Is this year a good one to retire?

stephene_2

I am looking to retire this year and have various part pensions, some final salary, some annuities.
With the fall in the market due to China downturn plus the unsurity of being in/out of the EU - when is a good time to go.
Financial Advisers are loath to give advice as such - unless they get a %age - who do I go to - hence my question on MSE.
I can see that my pensions statements from 2015 were higher than they are in 2016! should I have reitred last year? too late I know - but on this basis should I go now? or after the EU vote? or hold on a while??
HELP!

Linton

You can expect to be retired for perhaps 30years During that time there will be several major crashes and booms. There will never be a time when there are no clouds on the horizon. If you are ready to retire you should have a financial plan with a fair amount of leeway. Work until you have the pensions, investments and savings to meet the plan, then retire.

AlanP_2

Market movements and uncertainty will make no difference to the DB / final salary pensions.

As for the annuities - If you have purchased an annuity ALREADY with your investment pot then again no difference.

If you mean that you have a number of DC / Pension pots invested in a range of Stocks , Shares, Bonds etc. then market value will have an impact (up today, down tomorrow and so on).

Your guess is as good as anybody else's on whether they will be worth more or less next week, next month, post June Referendum and so on.

For what its worth most markets went down in value last year, but my investments have recovered in the main.

How up to date are your valuations?

mgdavid

stephene wrote: »

I am looking to retire this year and have various part pensions, some final salary, some annuities.
.........

The markets may be the least of concerns.
Can you afford to retire?
Do you know your Number? (i.e. how much net income you need to pay the bills and support your lifestyle in retirement).
Are you at State Pension age yet?
Have you obtained an SP forecast?
Have you compared annuities with other options i.e. Drawdown?
If not at SP age yet, how do you intend to bridge the gap between stopping working and SP kicking in? (drawdown is one way of doing this as it's flexible not a fixed payment).

d70cw6

your investments are unlikely to crystalise until you draw on them.

greenglide

It is probably a good year for me!

LXdaddy

greenglide wrote: »

It is probably a good year for me!

It's a good year for me. I will be retired "before Christmas" this year.


To the OP - you need to have done your plan, work out how much you need in retirement and how you are going to reach that? If you are there then just pick a date.


The value of investments can go down as well as up. There is no way to predict will it be higher or lower in 6 moths, 12 months time.

jamesd

stephene wrote: »

the unsurity of being in/out of the EU - when is a good time to go. ... but on this basis should I go now? or after the EU vote?

First step is to learn about sequence of returns risk and the major effect it can have on retirement income based on investments, with the consequence of taking too high an income being a much bigger drop later or running out of investment assets.

Brexit voting is currently the most sure issue that can cause a major drop and if in favour a period of low returns of unknown duration and so for a person in your situation I think it is currently unwise to be heavily invested in equities and bonds. While I think that brexit is not the most likely outcome if it happens it would scupper your plans for potentially years and/or lead to notably lower income potential.

So my view is that you should move mostly out of equities and bonds until after the brexit vote and retire when you want to regardless, including now if you like.

After this particular time you can use established techniques like keeping a year or two of investment income in savings to avoid a need to sell during a downturn, replenishing by the natural dividends or interest payments so it can last more than a few years.

Broadly, Wade Pfau's Retirement Dashboard indicates that now is a worse time to retire using conventional investments than the majority of the time since 2000:



Waiting is not the solution, since it would take a substantial market drop to change the outlook and you'd be hurt by that if invested in the dropping assets.

What I've been doing is using P2P investments and more cash but you can use cash or short-term bond funds as alternatives if you want to stay invested in something and still retire now.

Don't let this keep you out of the markets long term, or even for more than a few months. A great time to go heavily back in would be after big drops when the papers are all on about the massive losses in stock markets.

mark1959

Well i'm retiring in a few weeks and my pension pot is mostly in equities. Hopefully if they do crash they'll recover soonish, I intend my pension to last for 15 years or more. So. yes. this year is a good year to retire.