I want to retire early

Bootsox

syco1 wrote: »

It is possible to live on a minimal amount of money, it depends what your expectations of a decent life are. I became too I'll to work and get around £128 a week on what is now ESA. That hasn't gone up for nearly 4 years. My wife worked part time but also became ill and was forced to give up her job, and she isn't entitled to anything but was expecting her pension and bus pass at 60, but now that is 66. We have modest savings so don't qualify for any council tax relief or income support, and to be frank, the way you are treated by DWP and councils means we wouldn't claim anyway. So we live off £128, don't have central heating on, and stay in bed with the occasional hot water bottle. TV is our entertainment, and at least we get free prescriptions. Expecting my ESA to be stopped soon, not sure what we will do then. Suffering from autism as well as physical problems, I can't bring myself to deal with DWP anymore. Probably die in bed...But at least we have funeral plans paid for.

Very interesting post.

I'm half tempted to keep a ledger and record every single flippin' penny I spend over the course of a year in an attempt to finally nail down where all my money goes.

The nearest I've got is to extract from my bank account statement all the cash withdrawals made last year. This equates to £180/wk which, off the top of my head (because I deliberately pay cash only for these items), will have been spent on beer, newspapers, inexpensive eating out, supermarket shopping, coffee shops, some train fares and other minor fripperies.

justme111

syco1 wrote: »

Suffering from autism as well as physical problems, I can't bring myself to deal with DWP anymore. Probably die in bed...But at least we have funeral plans paid for.

You may want to check with organisations/charities that deal with mental health issues, there may be some help from them re DWP, what you describing is disturbing to read

Molly4

Thank you for your input.


I didn't really understand what you were telling me.


Can you explain in more simple terms? Perhaps a step by step guide in simple language.


Regards

Molly4

syco1


I too was very concerned about your comments. I appreciate you do not want to deal DWP anymore. You must continue. You are entitled to so much more. As justme111 stated there are many charities and organisations that can help you. Don't give up.
One question is the £128 for both of you?

Annie1960

atush wrote: »

Actually, unless you have skills in t he sector, property investment can be a bad idea for many.

And yes, you can earn over 4K pa tax free under rent a room relief. Legal.

£7500 in current tax year.

https://www.gov.uk/rent-room-in-your-home/the-rent-a-room-scheme

Molly4

Good Evening


I just wanted to say a big "thank you" for all who have replied and commented. Sorry I have not been able to respond to every single one. Please keep your comments coming.


I've taken on board what has been said.


At present I am still waiting for my pension forecast to help me with my calculations and plans.


I've started to live a bit more frugally so I can save more to put into my pension for whenever I take it.


I can dream of the campervan option. I do have equity in my property but it still needs a lot of work doing to it before I can contemplate selling up. I can't really downsize as I live at the bottom of the property market already.


My post has turned out to be very interesting.

Annie1960

As well as trying to increase your income, try to find cheaper ways of doing things.

As someone said above, cinemas including Odeon do silver screen events at much cheaper prices for the over 55s.

Also, you could consider joining your local U3A once you are no longer in full-time employment. They organise many types of events which are cheap or free.

atush

Bootsox wrote: »

Very interesting post.

I'm half tempted to keep a ledger and record every single flippin' penny I spend over the course of a year in an attempt to finally nail down where all my money goes.

The nearest I've got is to extract from my bank account statement all the cash withdrawals made last year. This equates to £180/wk which, off the top of my head (because I deliberately pay cash only for these items), will have been spent on beer, newspapers, inexpensive eating out, supermarket shopping, coffee shops, some train fares and other minor fripperies.

Dont be just tempted, do it.

And stop spending in cash if you dont do the diary. I put everything on a card over 1 quid. And I mainly use a CC (for cashback) and not a DC. That way you can see exactly what you are spending on. And how much.

ermine

molly57. wrote: »

I've started to live a bit more frugally so I can save more to put into my pension for whenever I take it.

^ This.

It's the key to early retirement. There are many on here that anchor to a certain lifestyle/rate of living expenses, and feel 'they're worth it' and find reducing the spend takes away from their sense of worth. They will have to work until retirement age to keep up the rate of spending. And there is absolutely nothing wrong in that.

