It's time to start digging up those Squirrelled Nuts!!!!

Parking_Trouble

Sea_Shell wrote: »

I can totally relate to that!!

Have faith in the spreadsheet, all hail the spreadsheet!!

After a week and a half and last salary payment it's OK at the moment. We'll be alright within a few months when it settles down and the wife realises the magic money tree has gone :rotfl:

enthusiasticsaver

Parking_Trouble wrote: »

This is my eighth day of retirement.

From the age of 17 I've never had to think about money because I've always earned good money. Been in DB pension schemes too, so that has been worry free.

Past 3 years or more I've been annoying the wife by creating numerous spreadsheets and looking at them and tweaking them daily.

I've been agonising about whether I could afford to stop work. The spreadhsheets told me I could but I had to keep checking.

Now I've made the leap I'll still be worrying about whether I've got the figures right for income and outgoings and whether the investments will perform well enough to pay for the exotic holidays and cover major emergencies.

Hopefully in a few months it'll settle down.

Because I've saved hard in the past few years we'd already got used to having a much reduced income so not a massive step. Just the change to start using savings to top things up until SP kicks in, in 5 years.

Loving it so far though, no longer tied to the work phone and laptop and not enough time to do all the things that interest me.

Congratulations on your retirement. I retired 18 months ago and DH retired around 2.5 years ago and had an 8 year gap between retirement and SPA.

It is difficult adjusting to lower income but like you we had been saving/investing in the 5 years prior to retirement and our IFA has mapped out our cashflow to supplement my spreadsheet and said we can afford to withdraw £20-£30k per annum on top of our DB pensions conservatively from now until we are 99 to get our investments to nil. As we have savings to cover the next 3-4 years we should be ok.

As our DB pensions comfortably cover essential expenditure it is only holidays and home improvements that £20-£30k needs to cover but I constantly question the numbers too.

enthusiasticsaver

bostonerimus wrote: »

One difficulty with drawdown planning is spending variability. It's easy enough to do a budget for regular items like food, utilities and taxes etc, but irregular large costs are often missed. You need to have a plan to replace your car, do major home renovations and the worst one of all, pay for long term care. So if your budget is 20k could it stand to be 30k or 40k for a couple of years when you need to buy a new car and replace your central heating?

Of course regular spending does decrease as people age and become less active, but then there are often large costs in the last years as help is required with aspects of daily life and maybe a care home stay. This wasn't much of a worry 30 or 40 years ago, but current government and local authority funding and policy means that it must be considered today.

I totally agree. All advice we have received is that spending is high initially on long haul holidays, home renovations etc and my experience is that this is spot on. It will settle down to just maintenance and decorating next year though and we have two cars so hopefully by the time one needs replacing we will feel ready to downgrade to just one car between us rather than one each. Few years left in both of them though as we do less mileage now opting for train travel for long distance in UK.

Care costs of course will need to be factored in but we have a house to sell if there is just one of us. Our IFA gave us an average of £70k on residential care costs which is apparently around 3 years which is average time spent in a care home if needed. We will have combined annual income once SP kicks in of around £52k so that should go someway towards it but of course that is just for one of us so we will need to either sell our house or investments. I am not worrying about it for now though.

enthusiasticsaver

Spider_In_The_Bath wrote: »

We live on about 18 thousand a year. Everything else we earn is saved for FIRE (hopefully in about 5 years' time).

We run two cars, have a pet, go on holidays and days out etc. easily on the 18 thousand.

When I see people wanting retirement funds of 30 - 40 thousand a year I have no idea what they would spend the money on.

We spent less when working than we do now surprisingly enough. Entertainment is higher, eating out is higher, theatre tickets, leisure club membership. Taking our grandchildren and family out for meals or days out or even holidays. More holidays than when working and more weekends away and more spent on hobbies. £18,000 would not cover our expenses. Nowhere near but now we have time to do things we don't want to skimp due to cost. House renovations as one offs are now coming to an end thankfully and we did splash out on e bikes.

That is what we spend our pensions and savings on and many of our retired friends are the same. We can easily spend £30k - £40k a year but we saved for a comfortable retirement and even when working we were spending around £30k and investing/saving around £15k a year plus a further £6-£10k on pension contributions. Depends on your lifestyle.

jimi_man

Spider_In_The_Bath wrote: »

We live on about 18 thousand a year. Everything else we earn is saved for FIRE (hopefully in about 5 years' time).

We run two cars, have a pet, go on holidays and days out etc. easily on the 18 thousand.

When I see people wanting retirement funds of 30 - 40 thousand a year I have no idea what they would spend the money on.

I'd be interested to see a rough breakdown of your costs, if you're willing to share. I always find it interesting looking at other people's expenses and seeing where we can save. Your circumstances seemed very similar to ours as we ran two cars and up till recently, a dog.

The dog was very expensive, mainly vet bills, as the insurance just wouldn't cover things when it came down to it. Really put me off pet insurance.

Parking_Trouble

jimi_man wrote: »

I'd be interested to see a rough breakdown of your costs, if you're willing to share. I always find it interesting looking at other people's expenses and seeing where we can save. Your circumstances seemed very similar to ours as we ran two cars and up till recently, a dog.

The dog was very expensive, mainly vet bills, as the insurance just wouldn't cover things when it came down to it. Really put me off pet insurance.

I've gone through our monthly expenses and I could never get down to £18,000 pa unless we became complete hermits and that completely undermines the point of me retiring.

We currently have two cars and a dog. At some point it will be one car when the wife retires. My car is 15 years old (had it from new) still going strong and I will run it into the ground.

