Choice of Funds in my pension - any advice?

MK62

Unfortunately, the OP's targets are likely to be too optimistic......he would either need to boost his contributions to around double the current level, push back retirement around 4 years or so, or reduce the monthly income needed to around £1200pm....or a combination of the three.


It's obviously impossible to be definitive though.....a nasty equity market downturn could put paid to even the above.....(though the opposite is also true of course)

hyperhypo

picking up on bimbly's observations as i have also doing same , except now in final two years stage of accumulation pre DB at 63...my obstacle presently is how to craft the cash element within the current .

Do i give it a haircut now ..it being 4 x MA funds (risk rated 42 25, 56, 60)...to create new cash fund... current value is £150k, contributions £2k pcm via salary sacrifice to continue for two more years, whence i need to withdraw £50k to fund pre DB retirement.

Question is how to handle the cash fund in scheme...i'm minded to do something now , rather than need to sell my MA funds in a downturn in 2 years time. Thoughts ??

jamesd

Looking at the original post, the undesired mortgage looks desirable.

The current plan appears to be to take a 25% cut in DB income and presumably DB lump sum by taking it at 55 instead of 60. That's a cut for life and presumably the life of any spouse while the mortgage lasts only until it is repaid, if that's even seen as desirable.

So find out what level of mortgage that 25% reduction could pay for over say 25 years and see what that added capital does to the numbers. Remember to account for repayment expenditure in the five years between 55 and 60. Or consider a lifetime mortgage - equity release - product that allows repayments and defer starting to repay for five years. Protect any spouse or inheritance value with term life insurance.

For the five year period assume all you can do by investing is cover inflation. Too short a time frame to make other assumptions, as you sensibly would if you were planning drawdown for life instead of just five years.

Albermarle

You want to drawdown £5000 per year for 12 years

.
The OP said he can live off £1500 a month net = £18,000 pa . So with a DB scheme paying £10K pa , he needs to actually drawdown £8000 a year for 12 years.
So apart from the fund selection my guess is that the contributions would have to approx. double to achieve this aim.