Pensions Planning: The NUMBER

robatwork

MallyGirl said:

Indeed. I yearn for the days when I am not awake at 5am thinking through some issue going on at work.

Work is, by and large, being paid to take on someone else's stress. At least that's my view and experience. If you're lucky enough to be in a job you enjoy and doesn't stress you to a large extent, then you're in a tiny but lucky minority.

No wonder so many retirees on this thread and forum find a weight lifted when they push the R button.

pterri

robatwork said:

MallyGirl said:

Indeed. I yearn for the days when I am not awake at 5am thinking through some issue going on at work.

Work is, by and large, being paid to take on someone else's stress. At least that's my view and experience. If you're lucky enough to be in a job you enjoy and doesn't stress you to a large extent, then you're in a tiny but lucky minority.

No wonder so many retirees on this thread and forum find a weight lifted when they push the R button.

The last year up has been really stressful, not because it actually is but because I’m close to not having to accept it. I thought I’d be less stressed! I think it will subside when I’m at or close to handing in my notice. I work with a nice bunch actually but I’m done with accepting that 9-5 and stress is what I’m prepared to accept, luckily I’ve got a fairly robust plan and funds in place. I want to hold on until 57 (july 25) but in reality I could go now. 

Cus

MallyGirl said:

Indeed. I yearn for the days when I am not awake at 5am thinking through some issue going on at work.

I found that this pattern of thinking became so ingrained in me that when I stopped work, some non work thought replaced the work thought at 5am. Takes time to reprogram yourself.

Time4T_Accounts

MallyGirl said:

Indeed. I yearn for the days when I am not awake at 5am thinking through some issue going on at work.

I absolutely get that. Now, after pressing the R button 6 years ago, I do 3 or 4 days consultancy for some months of the year : it beats sudoku for keeping the brain sharp, and,given that it was never part of the number in the first place, provides rather nice cherries and icing! And the 5am stuff is for other people now, not me!

cfw1994

kimwp said:

LHW99 said:

Never in my life have I planned for or lived around ‘a number’ but ‘the number’ has impacted how I do things.

I agree, my point was that blissfully jumping because you may be fed up with a job may well take you through to 75 or so, but will you be fit enough at that age to take on shelf stacking etc? Would you cope with the upheaval of downsizing, or release sufficient money from it?

I have never had a "number" in terms of pot size, but have always had some idea of the income I need to continue living at a standard that I judge adequate (for me). Once you have that "FU" amount, everything else is the jam, cream and icing.

How do you know you have enough for that income?

Unless you have guaranteed income from SP or DB pensions schemes, this is hard to guarantee.
Broadly speaking, you should be okay taking 3-4% pa from a given DC pot (eg £3-4K each year for every £100K in the pot).  Sample reasoning here.

That said, people often have different schemes kicking in over the years from 60-67.  Between us, we have 3 s our State Pensions.

The answer for me was to model a spreadsheet with the years on the left and the income streams in columns, kicking in for us until I hit 67.

From that point, my DC pot (& our other ISA savings) will have relatively little to do, so we can figure out the years to that point.  

Sure, there are unknowns…inflation, market crashes, etc…..but having some flexibility in your attitude will help.  

kimwp

cfw1994 said:

kimwp said:

LHW99 said:

Never in my life have I planned for or lived around ‘a number’ but ‘the number’ has impacted how I do things.

I agree, my point was that blissfully jumping because you may be fed up with a job may well take you through to 75 or so, but will you be fit enough at that age to take on shelf stacking etc? Would you cope with the upheaval of downsizing, or release sufficient money from it?

I have never had a "number" in terms of pot size, but have always had some idea of the income I need to continue living at a standard that I judge adequate (for me). Once you have that "FU" amount, everything else is the jam, cream and icing.

How do you know you have enough for that income?

Unless you have guaranteed income from SP or DB pensions schemes, this is hard to guarantee.
Broadly speaking, you should be okay taking 3-4% pa from a given DC pot (eg £3-4K each year for every £100K in the pot).  Sample reasoning here.

That said, people often have different schemes kicking in over the years from 60-67.  Between us, we have 3 s our State Pensions.

The answer for me was to model a spreadsheet with the years on the left and the income streams in columns, kicking in for us until I hit 67.

From that point, my DC pot (& our other ISA savings) will have relatively little to do, so we can figure out the years to that point.  

Sure, there are unknowns…inflation, market crashes, etc…..but having some flexibility in your attitude will help.  