Even with one car, minimal holidays/going out/sundries/takeaways/clothes/house maintenance I'm struggling to get down to £27k and that's the 'minimum' net income required after tax!

I know people do fantastic things on limited budgets and we (the WIFE and I) need to change our approach to spending in retirement, but we've got some way to go before it's optimal.

bluenose1

JoeEngland wrote: »

We started doing a lot of our shopping at Lidl last year having previously avoided it due to nothing other than snobbery, and had been doing our main shop at Sainsburys. Each week I bore my wife by still sounding amazed at how much we're saving! There's only a few things we either can't get at Lidl or have tried and not liked. The fruit and veg from Lidl seems to last longer which is another benefit. There's an Aldi opening soon nearby so we'll try that. I think the gravy train days for the big name supermarkets are coming to an end because of Lidl and Aldi.

I like Home Bargains and B&M etc. Really good value for toothpaste, kitchen cleaned etc and although not a massive range of food really good value. Not sure if I should say this but I love Home Bargains toilet paper, much better than all the expensive brands I have tried:).

BoxerfanUK

bluenose1 wrote: »

I like Home Bargains and B&M etc. Really good value for toothpaste, kitchen cleaned etc and although not a massive range of food really good value. Not sure if I should say this but I love Home Bargains toilet paper, much better than all the expensive brands I have tried:).

On the subject of saving on grocery shopping (I know this is the pensions board btw ) I like to use the 'MySupermarket' app on my phone quite a bit. I'm not talking about saving 10p on a can of beans or anything like that, but as an example, we love 'Yorkshire Tea' so that's the only tea we buy. If I need some 'tea' on my next shop I check out the app to see where it's cheapest and buy it there. Today as an example it's currently on offer at Tesco and Sainsburys for £4.50 for 240 bags, Asda. Ocado and Waitrose £6.99 and Morrisons £6.00 so a £2.49 saving on one item.

On the app I create and keep 'lists' of the more expensive groceries I buy and then do a quick compare on the app to find the cheapest place. Another example, the Toothpaste we like, usually £4.50, currently £2.00 so we stock up.

Of course if you live miles away from supermarkets then maybe not so practical but we are 5-10 mins max from all of them so no trouble.

Suffolk_lass

Parking_Trouble wrote: »

I've gone through our monthly expenses and I could never get down to £18,000 pa unless we became complete hermits and that completely undermines the point of me retiring.

We currently have two cars and a dog. At some point it will be one car when the wife retires. My car is 15 years old (had it from new) still going strong and I will run it into the ground.

Even with one car, minimal holidays/going out/sundries/takeaways/clothes/house maintenance I'm struggling to get down to £27k and that's the 'minimum' net income required after tax!

I know people do fantastic things on limited budgets and we (the WIFE and I) need to change our approach to spending in retirement, but we've got some way to go before it's optimal.

Our expenses are £10,500 on all the things that hit the account - plus £3000 for all housekeeping, £1000 for commuting and fuel and £5k for pleasure (hols, treats and going out) occasionally we exceed this last heading. I anticipate commuting will reduce as pleasure increases with retirement. Our joint DB pensions are more than this, allowing for some flex and we might also give up one car in due course.

We run 2 cars, a motorhome, two motor-bikes and are a household of (normally) 2, sometimes more plus a cat.

The biggest saving is housekeeping - if you want to see how much you can save, go over to Old Style on the forum and read the first post on the monthly grocery challenge here.

BoxerfanUK wrote: »

On the subject of saving on grocery shopping (I know this is the pensions board btw ) I like to use the 'MySupermarket' app on my phone quite a bit. I'm not talking about saving 10p on a can of beans or anything like that, but as an example, we love 'Yorkshire Tea' so that's the only tea we buy. If I need some 'tea' on my next shop I check out the app to see where it's cheapest and buy it there. Today as an example it's currently on offer at Tesco and Sainsburys for £4.50 for 240 bags, Asda. Ocado and Waitrose £6.99 and Morrisons £6.00 so a £2.49 saving on one item.

On the app I create and keep 'lists' of the more expensive groceries I buy and then do a quick compare on the app to find the cheapest place. Another example, the Toothpaste we like, usually £4.50, currently £2.00 so we stock up.

Of course if you live miles away from supermarkets then maybe not so practical but we are 5-10 mins max from all of them so no trouble.

I also keep a £400 portion of my annual grocery budget for stores and my preferred brands. I only ever buy them on offer and in multiples of 4-6 - I run a shopping list on the wall when/if I get down to one spare I do the same as you, and occasionally try something new, in case I could drop a brand without noticing.

I also look at YS (that is yellow-sticker or the reduced sections to those who don't know) especially for things in my meal-plan and especially meat and fish - my local SM (supermarket) of choice occasionally gets an over-order and it goes YS well in date, as well as the usual options. It helps to keep the mealplan loose, and to grow some veg and fruit at home.

My budget is £200 per month, doubled to £400 in December for everything else - so 11x£200, 1 x£400 and £400 for stores. We live well. Aside from a bit of cat litter, and occasionally some cat food (from trips to Pet superstore), that is it. We do not have pet insurance for reasons others have given.

Sea_Shell

Well it's nearly here!!!! Just 20 hours to go!!!

Question, in these circumstances, do you usually get paid as normal on the standard payday i.e. 25th (albeit pro-rata) or should I get paid up on my last day?? Or does it vary from Co. to Co. ??

I've had no correspondence or acknowledgement from HR at all !!!