Do we have enough to retire now?

atush

NineDeuce wrote: »

No. You should keep working for another 10 years....

Slightly alarmist, maybe they can afford to in 5 years?

Thrugelmir

Alexland wrote: »

Well it would likely have gone up by more than you have withdrawn as we have just had some excellent years for uk investors.

Devaluing the currency only provides a one-off boost. Strip out currency exchange and the picture looks far less rosy. If one isn't reinvesting the income generated.

Stubod

..looks very tight to me..as does "living" off £15k....(may be just surviving). I would be inclined to go another 5 yrs min to help bridge the gap between now and SP age....but thats just me....

Triumph13

I see the bears are out in force!
If you are genuinely happy on £15k pa then your only real risks are a) high inflation over the bridging period meaning that the bulk of your funds don't keep pace with inflation, b) political risk of significant reductions / delays in state pension and c) insufficient income for the survivor after the first death. With your other income streams as backup and downsizing or equity release later on c) is the only one that I see as seriously worrying.
With your spending levels the 2 SPs will already more than cover your spending so you really don't have to worry about whether we really are in a worse position for investors than ever before - and therefore need to draw at 3% or lower - as that's a small part of your overall income and you can afford to cut back in a particularly bad period - or at least not give yourself inflationary rises.

Linton

I have done some spreadsheet calculations taking into account assumed inflation and a zero investment (cash) return.....

A steady inflation adjusted £21K isnt possible even if it assumed to include all one-off large expenditures. Inflation is the problem in the early years, after you both get your state pensions almost all your income is inflation linked. If you restrict your average expenditure to something like the total of your SP and DB pension, say £19K/year inflation linked, things look a lot better.

Suggestions/comments:
- if you want £21K/year covering everything you really need your savings to increase more than inflation. This can only be done with investing. Are you happy with managing £300K of investments?
- 85 is around the average life expectancy for a man. There is a resonable chance you could both live beyond that age and a good chance that one of you will.
- When one of you dies the survivor's income will about halve. Their expenses wont. You need to look at some what-if calculations.
- Dont rely on downsizing when you are 85 - would you really be able to cope with a house move at that age?

AnotherJoe

I wouldn't be as optimistic as you about downsizing when older. A house or flat thats purpose built or fitted out for elderly people can be disproportionately expensive - if its a bungalow it takes up more land, if its a flat there are maintenance fees to pay, if its partly sheltered accommodation then higher fees.

Going back to your general question, I'd say not quite yet, would look at working a few years more unless you really hate your job. Even then, is there another job you could get?

kidmugsy

Deleted_User wrote: »

a software business and book sales that will keep money trickling in for years to come without us doing any work. Additionally, my husband loves photography and makes money out of that. So we would still have income but we don't want to factor that into our calculations. We want to think of it as a bonus.

Right or wrong, the consensus here could be interpreted as saying that those income streams would need to be included in the calculation because otherwise you'd be taking too big a risk with inflation in the gap until both your state pensions are in payment.

Remember that every extra year you work has a double effect - you have larger pension pots, and you will be drawing pensions for a year fewer.

bostonerimus

Assuming 3% annual inflation on initial 21k spending, the state pension and your civil service pension, then if you can get at least 4% a year return on your investments they will last until your early 90s. You'll still have the house equity.

If you start with your current spending of 15k/year with 3% inflation you could make things work with 0% return on investments, although the years just before and after your state pension starts look tight. If you can get 2% from savings accounts or short term bonds you'll be able to increase your initial budget to 19k a year.

Of course I'm assuming a level return and throw in some early years of large negative returns and your would be in trouble. It all comes down to your budget now and your ability to manage risk.

Terron

I have changed my mind from not quite to yes.

The 4% figure was calculated looking at past performance of the US markets from 1900 to 1986, and is the rate at which you could safely withdraw throughout that time and have you fund last 30 years. For the UK the figure is lower and the current low interest rates make it even lower.

You have the state pension and the DB as safety nets. So long as the funds last until you are both on the state pension you would be OK. That is unlikely to be more than 20 years. With some of them kicking in earlier and reducing what you need the risk is probably low enough to be acceptable.

[Deleted User]

Thanks everyone. That does help a lot. We can kind of semi-retire. We can put a few hours a week into the business to increase the chances of bringing in £10k or so for a good few years to come. I can start taking money out of my pension next year to avoid paying tax on it later. I guess I'd transfer it into a stocks and shares ISA? Hubby can do similar with his in 4 years time when he hits 55.

Re my State Pension contributions. I am utterly baffled and am at a loss to know how you can ever figure out for sure what you're likely to get.

I sent off for a NI statement and it came back saying I had 35 years contributions. However, for 10 years of my working life I was in the Civil Service. I've read that this essentially meant I'm counted as opted out and wouldn't get the full amount. However, the other day I went online here and calculated what I am likely to get :

https://www.tax.service.gov.uk/check-your-state-pension

It tells me that I qualify for the full amount.

I worked in the Civil Service from about 1985 - 1995.

Can anyone shed any light on this? I mean, if their estimate is completely wrong I have no comeback. Yet how can I plan if I won't find out for sure what I'm entitled to for another 13 years?