Could I retire next year at 55?

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  • stoozie1
    stoozie1 Posts: 656 Forumite
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    Looks a great position to be in.

    Pob lwc!
    Save 12 k in 2018 challenge member #79
    Target 2018: 24k Jan 2018- £560 April £2670
  • ffacoffipawb
    ffacoffipawb Posts: 3,593 Forumite
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    stoozie1 wrote: »
    Looks a great position to be in.

    Pob lwc!

    Diolch stoozie :)
  • ffacoffipawb
    ffacoffipawb Posts: 3,593 Forumite
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    ams25 wrote: »
    Ps you've done really well to accumulate that level of funds, especially if that salary level is not a big reduction from earlier roles. Any tips on how you've done that. Even if you won the lottery you've resisted spending it all which is great:T.

    I have been paying 50% pension contributions via salary sacrifice for over 10 years, when the mortgage was cleared.

    My gross salary is £60k but I sacrifice half that and we manage OK.
  • ams25
    ams25 Posts: 260 Forumite
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    ffacoffipawb wrote: »
    I have been paying 50% pension contributions via salary sacrifice for over 10 years, when the mortgage was cleared.

    My gross salary is £60k but I sacrifice half that and we manage OK.

    very impressive. you must have a very understanding family... (or you've managed them well!!)

    but sacrifices made, you might find you can now spend more in retirement than when working....(in terms of discretionary spend, I am)
  • dmelife
    dmelife Posts: 133 Forumite
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    No offence or judgement intended (it!!!8217;s a loophole many of us would take advantage of) but you have to ask what kind of system allows someone to become a pension millionaire by sacrificing their salary to the extent that they are then topped up by tax credits? Hopefully UC will close the door on this!
  • ffacoffipawb
    ffacoffipawb Posts: 3,593 Forumite
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    dmelife wrote: »
    No offence or judgement intended (it!!!8217;s a loophole many of us would take advantage of) but you have to ask what kind of system allows someone to become a pension millionaire by sacrificing their salary to the extent that they are then topped up by tax credits? Hopefully UC will close the door on this!

    Could have got close without the tax credits, the latter means I can be retiring a couple of years earlier, so why not?
  • dmelife
    dmelife Posts: 133 Forumite
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    Why not exactly, use the reliefs and loopholes available. This is just a loophole that I don!!!8217;t think should be available!
  • Triumph13
    Triumph13 Posts: 1,730 Forumite
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    If you don't enjoy your job, why on earth are you going to work tomorrow?
    You say you 'need' £2k a month = £24k pa. Well when you're 67 your DBs and SPs and your current S&S ISAs will yield about £33k pa post tax which is nearly 50% more than you say you need. To have that £33k for the next 13 years (for 7 of which your DB will be in payment) will cost about £350k. What are you planning to do with the half a million quid you have spare?
    Hand in your notice and enjoy time with the kids while they're young.
  • ffacoffipawb
    ffacoffipawb Posts: 3,593 Forumite
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    Triumph13 wrote: »
    If you don't enjoy your job, why on earth are you going to work tomorrow?
    You say you 'need' £2k a month = £24k pa. Well when you're 67 your DBs and SPs and your current S&S ISAs will yield about £33k pa post tax which is nearly 50% more than you say you need. To have that £33k for the next 13 years (for 7 of which your DB will be in payment) will cost about £350k. What are you planning to do with the half a million quid you have spare?
    Hand in your notice and enjoy time with the kids while they're young.

    You are probably right, but I am risk averse despite my 100% equity investments. Markets are a bit iffy at the moment so rather put in a bit of extra margin just in case.

    My SIPP is £700k wholly invested in investment trusts and my other pension is £100k in a multi asset fund.

    ISA is also investment trusts, pretty much the same ones as the SIPP.
  • ffacoffipawb
    ffacoffipawb Posts: 3,593 Forumite
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    ffacoffipawb wrote: »
    I think this is possible. But could someone check that I am not missing something.

    Curent monthly requirement is £2,000 net.

    DC pension currently £800k. Still contributing.
    DB of £12,000 in todays money from age 60

    (I realise that I am over LTA with no protection, still contributing as markets may fall)

    Current Salary is £30,000 after pension contributions.

    Current cash
    £37,000 in NSI index linked certificates, both renewed last year
    £30,000 in Premium Bonds
    £10,000 in various savings accounts
    £200,000 in S&S Isa with HL, investment trusts yielding £6,000 which is currently being reinvested.

    Want to avoid LTA charge on DB pension so probably crystallise £500k next year for £125k PCLS.

    Aim to take balance of LTA from DC after taking DB at age 60. Balance over LTA will remain untouched until age 75 or LTA abolishment should the latter happen.

    How does it look? Am I missing something as it looks reasonably doable to me?

    Need to spend £50k from PCLS next year for a new kitchen and bathroom (former is rather dilapidated) and possibly a newish car.

    EDIT: No mortgage as was paid off a few years ago, house worth £250k.

    Also still have 3 children at home, 1 still in Primary School. Wife not in employment.

    Thanks

    Well, 7 weeks on ...

    My £800k SIPP is now £690k
    My £200k ISA is now £170k

    Significantly underperformed the market by using IT's.

    May take PCLS next year at 55 due to LTA issue but retirement postponed for another 2 years as I don't feel I have enough 'fat' in my investments to cover lean years.

    Also there is a risk of a Corbyn government which may postpone retirement permanently. The current rout is nothing compared with the carnage he will cause.
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