I was 49 when what had been a good job became a hell of nutty HR marketing practices aggravated by attempts to run people out of the company for cost-cutting, for technical reasons redundancy was expensive for them. And I looked at the manager trying to squeeze me and thought to self "I don't want to be doing this any more"

You can't turn a situation like that round on a sixpence - I sweated through the next three years saving everything I could into DC pension savings, with some of the excess into stock market ISAs. 2009 was a good time to start doing that After about £8k of cash ISA stupidity I got the clue and hit equities all the way, pensions and ISA savings, with NS&I for the emergency fund if I got canned earlier. I still have that EF because fortunately the emergency never came.

I did chase other internal jobs and got one that made better use of a legacy skill, and one that was time-bound for the 2012 Olympics when I wanted to retire.

I retired in 2012 after the Olympics. Haven't done a stroke of work since then* and it's fantastic. Reducing my wasteful spend on gadgets and crap like the fast and furious decompression holidays to get over work was the key. These didn't enhance my quality of life enough, and above all else didn't compensate me for putting up with increasingly enervating HR stupidity. There's no point in fancy holidays if they are to get away from crap work, for two years I didn't go on holiday outside the UK. But I didn't have the crap at work, and the swap was a fantastic deal.

There is only one answer for nutty employers, and that is to get the barstewards right out of your life. It's not easy to do that when you are older because you have accrued domain knowledge and may end up with less pay elsewhere. It made it easier to suck up the three years knowing making up for any one of those years would probably be many years at Tesco stacking shelves. That sort of thing concentrates the mind.

You can't get easy answers from here because it is you who will have to live your life. You have to learn the basics fast (preferably before the end of this tax year in April), and understand them. And if you want zero risk then keep on working.

I don't regret that decision for a single moment, and came to the conclusion that had I carried on working to 60 which was the normal retirement age for that company it would have been a waste of the time I have left on earth.

I worried too much about money at first, and probably underspent for several years, because being in a workplace like that colours one's world-view and made me excessively fearful, although I must hat-tip George Osborne for making changes such I didn't have to draw my pension early, and invest a larger lump-sum to compensate for the actuarial reduction.

You have to take the time out to learn about the facts, learn about what pensions can do for you which is particularly valuable while you are working if you are in your 50s and how that balances with the attractions of tax-free income from ISAs, which take an interminably long time to build up capital in because of the annual savings limits (though 20k pa now is more than the ~8k pa I started with). These are not easy things to understand, though they are all arithmetic not maths.

Early retirement for a late starter usually means putting in as much as you can into pensions so the Government doesn't steal your money with tax, and doing it via salary sacrifice if possible so they don't also steal NI from you. Make sure you put in enough to accrue that years State pension, as a rule of thumb use a pension to push your wage down to the personal allowance and take the hit of paying the residual NI.

All that means living on less. A lot less. And that sorts the people who really want it hard enough from the people who think it's a nice idea, although I do tip my hat to the many people who just don't earn enough or have too many dependants; they just don't have the option. The only exception to living on less is for God's sake don't pay off your mortgage early in these times of low interest, that money is worth more to you in your pension or in your ISA.

So put the work in to understand your position, what you can do and then come to the conclusion how much you want it. And then act appropriately. But it is work, a lot of work to seize control of the course of your life, particularly at such a late stage. Living a bit more frugally won't cut it. You want to be living a lot more frugally. Google "financial independence retire early" - look at Monevator, Retirement Investing Today, QuietlySaving, The FireStarter and Jim SHMD for people at different stages of that journey.

* work as in selling my time for money. I have charged people to fix problems on a no fix no fee hit-and-run basis, and for my sins I am doing the accounts for a one-man band because I failed to step backwards sharply enough, but I am trying to get rid of that ASAP. Work is massively overrated in my view - it's a damned interesting world out there and I've never had enough time to go check it out until finishing work.

ermine

Living_proof wrote: »

What would this thread consider to be a reasonable disposable income in retirement for a single person? Assume all my bills are paid...

There is a thread with 900 posts on it called The Number which addresses exactly this question. The first post is in accordance with other summaries I've read of what it takes for an average middle class lifestyle not in London. It presupposes a paid-off house I believe. I find it a bit low, but the number varies depending what you want