Thank you @cfw. I was using 3%, but then piling on conservatism- planning for 5k more than I spend today, no state pension, assuming no growth in the pot until I get to pension age. Trying to dial back on that, so always interested to see what assumptions others are making.

cfw1994

One thing I was very aware: every year you put off retiring is one healthy year less *in* retirement.  

DT2001

kimwp said:

cfw1994 said:

kimwp said:

LHW99 said:

Never in my life have I planned for or lived around ‘a number’ but ‘the number’ has impacted how I do things.

I agree, my point was that blissfully jumping because you may be fed up with a job may well take you through to 75 or so, but will you be fit enough at that age to take on shelf stacking etc? Would you cope with the upheaval of downsizing, or release sufficient money from it?

I have never had a "number" in terms of pot size, but have always had some idea of the income I need to continue living at a standard that I judge adequate (for me). Once you have that "FU" amount, everything else is the jam, cream and icing.

How do you know you have enough for that income?

Unless you have guaranteed income from SP or DB pensions schemes, this is hard to guarantee.
Broadly speaking, you should be okay taking 3-4% pa from a given DC pot (eg £3-4K each year for every £100K in the pot).  Sample reasoning here.

That said, people often have different schemes kicking in over the years from 60-67.  Between us, we have 3 s our State Pensions.

The answer for me was to model a spreadsheet with the years on the left and the income streams in columns, kicking in for us until I hit 67.

From that point, my DC pot (& our other ISA savings) will have relatively little to do, so we can figure out the years to that point.  

Sure, there are unknowns…inflation, market crashes, etc…..but having some flexibility in your attitude will help.  

Thank you @cfw. I was using 3%, but then piling on conservatism- planning for 5k more than I spend today, no state pension, assuming no growth in the pot until I get to pension age. Trying to dial back on that, so always interested to see what assumptions others are making.

I understand your thought process and originally I looked at the plan in a similar way however helping my mother for 20 years after she was widowed opened my eyes to a number of factors. She lived off less than the SP (with the caveat that an occasional larger repair could come out of her small capital pot - £50k). She did all she wanted and the 2/3 years before needing care added to her capital pot. At 85 she downsized to a retirement flat which funded her increasing care costs. My point is that we need to look at the overall picture and see if the worst happens (remember statistically you will end up with more in your pot than you started with) we have a plan - maybe downsizing, adjusting spending in the short term etc.

We haven’t stuck to that plan as OH enjoys work and is lucky to be self employed with flexible contracts however the stress levels are lower knowing whatever happens we have a plan (even if it needs tweaking).

dont_use_vistaprint

robatwork said:

MallyGirl said:

Indeed. I yearn for the days when I am not awake at 5am thinking through some issue going on at work.

Work is, by and large, being paid to take on someone else's stress. At least that's my view and experience. If you're lucky enough to be in a job you enjoy and doesn't stress you to a large extent, then you're in a tiny but lucky minority.

No wonder so many retirees on this thread and forum find a weight lifted when they push the R button.

It’s hard to explain, total release. I always enjoyed work, but came to the conclusion I’ve worked enough and at 53 decided I want a couple of decades for me before I’m too old to properly enjoy it.

I llove my days now I have a good long sleep every night, a lazy morning, make fresh juices, swim in the pool on the roof or in the sea most days, take myself off on day trips & dozen's of trips planned, have so much more quality time with friends and family.

whatever number you think you need , if you are late 50’s and haven’t retired yet, that number is to big

kimwp

dont_use_vistaprint said:

robatwork said:

MallyGirl said:

Indeed. I yearn for the days when I am not awake at 5am thinking through some issue going on at work.

Work is, by and large, being paid to take on someone else's stress. At least that's my view and experience. If you're lucky enough to be in a job you enjoy and doesn't stress you to a large extent, then you're in a tiny but lucky minority.

No wonder so many retirees on this thread and forum find a weight lifted when they push the R button.

It’s hard to explain, total release. I always enjoyed work, but came to the conclusion I’ve worked enough and at 53 decided I want a couple of decades for me before I’m too old to properly enjoy it.

I llove my days now I have a good long sleep every night, a lazy morning, make fresh juices, swim in the pool on the roof or in the sea most days, take myself off on day trips & dozen's of trips planned, have so much more quality time with friends and family.

whatever number you think you need , if you are late 50’s and haven’t retired yet, that number is to big

Or you haven't earned/saved enough.