on... The nice bike and cheap reliable car have become several nice bikes and a luxury car that you don't need... Once you fall into the trap of spending just a bit more, it's hard to get out of it... I honestly believe that I'm happiest when my incomings aren't significantly more than my outgoings, because it makes me be a little more cautious with my spending and value the few luxuries I afford myself more than when I have say 50% of my salary free every month to spend as I see fit... The biggest oppressor is systemic debt, and the absence of debt is FAR more liberating than the ability to spend a significant proportion of your salary each month on stuff that ultimately doesn't ease the pain!
He wants to retire to Portugal or Spain on a Golden Visa he says
No more golden visas in Spain now, but tbh if your not working you don’t need one and a non-lucrative-visa would be fine (although you do have to spend more time in Spain)
Brexit has made It harder for people as you have to show more way more income but it’s still viable to come here without a million squid.
tbh I always thought if you were going to live in a caravan park you may as well live in one in Spain 🙂
It brings other issues with it thou ,all your m8s are probably U.K. side and they may not be rushing to book flights to visit you.
Buying an annuity with a million quid would give you £5k a month for
…before tax. And inflation will cut its spending value year on year making it worth ~30% less in 10 years’ time if we treat that like 2015->2025. An indexed annuity would pay out less, say £2,750/month to start, but rise to avoid falling behind inflation as quickly.
but, yeah, £1,000,000 could be a fair sum for many folks to live on for the rest of your life if used appropriately. At age 60 I’d go for it.
Forget the big win, what about the winter fuel payment. Would you still get that?
I'm surprised.... It appears I'm the only person on this thread with kids [ that cares about them]
I was supposed to win £113m on the EuroMillions last night, I bought a ticket and everything. Unfortunately, there's a petty little rule that the numbers on the ticket have to match the numbers that fall out of the machine and well... mine didn't. Clearly some kind of admin error.
My local shop sells 'unlucky dips' - lottery tickets that he guarantees will not win the jackpot. If one turns out to be faulty and you win big he'll refund your £1.50
In the original post the age of winning was 60. How many of us would earn £1M in the 5-8 years before retiring? Not me for certain.
I am currently 56 with mortgage paid off and youngest still at university. I really enjoy my job so would probably work until 60 and then possibly retire if I was fortunate enough to win £1M.
Buying an annuity with a million quid would give you £5k a month for
£5k a month is not dreadful though is it, combined with another £1k a month at 67 plus any other pensions a £1MM winner may have could be looking at £6-7K per month easily. If you can't live on that then presumably you are currently earning more than that per month...