Early-retirement wannabe

Marine_life

MSE_Andrea wrote: »

Hi all, just to give you a heads' up we may tweet this thread in the next week or so. If you find newbies joining in please do make them feel welcome!

Thank you

Ooh....I've never been tweeted before ;-)

I hope i like it.

greenglide

Marine_life wrote: »

Ooh....I've never been tweeted before ;-)

I hope i like it.

Might even be retweeted (again?):)

suse*

I am a long time lurker and subscriber to this thread and you have really inspired me to stop op the mortgage as much and chuck as much at my pension as I can. I am starting late at 36 but the calcuators have scared me to death as 20 odd years isn't long to save half a million or more.

So I am turning into a pensions bore to my friends as well, but before I had thought mortgage first then load the pension with the lack of mortgage payments, but after reading up I understand conpounding etc much better so I realise 20+ years compounding is way better than 10, and will still save me money in the long run even if I pay out more on interest this way.

So good luck on everyones journeys and thanks again for showing me the way when I still have time to catch up a bit.

gfplux

MSE_Andrea wrote: »

Hi all, just to give you a heads' up we may tweet this thread in the next week or so. If you find newbies joining in please do make them feel welcome!

Thank you

Well goodbye from me

ManofLeisure_2

gfplux wrote: »

Well goodbye from me

I feel the same way . Can't understand why this thread would be 'tweeted'. However, perhaps that's not surprising as I can't fathom out why anyone would want to tweet anyway . Perhaps someone can 'enlighten' me

Marine_life

suse* wrote: »

I am a long time lurker and subscriber to this thread and you have really inspired me to stop op the mortgage as much and chuck as much at my pension as I can. I am starting late at 36 but the calcuators have scared me to death as 20 odd years isn't long to save half a million or more.

So I am turning into a pensions bore to my friends as well, but before I had thought mortgage first then load the pension with the lack of mortgage payments, but after reading up I understand conpounding etc much better so I realise 20+ years compounding is way better than 10, and will still save me money in the long run even if I pay out more on interest this way.

So good luck on everyones journeys and thanks again for showing me the way when I still have time to catch up a bit.

Good for you!

I want to hijack you post a little with one of the topics i've been thinking about a lot which is so-called "lifestyle inflation" (and of course lifestyle delation).

I was in London this week and simply amazed (compared to where I live) about the number of fast food (and not so fast) eating establishments. Sure the products look great (and I am sure I would enjoy eating them) but at what cost? Paying £4-5 for lunch may not seem like a lot in isolation (although it always seems like a lot to me....but I'm a meanie) but when you take that into account over a number of weeks, months or years, together with the impact of compunding then the cost becomes very very significant.

That's only one example. There are many more where expenses creep up on you and quickly become the norm, things that you simply cannot do without (Netflix subscitpion, Sky TV, buying bottled water etc.). There are so many things out there to drain cash from your pocket (and your retirement account).

So how to get out of the lifestyle inflation trap and get on the trail of lifestyle deflation?

First step is to make a list of where you money goes - that includes not only cash but also those little direct debits that creep up on you and steal money from your bank account.

The next step is to see which items you can change on the list without having any impact whatsoever on your lifestyle. A couple of examples, I do drink bottled water but i buy it from aldi and make sure I take it with me, secondly, I am a bit music fan and i used to buy 5-6 CD's a month, I've now switched to spotify which costs me €10 a month (cutting my expenditure by 80%).

Secondly (and now it gets harder), what are the things you can take off the list - preferably also minimisise the lifestyle impact. Making sandwiches to take to work, cutting out the premium TV subscriptions etc. Some of this can be more difficult especially if you typically make "going for lunch" part of your socialising (but there are ways and means of adjusting your lifestyle).

As I approach retirement therefore I've cut a lot out of my budget but with almost no impact on lifestyle which is really important.

Taking on that challenge as early as possible should free up funds for building a retirement pot and make you more ready (and confident) to deal with the drop in income at retirement.

BucksLady

ManofLeisure wrote: »

I feel the same way . Can't understand why this thread would be 'tweeted'. However, perhaps that's not surprising as I can't fathom out why anyone would want to tweet anyway . Perhaps someone can 'enlighten' me

It is beyond me too :)

green_man

....but I'm a meanie

I enjoy your posts and please don't take this as a criticism:

Your thought process above is exactly right, but it's the sort of thinking that needs to be applied to those on average/low salaries in particular. In your case I think the combination of this mentality and your salary/assets is somewhat unusual, and I do wonder how much difference bottled water costs make when compared against running a Porsche or Q5 or a holiday home. I think for your own particular scenario you are perhaps being over cautious in some areas. - Still great advise though :-). I guess its the epitome of counting the pennies and letting the pounds rack up.

greenglide

I think for your own particular scenario you are perhaps being over cautious in some areas.

Yes but £5 a day spent on lunch is £1,300 over a year.

£5 a day isn't a lot but £1,300 certainly is.

I always take sandwiches for lunch and make sure I don't pay for posh coffees there as well.

Helps the money and the calories!

itm2

Marine_life wrote: »

Good for you!
There are many more where expenses creep up on you and quickly become the norm, things that you simply cannot do without (Netflix subscitpion, Sky TV, buying bottled water etc.). There are so many things out there to drain cash from your pocket (and your retirement account).

This is so true, and so important. I think the ability to trim day-to-day costs is also one of the best ways of mitigating risk in a retirement based on income drawdown.

When I retired last summer I focused on a all of the little things which I would have considered insignificant when the paycheques were rolling in, but which collectively have shaved 35-40% off our annual spending. For example:
- Switching the weekly online grocery shop to a cheaper supermarket, and using more in-store brands
- Planning meals for the week ahead and doing grocery shopping for what we'll need (rather than "stocking up", as we did before). This, along with the previous item, has knocked 40% off our grocery spending
- Ditching Sky
- Using the right cashback cards for grocery and petrol (this has effectively given us 4 free weekly shops in the first year)
- Clearing out the loft and putting alot of unused stuff on eBay - this brought in over £1k for us last year.

This is all standard fare for MSE readers of course, but I can't stress strongly enough what a massive impact they have on retirement plans.