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When to retire......
Comments
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marathonic wrote: »Yeah, this echoes my thoughts. If I have the income I earned for and it lasts me until 100, the state pension can take me from there.
At the end of the day, you want the big income to fund hobbies and social activity from 55 (or whatever age you retire) until you are no longer able to pursue such activities.
I imagine that the average 100 year old is a lot more frugal than the average 55 year old with the main expenses being care related.
I don't see myself going on a caribbean cruise at 104
Those are interesting couple of points bearing in mind some of the threads of late. regardless of the age chosen be it 85/90/100 at some point care costs are going to start kicking in for some they w ill be high, for the majority they will be somewhat lower but still disproportionate to relative income. Whilst an older person may be very frugal the costs that impact them can be relatively high.
At that cut over age you are anticipating being OK to survive on state pension alone.
A pension needs to be the bread and butter IMO you also need a parallel fund to give you some discretion and flexibility in your choices. they may not be as tax efficient but this isn't only driver. That buffer period you have mentioned, 55/65, may not offer you the kinds of options you expect. It may well be 60/75 in a few years time and other factors in your life may have taken precedence.
You may also find that health/quality of life tails off rapidly past a certain age and whilst average may be increasing many of those years aren't always spent in the best of health a fat pension then may not be of much use."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
grizzly1911 wrote: »Those are interesting couple of points bearing in mind some of the threads of late. regardless of the age chosen be it 85/90/100 at some point care costs are going to start kicking in for some they w ill be high, for the majority they will be somewhat lower but still disproportionate to relative income. Whilst an older person may be very frugal the costs that impact them can be relatively high.
All good points; in fact this is really the issue when it comes to retirement planning: there is no obvious correct answer it is all manage risk and reward.
Save too much and you may not get to enjoy it and waste opportunities; save too little and you could end up living on very little with poor, if any, care.
The fact that government spending plans are such a joke and change so much certainly doesn't help either. Why save a big pension pot if the government may well come along and take a chunk off you anyway. If things get desperate will they make the state pension income-assessed in which case why bother saving for one privately unless it'll be much better etc.Having a signature removed for mentioning the removal of a previous signature. Blackwhite bellyfeel double plus good...0 -
grizzly, I totally agree with you about the state pension being inadequate post 100.
However, it's all about the risks you're willing to take. Personally, I don't think state pension will be adequate but also highly doubt that society in general will allow those approaching, and over, 100 to starve to death or not have someone dress them when they are unable to do so themselves.
Basically, if I can provide for a comfortable lifestyle to 100 myself, I'm willing to sacrifice a little of the comforts post-100 in order to have a little more comforts and luxuries now.0 -
All good points; in fact this is really the issue when it comes to retirement planning: there is no obvious correct answer it is all manage risk and reward.
Save too much and you may not get to enjoy it and waste opportunities; save too little and you could end up living on very little with poor, if any, care.
The fact that government spending plans are such a joke and change so much certainly doesn't help either. Why save a big pension pot if the government may well come along and take a chunk off you anyway. If things get desperate will they make the state pension income-assessed in which case why bother saving for one privately unless it'll be much better etc.
You are right it is a question of balance at any given point and you can only make decisions based on the information you have. As you say governments have and will continue to move the goal posts. At some point you have to make a judgement and say that is as much as I can sensibly provide for and get on with making the most of your life before it is too late.
If they are prepared to invest in a pension I am sure that an individual will also want to be prudent in many other ways. Not overcomitting in mortgage terms, not burdening themselves with unnecessary debt etc. It will be the whole package that will get someone through. Dumping loads into a normal pension isn't a panacea for all the future holds.
Don't forget stuff happens in life, that are often beyond an individuals control, that can throw the best laid plans awry."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
Well we've had early retirement since the 1980's slump in UK manufacturing...millions have enjoyed an extra 10 years of leisure as a result....and lived comfortable lives since.
What happens next is anyone guess...as a result of the previous clearout in the workplace final salary pensions are almost a thing of the past.
Those that are lucky to be still part of them should be fine in the future...but for the rest its difficult to say.
The retirement age is moving further away and its not going to be easy for manual workers to maintain their fitness levels...maybe there'll be more claiming sickness benefit ..who knows.
Phased early retirement and part time working isn't available to all so its going to be testing time for employees and the government.
If you can save for retirement then fine...but thats still a problem to many without fixed term employment...part time work continues at a faster pace than full time.
Housing is another factor for the young with first time buyers now into their 30's before they purchase....and the growing trend in buy to let which has risen from 50,000 mortgages to 1 million in no time.
If the trend continues in renting then its hard to see how a second pension will go anywhere apart from your landlords pocket.
Lets take £600 a month rent for an example...over £7,000 a year...so you'll need a pension pot over £100,000 [ link below] just to cover your rent.
£100,000 at 3% inflation will be over £500,000 in a working lifetime....difficult times ahead.
http://www.hl.co.uk/pensions/annuities/annuity-best-buy-rates0 -
No, it's not to disincentivise retirement, it's to ensure government expenditure is fair for all generations and most importantly, affordable.
I realiose that is your reason for suggesting it. But it will disincentivise retirement for some people who will just work longer and result in less jobs in the short term at least.Few people are capable of expressing with equanimity opinions which differ from the prejudices of their social environment. Most people are incapable of forming such opinions.0 -
I realiose that is your reason for suggesting it. But it will disincentivise retirement for some people who will just work longer and result in less jobs in the short term at least.
Which is why we need a smaller population, not a larger one. Less resource + more people = far less to go around.0 -
marathonic wrote: »grizzly, I totally agree with you about the state pension being inadequate post 100.
However, it's all about the risks you're willing to take. Personally, I don't think state pension will be adequate but also highly doubt that society in general will allow those approaching, and over, 100 to starve to death or not have someone dress them when they are unable to do so themselves.
Basically, if I can provide for a comfortable lifestyle to 100 myself, I'm willing to sacrifice a little of the comforts post-100 in order to have a little more comforts and luxuries now.
Might be over egging it a bit to expect that much at any sort of pace of life. Average life expectancy.
Male 77 Female 82
http://en.wikipedia.org/wiki/List_of_countries_by_life_expectancy
Even allowing a +10 year extension.
."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
Which is why we need a smaller population, not a larger one. Less resource + more people = far less to go around.
Whilst a smaller population may have an impact, it's not a viable solution - how on earth are you going to enforce it?
We need more exports and more tourism, plain and simple. The current, weak, pound should assist with this.
With more money coming into the country, it will be circulated around everything from restaurant workers to taxi drivers to pubs and hotels - all with the government taking their cut.
When the governments cut is big enough, roads will be resurfaced, fibre-optic broadband areas will be expanded, hospitals will be built, etc. leading to more jobs.
It's a simple solution but one that will take a LONG time to implement.0
or is that because you'll be skiing in the Alps :rotfl:
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