Early-retirement wannabe

Former_MSE_Andrea

Back again. Thanks for your patience everyone

westv

Pheeew!! :T:T

.....

glass_half_full

Hi all,

I have recently become debt free apart from the mortgage after 2 ½ years of debtbusting with the help of this site. I am now planning for the longer term, this thread caught my attention.
Some initial thoughts.

When did you begin planning and what drove the decision?
Reaching 50 and also seeing how the workplace is not getting any easier and perhaps harder. Realising that I wanted to reach the position of being able to choose what I do with my life and that this needs a degree of financial independence.

What is the strategy for getting there?
I have a few small DB pensions from employers earlier in my career. I have about £140,000 in two DC pensions. I am a member of the USS pension scheme. I currently pay in 8% and an additional 9% in AVCs. I aim to retire/semi-retire at 60 as a backstop and possibly before around 58. I started work in the University sector aged 45 so at 60 I would have 15 years service. My OH is a teacher, she is in the Teachers Pension Scheme. I have built a spreadsheet to model all these numbers and assumptions.

How much of a relative decline in income are you prepared to take / did you take?
Our current monthly outgoings have been around £3500 per month for some time. Key differences will be no mortgage (£640), no debt repayments (£400). Reduction in costs of supporting DS at University. Reduction in costs of car / commuting may be offset by spending more by not being at work. I have worked out a rough budget post retirement that suggests a budget of £1800 per month (£21,600 per annum) so about £30K pre tax.

What are your main concerns?
Bridging the gap between 60 and state retirement age of 67. Balancing between having reasonable quality of life now versus having savings in the future.

Marine_life

A brief update from the ERW household.

We've signed up for another year of working!

But there is a bit of a change. In that I've moved to a self-employed contractor (well, Limited Company) basis which means that effectively I am now on 15 days notice. The tricky thing now is to work out how to shield the money from the tax man . It will be difficult.

I suspect I am demonstrating that Financial Independence has nothing to do at all with early retirement and while I think we spent a long time thinking about (and planning for) the financial aspects of leaving the workforce, we did not spend enough time thinking about the human aspects i.e. what to do with all the time? and how do we feel about the change of status?

As a middle-aged man, I was a good runner but I look back on days and I wish someone had said to me "today, is your best ever day, you will never be as fast as this again!" Of course, that's impossible but I look at life now (or more specifically at work) and I think "This was never just a job, it's a career, you spent your life working towards this once you're gone you're never getting this back". I could die tomorrow (hope not!) or I could live for another 30-40 years I've only worked for 30. If I were lucky enough to do that could I honestly look back and say you left it too late?

At age 53 we now have assets and income that most people can only dream about but unless we can replace what we had with something equally meaningful then I can't see a reason to stop.

That has to change so we're going to figure out our life plan over the next 12 months. Retiring at 55 has a nice ring to it ;-)

chiefie

Yours is an interesting journey marine life thanks for sharing !!!55357;!!!56397;

k6chris

Marine_life wrote: »

I suspect I am demonstrating that Financial Independence has nothing to do at all with early retirement and while I think we spent a long time thinking about (and planning for) the financial aspects of leaving the workforce, we did not spend enough time thinking about the human aspects i.e. what to do with all the time? and how do we feel about the change of status?

I think you have hit the nail on the head. I am finding that whilst it is very easy to fill my time with a multitude of enjoyable distractions, I am missing the illusion of 'purpose' that my previous job(s) gave me. I almost feel guilty that I have the time and (limited) finances to do what ever I want and have no idea what that actually is! As someone whose kids have grown up, flown the nest, come back then flown the nest again, it is a double whammy! I used to be a dad and have a job, then I had a job, now what?! First world problem I know, but still a problem none the less. I know that I could get another job, but in reality that is just kicking the can down the road... I am in my mid fifties and for the first time in my life can do anything I want.......and I have absolutely no idea what that is!! Pathetic isn't it!

Bimbly

glass_half_full wrote: »

I have worked out a rough budget post retirement that suggests a budget of £1800 per month (£21,600 per annum) so about £30K pre tax.

I think your maths is off (in a good way!). For take home to be £1800 per month, you're looking at a yearly income of £24,050 assuming a full personal allowance. Remember, no national insurance payable in retirement. You can play with figures here:

https://www.thesalarycalculator.co.uk/salary.php

This assumes all income is taxable and you're not taking 25% tax free from your DC pensions each time you withdraw (eg, you took the full tax free lump sum up front or this is income from your DB penioms).

Well done on clearing debt at the same time as building up pension (not everyone manages both).

Bimbly

Thanks for continuing to update this thread, Marine Life. This whole thread has been a fascinating read.

I don't have your financial resources, but I do have similar concerns what to do once I give up the job. I have other stuff I want to do, but they are mostly solitary pursuits and I am concerned about lack of social contact.

itm2

Mine was a very different situation. At the age of 52 I asked myself the question: am I spending most of my week doing something that I enjoy? The answer was a resounding "NO!", so I quit 2 months after my 53rd birthday (5 years ago).

Since then I have had no issues with the "what shall I do with my time" or social aspect of not being at work during the week. I've been learning the piano and guitar, playing badminton, golf and tennis every week, doing a bit of work as an extra on film/TV sets, doing focus groups/market research projects and also a bit of IT support for home users. I'm now more active and more sociable than I was when I was working, and never have enough time to spend practising the guitar and piano (or drums, which I also dabble with).

It can be surprisingly easy to carve out a much more fulfilling life if you're really fed up with the 9-to-5 ;0)

atush

Marine_life wrote: »

A brief update from the ERW household.

We've signed up for another year of working!

But there is a bit of a change. In that I've moved to a self-employed contractor (well, Limited Company) basis which means that effectively I am now on 15 days notice. The tricky thing now is to work out how to shield the money from the tax man . It will be difficult.

I suspect I am demonstrating that Financial Independence has nothing to do at all with early retirement and while I think we spent a long time thinking about (and planning for) the financial aspects of leaving the workforce, we did not spend enough time thinking about the human aspects i.e. what to do with all the time? and how do we feel about the change of status?

As a middle-aged man, I was a good runner but I look back on days and I wish someone had said to me "today, is your best ever day, you will never be as fast as this again!" Of course, that's impossible but I look at life now (or more specifically at work) and I think "This was never just a job, it's a career, you spent your life working towards this once you're gone you're never getting this back". I could die tomorrow (hope not!) or I could live for another 30-40 years I've only worked for 30. If I were lucky enough to do that could I honestly look back and say you left it too late?

At age 53 we now have assets and income that most people can only dream about but unless we can replace what we had with something equally meaningful then I can't see a reason to stop.

That has to change so we're going to figure out our life plan over the next 12 months. Retiring at 55 has a nice ring to it ;-)

My OH was supposed to go next year, but he has signed up for 2 more years!

Since then I have had no issues with the "what shall I do with my time"

I have issues with my OH not having enough to do with his time lol. Hopefully he will play a lot of golf like he used to do back in his 20's/30's.