Financial Fate - Are you in control or being controlled?

Conrad

If I sold some assets I could clear the mortgage and have some in the Bank, but do I feel in control? Not really.
I have a morbid focus on building a substantial retirement pot and am far from achieveing that.
I dont consider down sizing as part of my retirment plan.

Dithering_Dad

Conrad wrote: »

If I sold some assets I could clear the mortgage and have some in the Bank, but do I feel in control? Not really.
I have a morbid focus on building a substantial retirement pot and am far from achieveing that.
I dont consider down sizing as part of my retirment plan.

Hi Conrad. I also have a morbid focus on my pension pot. Out of interest, what do you consider 'substantial'?

My own aims were to build my traditional pension pot up to £300k, but I've since had second thoughts and I'm putting more of a focus on building up my missus's pension pot to match my current amount and putting the rest into ISAs.

I based my new approach on the fact that we get an age-related tax-free allowance of £10k, but this is kinda 'means-tested' and reduces back down to the normal £5k tax-free allowance if your pension income is too high. Instead I will use the £10k tax free allowances for both me and Mrs Dither and then have the remaining retirement income in S&S ISAs. This means that we could have in excess of £30k pa retirement income that is totally tax free.

Work smart, not hard.

Conrad

DD

I would think enough to generate an after tax disposable retirment income of £1000 per week. With no mortgage that would be plenty.

I decided against pensions some years back as I wish to leave everything to my children and couldn't bare the thought of saving all those years then dieing soon after retirment and the whole pot going to the annuity provider.

An alternative I'm pondering seriously is to pay off the mortgage and be left with a goodly sum to start a new business in 3 or 5 years, and just live off that long term instead of plodding on in mortgages whilst investing. There are people I know that are semi retired but still own a business and do very nicely. I have a very exacting personality type (doesn't apply to my grammar though) which I think can be harnessed to good effect in such business's as an ethno cafe, as it is attention to detail that makes or breaks a food joint IMO (does it smell fresh or of yesterdays oil, are the walls clean - not just the floor, is the food hot, is the lettuce limp, are the light bulbs dusted, is fridge and litchen spotless - even the tops of unseen cupboards - even those dangling phone wires, is the tapas as fresh and authentic as possible, is the fish fresh, are the tables spotless). Would look to establish in a wealthy area - ladies do lunch and all that.
Chap I know does this and makes a lot of money.

Dithering_Dad

Would you need £52k pa to maintain your current lifestyle?

I worked out that £30kpa based on current monetary values and given that we would be mortgage free, not have any work related costs (i.e. commuting, lunches, clothing, etc.) and the children would be 'off the books', would give us a very comfortable retirement.

I know that in some repects the phrase 'the more the merrier' could be applied to retirement income, but I baulk at putting too much away if it means that my pre-retirement lifestyle is impacted, or indeed if it means that I work so hard that I have a shorter retirment lifespan.

I'm not sure about having any sort of work after retirement, I really just want to have a 7 day weekend.

Pobby

Spot on DD. That`s exactly the figure we shooting for. Tbh that would be, at todays money, loads. Right now it is not that much less than we earn and we make very good savings. I suppose not having a mortgage is a huge saving and allows us to wind down a bit on work.

You have to remember the extra tax free allowance as well. Very useful.

Again, that figure is based on the projection that we had this last year from our pension funds. Clearly the market has moved. However we are hoping for something of a recovery by the time we draw it.

Hoping to see a bit of a boost also coming from our non pension savings and investments as they are already tax paid.

Conrad

DD

Yes, £30000 would be okish, and as you rightly point out, putting too much away can be derimental to long term health. A fine balance.
I too would rather not work in retirment (too many hobbies + volunatry wildlife work for a start), but possibly could put up with a business owned, but run by others with part time input by me.

fc123

We have always lived and worked through problems that had nothing to do with us but that impacted our business severely.
Financial insecurity in my sector as a small trader has always been great.

Our sector has had price deflation for years. If I had known that 25 years ago, I would have done something else instead... Every year prices went down but costs to trade increased.
Increased volumes (fast fashion trend etc) masked the deflation somewhat.
Now the volumes have been killed off by the downturn in consumer spending and we are left the low prices ( + customer expectations of low prices).

All the changes over the years affect us in some way...the internet being the biggest, I believe.

Looking at our situation harshly, I would say we are in a better situation, financially than we were 4 years ago but we have got to try and cut some arms off (business ones) and move forward.

I had my Taleb lucky moment a few months back and grabbed it.
Got to maximise it for as long as it lasts.

Our shop LL seems to be living in another world....they have just informed us that they will no longer accept monthly rents from their tenants from Dec25th. We have been on monthly for 6 months.

Our premises need to be used as a Ye Olde Tea Shoppe type of place now.


We are working through the list of possible solutions right now, but crunch or not, I believe we would have had some of these problems anyway.

