How much do you need to retire?

pricedout_1

These are ballpark figures but just to illustrate:-

State pension gives you around £5k a year.

If you have £300K in pension/ISA's returning roughly £15K a year this would give you about £20K a year to live on.

Is this right or am I missing something here? (And yes this is all in todays monetary values for illustration purposes).

Linton

Your figures look to be in the right ballpark. State pension will be around £7500. On the other hand if you wanted pretty certain inflation matching taking 5% is probably towards the upper end of reasonable.

This is of course assuming you retire at the State Pension Age. Many people will want to, and possibly need to, retire earlier. As to whether £20K-tax is sufficient is something you will need to work out.

somethingcorporate

"The number" should be based on how much you need not on how much you have.

Start with understand what your lifestyle costs - if £20k covers it then happy days. If you need £100k then it won't!

Cyberman60

I live adequately on well under 10K a year but I am careful with spending, always seeking best deals, eg: using giffgaff, water meter, SORN car when abroad. I have a friend who would struggle on 20K a year as saving is not in his vocabulary, so really it all depends on your mindset.

I must add that I still have the state pension (6K per annum) and another small DB pension to look forward to as well as owning a large house so I have absolutely no financial concerns for the future.

coastline

I would imagine most retirement incomes are less than £15,000 a year.
The link below from 2012 suggests most public and private sector pensions were a lot less than £10,000.

http://www.bbc.co.uk/news/business-15925017

http://www.bbc.co.uk/news/business-10912958

greenglide

The link below from 2012 suggests most public and private sector pensions were a lot less than £10,000.

But does that include State Pension?

But looking at the number who are entitled to Pension Credit (whether they claim or not) there is certainly a large number of people over the age of 65 who many of us would call "poor" or worse.

Whether people can live on £10,000 a year depends on lots of things. Housing costs is one.

torbrex

I plan to retire early at 55 on £3000/year with a lump sum of £20000 and I don't forsee any problems maintaining my current lifestyle.

greenglide

torbrex wrote: »

I plan to retire early at 55 on £3000/year with a lump sum of £20000 and I don't forsee any problems maintaining my current lifestyle.

But presumably only until SPa when you will probably get over twice as much State Pension?

Plus savings? Plus other pensions?

Cyberman60

torbrex wrote: »

I plan to retire early at 55 on £3000/year with a lump sum of £20000 and I don't forsee any problems maintaining my current lifestyle.

That sounds very optimistic. :eek:

coyrls

torbrex wrote: »

I plan to retire early at 55 on £3000/year with a lump sum of £20000 and I don't forsee any problems maintaining my current lifestyle.

That really would be "Just outside real life" for me.

torbrex

Cyberman60 wrote: »

That sounds very optimistic. :eek:

coyrls wrote: »

That really would be "Just outside real life" for me.

My current income is £2600 so it is a rise, I have been surviving quite well on that for the last 3 years.
I see no reason why I can't continue the trend.
I have a seperate holiday fund and that will be put to good use for my upcoming trip to Hawaii with no impact on my 'living' funds.