Early-retirement wannabe

Student_of_£

Hi everyone! I too am an Early Retirement Wannabe.
I'm currently at university and will graduate next year. I've been very interested in all your posts and realised there are sooo many variables involved!!
My plan is as follows:
- Graduate / improve skills / employability.
- Save up a 6-8 month emergency fund.
- Split my savings between pension contributions and S&S ISA.
- Get and pay off mortgage (before retirement)
- Retire at 60 or go semi-retired.

What I hope is to have a "comfortable" retirement, the last thing I want is to spend everything I have, get to 65 and then have to live on £107 or whatever the SP will be.

I also agree that life has to be enjoyed today, but there's no harm in making sure life can be enjoyed in 40 years time.

gadgetmind

Student_of_£ wrote: »

I also agree that life has to be enjoyed today, but there's no harm in making sure life can be enjoyed in 40 years time.

Exactly, and by starting early you won't suddenly get a shock in your 30s (or even 40s!) and have to deep far deeper than you'd like.

cyclonebri1

I was active in this thread ages ago, so still get the reminders.

I'm going to post again as things from my perspective have changed a little.

Can't remember what I posted earlier, but basically I was planning or rather dreaming I think of retirement at 55, some chance:rotfl::rotfl::rotfl:


But I had a serious accident when I was 54, and by the time I was 55 it was obvious I wasn't able to return to a job I had worked up to for 38 years.

I retired, I drew my company pension, (only had 15 years contributions), with the bonus of retiring on ill health grounds, meaning I received a pension equal to that if I had retired at 65.

I also drew my private pension which I had paid for 15 years prior to the company scheme. There was a little extra added there in compensation for miss selling.

I took max tax free cash from each whi9ch was put to fixed rate savings.

It's now 5 years later and things are pretty good given my injuries, I get around a little better, haven't had to dib into savings until last year, (daughters wedding. new conservatory, new retaining wall, etc).

But I would say that my income which provided good cover for running costs, a car, and a few extras, now shows a deficit of probably £200 per month over those 5 years.

Ok, I've not included savings interest that easily covers that, but that 2 has more than 1/2'd, I recall over 7%:eek::eek::eek:;) being offered 5 years ago.

We are ok, but things have got more expensive and in 5 years time the top up of the OAP will be very welcome.

I only have 1 real piece of advice for wanabee early retirees;

Ensure you are in a position to allow your partner the same luxury of finishing at the same time, believe me it can cause friction so be aware.

Must go now, I have the pots to clear and the floors to do before she gets home from work or..................................................:D:D:D:D


I am serious about this point even If I make light of it, good luck with your plans all:T

cyclonebri1

gadgetmind wrote: »

Exactly, and by starting early you won't suddenly get a shock in your 30s (or even 40s!) and have to deep far deeper than you'd like.

It's called compromise, you have to save a little and live a little, large that if you have the funds.

Sorry, meant to post this before my last 1)

Tancred

The best way to retire early is to marry a wealthy person and then put 90% income (or as much as HMRC allows) into a pension scheme. If you can live without a proper income for 35-37 years or so then you may be able to have a good one at 55!

gadgetmind

Putting 90% of your income into a pension really, really isn't necessary even if you do intend to retire at 55.

Tancred

gadgetmind wrote: »

Putting 90% of your income into a pension really, really isn't necessary even if you do intend to retire at 55.

Show me an investment that guarantees 30% growth a year or more an I might agree with you.

cyclonebri1

gadgetmind wrote: »

Putting 90% of your income into a pension really, really isn't necessary even if you do intend to retire at 55.[/QUOTE

Correction, it "really isn't possible";););)

I think using percentages here in this thread is really misleading.
Let me explain why.


Ok you have money, why on earth would you need to pay into a fund that takes your money, gains an interest on it, and then pays out a figure that is weighted against your life expectancy in favour of the Ins company?? IE in average terms you will die before you gain.

And the very poor off that have paid say 10% into a private pension, will find it brings them just into an area that means no supplementary benefits are available to them.

Take care rich and poor folks.

I'm not cynical, but I do try to be pragmatic.;);)

atush

Cyclone, do you regret taking Max lump sum instead of higher pensions?

Do you regret only saving that TFLS in savings at fix rate deps, instead of investing some for a higher income?

gadgetmind

cyclonebri1 wrote: »

Ok you have money, why on earth would you need to pay into a fund that takes your money, gains an interest on it, and then pays out a figure that is weighted against your life expectancy in favour of the Ins company?? IE in average terms you will die before you gain.

Perhaps there was once a pension that worked like that, but I doubt it.

There are now (and have been for years/decades) many very good pension schemes that let you control where you invest, have reasonable/low fees, and don't require that you buy an annuity at any point.

When I log onto various online platforms, I can see our ISAs, pensions, and other investments on one screen, see how everything is doing, and (very rarely) tweak where the money is invested.

Pensions are just a tax wrapper, and if people learn just one thing from this thread, this is the one to learn.

And the very poor off that have paid say 10% into a private pension, will find it brings them just into an area that means no supplementary benefits are available to them.

Hence the move to the flat rate state pension and the gradual elimination of means tested benefits.

But really, is planning to be so poor that you have to rely on handouts in retirement something anyone on MSE should really be aspiring to?

Being pragmatic is great, but you also need to be informed. MSE forums can help with that, if you let them, so maybe dial back the cynicism one or two notches.