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    • frugal90
    • By frugal90 10th May 15, 6:31 AM
    • 229Posts
    • 115Thanks
    3,4 or 5 year journey to financial freedom
    • #1
    • 10th May 15, 6:31 AM
    3,4 or 5 year journey to financial freedom 10th May 15 at 6:31 AM
    Anyone in the same boat please share your steps. Maybe we can help motivate, share good ideas to get to our targets.

    Me and spouse will retire ( we hope) in 2018/19 or 20. I will be 56/57 or 58 and wife will be50/51 or 52. We aim to use sipps/isas/savings to cover until I am 60 when my public service pension will start. My wife will also take her public service pension when 60. I will have 36.5/37.5 or 38.5 years in an 1/80 th scheme, so will get 36.5/80 x salary currently 42k +3xpension as tax free lump. Mrs will have 26.5/80 x42k + 3x pension tax free lump.

    We have no debts and achieving financial freedom has become number one aim. We have a target of 400k for Sipps/isas and currently have about 270k mostly in equities. Our plan is to save 2.5k per month if not more into sipps/isas and once we hit 400k we,'ll bail out. We plan to be seriously frugal to achieve our aim. We don't have an expensive lifestyle, enjoy the best free things in life but need more time. We plan to cycle tour/walk/ garden etc

    If you want to join us on our journey and have similar timescales the please join us.

Page 5
    • atush
    • By atush 20th May 17, 11:04 AM
    • 16,386 Posts
    • 10,139 Thanks
    Sounds great.
    • k6chris
    • By k6chris 21st May 17, 7:07 PM
    • 151 Posts
    • 232 Thanks
    I think, as the young people say, "JFDI"...

    Good luck!
    • jerrysimon
    • By jerrysimon 22nd May 17, 8:19 AM
    • 251 Posts
    • 185 Thanks
    I think, as the young people say, "JFDI"...

    Good luck!
    Originally posted by k6chris
    That's the route I went down end of March this year aged 56

    Waiting for my second monthly pension paymemnt. Its important to look at net monthly income as much as pension annual salary. No pension or NI payments anymore. I took the hit on taking my DB pension early.

    My current feeling is thank God I did not wait!

    PS our figures are lower than yours. We are mortage/debt free with 60K of savings and a net income of 1500/month.

    Last edited by jerrysimon; 22-05-2017 at 8:24 AM.
  • jamesd
    quick update ... feeling good about things at the moment and the fact I now have choice
    Originally posted by frugal90
    Worth a look at Ablrate P2P when their ISA launches in early to mid June. Around 10% after allowing a couple of percent for bad debt should be very competitive with ITs.

    80k in cash bugs me when I know it could be generating 1Ok a year of income in say MoneyThing, again after allowing for bad debt. From the cash and IT pots combined I'd be looking to get £30k of income a year at the moment. I'd also look to take the as free lump sums from the SIPPs now to use for additional income generation, potentially another £3.5-4k a year.

    Though given your future income from DB pensions quite rapid drawing to sustain your income at a high level from retiring to reaching normal pension age for those DB pensions looks like a good move.

    From the look of it you'll have around £37k in DB plus a pair of state pensions at say 8k each for a total of £53k of guaranteed income.

    P2P without capital drawing seems to have about £34k of potential a year with SIPP tax free lump sums included. That's an initial shortfall of about £19k a year but it looks as though the taxable 75% of the SIPPs can bridge that.

    So retiring now - well, end of August 2017 - on £53k+ of income looks entirely reasonable to me if you want to do it.
    Last edited by jamesd; 22-05-2017 at 8:45 AM.
    • LadyTC
    • By LadyTC 22nd May 17, 4:05 PM
    • 10 Posts
    • 16 Thanks

    I have just posted for the first time in the mortgage thread because I have been advised by a family member to increase my pension contributions rather than pay down my mortgage due to my very low mortgage rate/higher tax relief. Myself (56) and my partner (55) hope to both pack up at lest full-time work in 5 years time and like Frugal90 we want to do more travelling - particularly around the UK.

    The same family member has recommended that I sign up with Retireeasy to do some lifetime planning and it costs £3 per month which is pretty low. Has anyone on here used Retireeasy and it is any good, worth the money etc? Are there any similar tools out there - I can't find any on google.

    I'd prefer to DIY rather than have the expense of an adviser if I could find a decent online tool.

    Grateful for any help.

    Lady T
    • atush
    • By atush 22nd May 17, 8:27 PM
    • 16,386 Posts
    • 10,139 Thanks
    Hi Lady T,

    Start your own thread for the most/best replies.
  • jamesd
    The initial advice you received was good. At 55 you're both in a position where you can pay into pay into pensions, get the tax relief then soon after take out the 25% tax free lump sum, leaving the rest for later. Provided you can afford it ths gives you the potential to save the income tax on much of your pay.

    It's particularly foolish for a 55 year old or older to directly pay off a mortgage without first putting the money in a pension.

    If you can't afford to pay in your whole pay it's entirely possible that we will suggest withdrawing your past overpayments so you can undo the harm you've done to your finances by not using the pension pay in first.
    • frugal90
    • By frugal90 4th Oct 17, 4:46 PM
    • 229 Posts
    • 115 Thanks
    quick update again

    definetely enjoying work more this year knowing that I could pack it in anytime- going to enjoy the run in to next summer.

    My ISA £111K income generating ITs
    Spouse ISA £128K income generating ITs

    total £239K

    My SIPP (Cash) £70.5 K to be draw over 3 years until age 60 - £23 500 small tax liability as no other income

    My wife's SIPP(Cash) £84K to be drawn over 5 years

    Cash holding - atom/NSI/bank 123 £86 500

    Retirement date June 30th 2018 -

    Teachers pension kicks in May 2022 - £20.5 k per year plus £61.5 K lump

    Spouse Pension Kick in July 2028 - £16.3 K per year plus £45k lump- now going to take the career average bit at 60

    Total ISAS/SIPP/Cash= £480K

    State pensions both when we hit 67 at the moment

    regards to all

    • robin61
    • By robin61 4th Oct 17, 5:17 PM
    • 571 Posts
    • 447 Thanks

    definetely enjoying work more this year knowing that I could pack it in anytime- going to enjoy the run in to next summer.
    Originally posted by frugal90
    Nice to see your plans are doing well. It does take a bit of the pressure off when you know that you have the choice whether to be there or not.
    Last edited by robin61; 04-10-2017 at 5:19 PM.
    The problem with socialism is that you eventually run out of other people's money.
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