Pensions Planning: The NUMBER

ognum

OldMusicGuy wrote: »

Netflix, Amazon Prime, Spotify, BT Sport are examples. Stuff that we make some use of but can live without. Right now it doesn't make much difference because I am saving so much that I can "easily" afford these things, but when I have no salary coming in they can go. We're already doing some trimming back (food and household expenses mainly) so have a pretty clear idea of what we need in that area to sustain ourselves. We're also cutting down on stuff like expensive coffees (a weakness). We bought a bean to cup machine, my wife buys the beans in bulk at a cheap price and we worked out that we are getting a week's worth of excellent coffees at home now for less than the price of a large latte from Costabucks (ok not quite so impressive if I included depreciation and electricity). The coffee's much better though.

Like many people I've been guilty of indulging myself (like buying expensive guitars for example) because I "think" I need them and I can justify it because I work so hard (it's a reward for me, right?). I haven't bought anything like that in the last year and I don't plan to. So I guess we are on the way but not fully there yet.....

Expensive guitars gives you assets to sell if needed!

OldMusicGuy

ognum wrote: »

Expensive guitars gives you assets to sell if needed!

True, but sadly they're not that expensive! I'm too tempted by midpriced guitars with fancy pickups that I don't really need plus of course too many effects pedals and gizmos. But I took the investment attitude with the classic car. I've got an appreciating asset that is actually cheap to run (0 VED, cheap to insure) and I really enjoy using. I'm getting any major work it needs done now and thus for at least 5 to 10 years it shouldn't need anything significant spending on it. I'll also be learning how to do regular servicing myself, one of the joys of retiring!

greenglide

this country seems a very expensive one to live in

Or do we earn too little?

Since large parts of the country have a dreadful productivity record these days, what can we expect?

I always wonder why people in work at the minimum wage are usually entitled to tax credits and other in work benefits? I am not suggesting for a minute that the benefits should be reduced, I feel that in a lot of cases employers get their labour too cheaply.

martinsurrey

greenglide wrote: »

Or do we earn too little?

Since large parts of the country have a dreadful productivity record these days, what can we expect?

I always wonder why people in work at the minimum wage are usually entitled to tax credits and other in work benefits? I am not suggesting for a minute that the benefits should be reduced, I feel that in a lot of cases employers get their labour too cheaply.

So should a single mother of 3 be paid more to do the same job as a single childless 18 year old, as they would need to be to replace the benefits they are entitled too?

Working benefits make up the difference between the lifestyle we as a country deem to be acceptable and the one which the ability of the person can earn.

justme111

That is different topic which can be debated forever and would be nice if it happened in another thread.

numpty_dumpty

I have been revisiting my pension planning lately and discovered this thread. Interesting to see others estimates.


I have a target of £2700/month take home as a couple to have no real change from current lifestyle or £2400/month which would still be comfortable but would mean a few more compromises as a Plan B where my health may force an earlier retirement.


Breakdown of the £2700 as follows:


Council Tax: £230 (£2760/yr)
Utility Bills: £180 (£2160/yr)
Food: £380 (£4560/yr)
House Insurance: £30 (£360/yr)
House Maintenance £200 (£2400/yr)
Entertainment (Eating out/cinema/theatre/gym/sport/swim): £400 (£4800)
Holidays: £300 (£3600/yr)
Car: £300 (£3600/yr)
Discretionary Spend Me: £300 (£3600/yr)
Discretionary Spend Spouse £ 300 (£3600/yr)
Emergency Spend (Appliance repair/replace, car repairs etc): £80 (£960/yr)


We should hit the £2700/month at 55 or maybe a little earlier, both currently 48, so I may put some more detail on the early retirement wannabe thread.

ianthy

Our 3 year career break ended in April 2016, we had a fab time and really it was also a bit of a trial to see if we felt happy not working. We are both now age 55 and plan to finish work in the next 18 months. We budgeted generously but still found that we spent more on social events than expected - maybe it was because we had more time and energy to take part in more events and expand our interests. Food shopping also increased - eating 3 meals at home plus snacks proved more expensive than the subsidised lunches at work.


Our learning from our trial early retirement was to budget generously, especially for social time, food and home repairs/maintenance. Plus do not assume that all costs will reduce due to the fact that you are not working.

Lungboy

I haven't tried to work out a final number, but current projection of workplace pension plus state pension gives a combined total that's very close to my current wage. That should be plenty for retirement, so every £20K I can save on top is a year earlier to retirement.

Northamptonblue

numpty_dumpty wrote: »

I have been revisiting my pension planning lately and discovered this thread. Interesting to see others estimates.


I have a target of £2700/month take home as a couple to have no real change from current lifestyle or £2400/month which would still be comfortable but would mean a few more compromises as a Plan B where my health may force an earlier retirement.


Breakdown of the £2700 as follows:


Council Tax: £230 (£2760/yr)
Utility Bills: £180 (£2160/yr)
Food: £380 (£4560/yr)
House Insurance: £30 (£360/yr)
House Maintenance £200 (£2400/yr)
Entertainment (Eating out/cinema/theatre/gym/sport/swim): £400 (£4800)
Holidays: £300 (£3600/yr)
Car: £300 (£3600/yr)
Discretionary Spend Me: £300 (£3600/yr)
Discretionary Spend Spouse £ 300 (£3600/yr)
Emergency Spend (Appliance repair/replace, car repairs etc): £80 (£960/yr)


We should hit the £2700/month at 55 or maybe a little earlier, both currently 48, so I may put some more detail on the early retirement wannabe thread.

£300 pm seems a lot to run a car. Do you plan to save that for a replacement vehicle? I wonder if you have a capital buffer for major items? My number is fairly close to yours so genuinely interested in what solutions you have come up with. I am planning on £30k pa for a couple but with replacement car and major very expensive holidays from non pension savings. I'm not really interested in maintaining the total amount of my savings pot as I think I might have over saved.

Retiring in July at age 59.

OldMusicGuy

Based on a lot of the input here and my own planning, I am getting pretty comfortable on planning for a combined after tax income of £30K per annum. Less than 11 months to go.....