Retire Easy

jerrysimon

https://www.retireeasy.co.uk

Not sure if there is already an extensive thread on here about this ?

Seems like another helpfful tool. Takes a while to fill out and work everything out but quite comprehensive.

Anyway I have been putting in my figures and the only thing I cant work out is the option to downsize your home at a given time in the future. I have filled it in and it does not seem to have any impact on the graph ? I would of thought this would show an increase in capital added to draw down on added to income ?

Jerry

pandora205

I've been using it for a while - I must have heard about it here somewhere so there will be other threads. When I couldn't work out what to do about a particular situation I sent an email to the site and got a very helpful reply, so you could try that about the downsizing scenario.

mgdavid

downsizing comes up in retirement planning a lot; the received wisdom is that far less capital is freed up than one might think.

dunstonh

the only thing I cant work out is the option to downsize your home at a given time in the future.

That is usually an unreliable option unless you are in the expensive South East and moving to a much cheaper area or you have a significant property now and scope to reduce scale a lot (as the costs of moving and bringing the new property to your requirements etc) can often run to around £25,000.

Also, it is very common for people who say they will downsize to revise their plans when they actually realise what downsizing means. Smaller bedrooms, less living space etc. A lot of people cant handle that and don't end up downsizing.

? I would of thought this would show an increase in capital added to draw down on added to income ?

You dont expect free tools to be as good as paid ones. However, I would have thought the easiest solution here would be to add a lump sum on the amount you think you may make on downsizing using the date you may do this. And probably deduct £25k or so on the figure you have for good measure.

bigfreddiel

mgdavid wrote: »

downsizing comes up in retirement planning a lot; the received wisdom is that far less capital is freed up than one might think.

In my case it freed up about £400k cheers fj

AnotherJoe

jerrysimon wrote: »

https://www.retireeasy.co.uk

Not sure if there is already an extensive thread on here about this ?

Seems like another helpfful tool. Takes a while to fill out and work everything out but quite comprehensive.

Anyway I have been putting in my figures and the only thing I cant work out is the option to downsize your home at a given time in the future. I have filled it in and it does not seem to have any impact on the graph ? I would of thought this would show an increase in capital added to draw down on added to income ?

Jerry

I've just had a play with mine and think I see what's going on. Let's say your capital value is 2 million made of one million in various investments and a house worth one million.
If you put a downsize in at say age 80 releasing half the equity, you still have two million in assets and all that's happened is that the balance has changed., it's now 1500 in investments inc cash and 500 house. And as long as you aren't needing to spend that new cash then it doesn't alter anything. That's my case, eg I don't need to downsize for the cash so downsizing alters nothing.

As dunstonh says you could also model this by omitting the value of your house entirely and then (using the above example) adding a lump sum of 500 cash coming in at at age 80.

You could argue that if you intend just to live in your house until you peg it, (or its sold to fund a care home) that counting it as an asset doesn't really get you anything, it's not an asset in the sense a pile of cash or some stock market investments are and that you'd spend it down at say 5% a year.

You could always run a couple of models ( I think you'd need two logins) which are the same apart from this difference, house/ no house, making it clear what your really liquid assets are in the model without owning a property.

AnotherJoe

bigfreddiel wrote: »

In my case it freed up about £400k cheers fj

Is that because you've downsized releasing half and that's £400k or you've done the practical analysis that it will release that much?

I recall someone posting here they planned to downsize but when they looked at moving from a big house to a smaller bungalow and include the fact that the smaller bungalow was in a better area (closer to shops and facilities for example) and was quite expensive because of that, plus add on the expense of moving, they released far less money than they thought they would.

atush

mgdavid wrote: »

downsizing comes up in retirement planning a lot; the received wisdom is that far less capital is freed up than one might think.

In many cases I can see that, but in our case with a 5 bed 4 bath on 2 acres with outbuildings, I can see 50% capital being left over after buying a 3 bed bungalow. But we shall see in time.

I wont bet the farm on it.

AnotherJoe

atush wrote: »

In many cases I can see that, but in our case with a 5 bed 4 bath on 2 acres with outbuildings, I can see 50% capital being left over after buying a 3 bed bungalow. But we shall see in time.

I wont bet the farm on it.

It sounds as if you literally are

Yes I think in your case it would seem likely to be worthwhile financially. I think it's more in the "typical " case of let's say someone in a 3 or 4 bed house moving to a 2 or 3 bed bungalow or flat where the maths doesn't work as well as many expect.

Chickereeeee

AnotherJoe wrote: »

It sounds as if you literally are

Yes I think in your case it would seem likely to be worthwhile financially. I think it's more in the "typical " case of let's say someone in a 3 or 4 bed house moving to a 2 or 3 bed bungalow or flat where the maths doesn't work as well as many expect.

Actually, as someone above said, house/land prices in the country are much lower than somewhere close to amenities, transport, shops etc. Depending on precise location, of course.

K

Chickereeeee

jerrysimon wrote: »

https://www.retireeasy.co.uk

Not sure if there is already an extensive thread on here about this ?

Seems like another helpfful tool. Takes a while to fill out and work everything out but quite comprehensive.

Anyway I have been putting in my figures and the only thing I cant work out is the option to downsize your home at a given time in the future. I have filled it in and it does not seem to have any impact on the graph ? I would of thought this would show an increase in capital added to draw down on added to income ?

Jerry

Works OK for me. Assuming some of your retirement icncome will be from investment growth, try putting in very low (realistic...?) investment growth/income %s. Then look at the Capital and Income tabs in the result (plus the date you run out of money of course) and compare with/without downsize.

K