Early-retirement wannabe

mark55man

You are in a great position


For advice about how to juggle your funds between pensions, savings ISA's and other portfolios high yield, growth or risk, I would ask a separate question in the pension board (ie the same area as this thread). That will allow more detailed comment with derailing the OP's thread (original poster)
+ If you just read a couple of weeks worths of other threads you will get some idea of how thoings work (+ savings and investments would also be good)


Cheers

Jul2015

Hi
Thanks for the quick reply. Will look at other threads and hopefully pose some questions there - apologies if I've taken this one off topic slightly.

Yes I am currently in forces accomodation - probably the only remaining perk of the job these days!! I'm pretty much happy to move anywhere (safe) if the house is right - overseas if needs be but that then throws up a different set of questions.

atush

Although you are in a great position your wife needs a good knock on the head, not being sexist it could come from another female like me. She is turning down 'free money' and she is paying tax she doesn't need to.


If you are planning on paying out that great cash pile (which btw is too big and some should be in income producing funds) then she won't have income in her name to mop up her PA in retirement. So again paying too much tax.


and yes, you do need to look at property to live?retire in if you don't own any. Probably the sooner the better.


But choosing where will depend on whne she will retire as well. You could always buy, then rent out while you are still where you are for a few years.

Jul2015

"

atush wrote: »

Although you are in a great position your wife needs a good knock on the head, not being sexist it could come from another female like me. She is turning down 'free money' and she is paying tax she doesn't need to. "

Many thanks for the replies. That's probably my fault as I tend to look after all of our finances. Would it be advisable to make some lump sum payments into a pension on her behalf? I understand she can pay in each year a sum equal to her salary? My other thought is to use S&S ISAs for the future.

Quote "If you are planning on paying out that great cash pile (which btw is too big and some should be in income producing funds) then she won't have income in her name to mop up her PA in retirement. So again paying too much tax."

Part of the cash pile is earmarked for a house (circa 200k) so that only really leaves 100k currently in cash that needs to be working harder. We have that 100k within an ISA wrapper so have some protection against future tax. So really it boils down to pension or ISA? I know the pension has tax benefits but reading this thread has highlighted some rather poor returns that people are forecasting with pots far greater than ours. This is what makes me lean towards drawing down the lot.

atush

Yes, using the cash pile to buy a home for the future is wise, esp now prices seem to be lifting in areas other than the SE. If you dont' need it now, rent it for a few years?

Anyway, yes your wife needs pension provision, but ideally the one her employer pays into (at least enough to get the maximum employers contribution) then enough to build a pot to use her PA. So pension first.

S&S isas after/alongside. Being tax free, they don't mop up any of the PA.

gfplux

Hello jul2015,
You should do your best to involve your wife as if you die suddenly she will have problems.
The least you could do is set up a spread sheet of your joint NET WORTH. This, in this one document will give her a tool to trace all your accounts etc but might also be just the catalyst to excite her interest as the total is, with good fortune always be growing.
This I have done for a very, very long time and has always been of great interest to my better half.
In addition if you do your tax as self assessment do try and go through it with her before you submit it. Any meetings with accountants or other advisers should NOT take place without her presence.
When anyone dies it is a huge shock and if I go first I don't want my wife to have to start a "treasure hunt" without a map (the net worth document)

mark55man

gfplux wrote: »

Hello jul2015,
You should do your best to involve your wife as if you die suddenly she will have problems.
The least you could do is set up a spread sheet of your joint NET WORTH. This, in this one document will give her a tool to trace all your accounts etc but might also be just the catalyst to excite her interest as the total is, with good fortune always be growing.
This I have done for a very, very long time and has always been of great interest to my better half.
In addition if you do your tax as self assessment do try and go through it with her before you submit it. Any meetings with accountants or other advisers should NOT take place without her presence.
When anyone dies it is a huge shock and if I go first I don't want my wife to have to start a "treasure hunt" without a map (the net worth document)

very good advice


I have been moving along these lines, although not quite to that extent. I do share quarterly progress reports with her, her father (who provided some cash for the kids) and the kids.


That is a start, but not sure I have finished with the education yet

gadgetmind

I've got all of our savings accounts in one spreadsheet, all of our investments in another, all of our share trades and dividends in yet another, and then one big projection spreadsheet that brings them all together.

mark55man

gadgetmind wrote: »

I've got all of our savings accounts in one spreadsheet, all of our investments in another, all of our share trades and dividends in yet another, and then one big projection spreadsheet that brings them all together.

we are not worthy

Marine_life

There is an impending sense in the ML household that thisearly retirement journey could be about to become a reality.

I wanted to reflect on a theme that has come up on thisthread and that is the one about money or more importantly having enough money.

Just how much is enough?

We’ve seen other threads on these forums which talk about “thenumber” and I have to say most of those suggest (and I have not calculated theaverage!) that around 25,000 per year is enough to live a comfortableretirement I haven’t worked out whetherthat if for a couple of for a more extravagant single ;-) but I suspect it isfor a couple.

It’s clear to me that in this discussion perspective iseverything.

What do I mean by that? Well as a keen reader of MrMoneyMoustache it’s clear that hisperspective is all about cutting our all unnecessary expenditure and makingsure that every dollar spent is spent for a purpose. However the real point seems to be that heactually enjoys his approach to life (and in fact I am sure is now making atidy sum from his blog as a result).

The second point is how much of an adjustment is necessaryto achieve your goals? And here I thinkthe old adage “you never miss what you never had” starts to make perfectsense. The ML household started itsmarried life with very little cash and in fact when negative equity (rememberthat) reared its head at the beginning of the 90’s, negative cash. But over the years we’ve become complacentand while we are now able to save a large portion of our take home pay, thatcertainly wasn’t always the case.

Thirdly, let’s look at something else and it’s calledability. Ability to do things foryourself whether that be preparing your own accounts or mending a leakingtap. Can you do it? Can one of your family do it? And if they can’t are you happy to live yourlife with a leaky tap?

What the point of all this waffling?

Well the point is, It’s no goodasking “how much do I need to retire” of “where should I retire” (see otherthread) without really considering individual circumstances. It sounds obvious but so many are looking fora simple solution, a solution which, given the length of time many of arelikely to spend in retirement is one that requires some thought and planningand yes, probably some spread sheets.


The ML journey is proceeding at a pace. I might have mentioned we have had an offer acceptedon an 19th century farmhouse with letting business attached. It’s a complex transaction but things aremoving forward and ideally we will exchange contracts by the end ofFebruary. Once we exchange that reallywill be the point of no return and the journey will begin in earnest.