Our business model has changed. It's not what we sell that is the problem, but how we get it to the customer in a profitable way.


In the end, the only thing I have is a head full of ideas ....and the ability to turn the ideas into products plus the ability to find customers who want to buy them.


One 'Worst case' is we end up running a tea shoppe just to keep the landlord paid....the thought of it sends me into depression.:(

The main difference the crunch has made is I am not alone.

I have lived through a decade seeing long established, really good suppliers (textiles / clothing) and stores shut down due to the cheap imports and the cloning of shopping areas.

Pobby

fc123 wrote: »

We have always lived and worked through problems that had nothing to do with us but that impacted our business severely.
Financial insecurity in my sector as a small trader has always been great.

Our sector has had price deflation for years. If I had known that 25 years ago, I would have done something else instead... Every year prices went down but costs to trade increased.
Increased volumes (fast fashion trend etc) masked the deflation somewhat.
Now the volumes have been killed off by the downturn in consumer spending and we are left the low prices ( + customer expectations of low prices).

All the changes over the years affect us in some way...the internet being the biggest, I believe.

Looking at our situation harshly, I would say we are in a better situation, financially than we were 4 years ago but we have got to try and cut some arms off (business ones) and move forward.

I had my Taleb lucky moment a few months back and grabbed it.
Got to maximise it for as long as it lasts.

Our shop LL seems to be living in another world....they have just informed us that they will no longer accept monthly rents from their tenants from Dec25th. We have been on monthly for 6 months.

Our premises need to be used as a Ye Olde Tea Shoppe type of place now.


We are working through the list of possible solutions right now, but crunch or not, I believe we would have had some of these problems anyway.

Our business model has changed. It's not what we sell that is the problem, but how we get it to the customer in a profitable way.


In the end, the only thing I have is a head full of ideas ....and the ability to turn the ideas into products plus the ability to find customers who want to buy them.


One 'Worst case' is we end up running a tea shoppe just to keep the landlord paid....the thought of it sends me into depression.:(

The main difference the crunch has made is I am not alone.

I have lived through a decade seeing long established, really good suppliers (textiles / clothing) and stores shut down due to the cheap imports and the cloning of shopping areas.

Wow, I really do sympathise. Been an owner of a shop some time back and did so for many years. By and large shop landlords are really hard to deal with. Some are lucky but a lot of retailers I talk to have had bad experience.

Our specialist shop would have been hard for him to re-let so each time he tried to increase the rent we threatened to go under.

Internet. Don`t start me on that. Suppliers. Often living in ivory towers or dripping in a lack of integrity. Again, we had some really good ones.

General public. OK let`s put it this way. I`m a big dude and when my wife and a member of staff had to try and over power me from punching out some muppet of a customers lights we realised it was time to throw it all in.

Never, ever again!

fc123

Pobby wrote: »

Wow, I really do sympathise. Been an owner of a shop some time back and did so for many years. By and large shop landlords are really hard to deal with. Some are lucky but a lot of retailers I talk to have had bad experience.

Our specialist shop would have been hard for him to re-let so each time he tried to increase the rent we threatened to go under.

Internet. Don`t start me on that. Suppliers. Often living in ivory towers or dripping in a lack of integrity. Again, we had some really good ones.

General public. OK let`s put it this way. I`m a big dude and when my wife and a member of staff had to try and over power me from punching out some muppet of a customers lights we realised it was time to throw it all in.

Never, ever again!

The whole internet thing is going to be massive wake up call to all those comfy commercial property companies.....though, one could argue shopping online has been around for years, it is only now that is kicking fully into the mainstream. Broadband in peoples homes is more the norm now.

My mother is 70, doesn't do anything online, not even e-mail but gets her partner to shop online on her behalf...all the catfood for example.

So, with my Taleb moment, I am selling on one of the ''premier''sites in my sector......and I have an inbox full of enquiries, people even send me pics of themselves in my stuff, but it's how I move forward from this opening that really counts.
I could be dropped next month, the style I am currently pursueing could be 'Primarked' within 6 months...but that's just how it is.


We've had staff beaten up by customers in the past and, I confess, OH did offer a guy to outside over a row about a scammy return (she wore it for the event, then damaged it on purpose and then wanted a refund).


Our area has changed and our premises need to change use...a more experience led type business for visitors.

If we put all 3 businesses in 1 pot, it still adds up fine (the downturn on one part topped up with another) BUT I love what I am doing now and I have really done my time with greedy landlords, medeiaval leases and some of the general public.

Conrad

fc123 wrote: »

One 'Worst case' is we end up running a tea shoppe just to keep the landlord paid....the thought of it sends me into depression.:(

I quite like the idea! Make it the best damn tea shop that ever lived, because there are sooo many coffee shops now. Delivering the best is an art at which many fail IMO. Gonna have to be spotless, with great grub.