How much do you REALLY need to retire?

pawlala

nearlyretired2004 wrote: »

Surprised to see my thread resurrected - but not sure I understand the last post ?

With no debt £2000 a month income is plenty for retirement in 2011? The value of sterling roughly halves every 10 years, so £4000 would be the equivalent in 2021.

mike88

Have you potential to trade down to a cheaper property? Even if your existing house is modest, a modest house in some areas can be expensive giving plenty of scope for trading down to a cheaper area or smaller property and freeing up capital. You needn't do this now but it could prove to be a lifeline should things get tricky down the road.

ChiefGrasscutter

DireEmblem wrote: »

So, based on having £280k left after the purchase of a flat, you would then have an annual income of 14k less tax etc. I think thats ample is it not?

That's 5% gross on £280K.
Can you tell me where you are going to get that out of a savings account much less one that allows you to actually get access to your money as and when you need it rather than being locked up inaccessible for 5 years plus.
I'd suggest that using various savings accounts both term and instant access you'd be more likely looking at an average of just over 3% return currently.

Yes I'm sure you can get that on bonds - but of course your risking capital here and when one has retired, risk to capital is not what one wants: as those who invested in the Bristol & West 'Pibs' all those years ago have recently discovered to their great cost.

(pibs are true bonds and not savings accounts in any way - and they gave higher interest at higher risk. Effectively purchasers were buying B&W debt. The B&W was bought out by an irish bank which has since collapsed and recently the pib holders have been offered a few pence in the pound capital return by the Irish government on a take it or leave it basis- oh dear).