Getting from 55 to 67 with a SIPP

minimalising

thanks for the replies, people.

I'll explain my circumstances and mindset on this.

I'm a Project Manager. It's a decent enough job but it does come with a degree of stress and politics. I do put extra pressure on myself I think but the job provides plenty of its own. I'm on just over £40k which is more than enough for my lifestyle.

I shouldn't complain but I do still get to work on a Monday morning and think 'UGHHH another week of this nonsense.' Especially since Bowie died. He was 69. I retire at 67 and if he can die at 69, I can for sure die at 69. And since then the news is full of men in their 60s dying.

And I don't feel like I did when I was 25 and 35. It gets harder to get out of bed, suit up and live this office life. And when I’m 50 I imagine I’ll really feel it. So I want to enjoy being off of work when I’m still fit enough to do things.

I started late but I put away £440 into a SIPP, £250 into my S&S ISA and we're overpaying the mortgage. I wished I'd started sooner but what can you do. As certain things happen (pay rises, things get paid off) I'll channel any extra money into these avenues too.

Thing is, it's taught me to live on less and I don't really want for things. I sold most of my tat last year and am not keen on replacing it, I like having space in my house and knowing that the things I want to use are right there. If I want to buy something new I tend to sell something old. I'm big into that. I’m not miserly about it, I know I can have whatever I want but I'm much more choosey about it. Like I’ve seen behind the curtain and realised that I don’t need constant retail therapy.

Also, I want to get a dog and I can't really do that while me and the wife are working full time.

So my plan is to keep earning, keep saving/investing and get out while I'm young enough and healthy enough to enjoy not working. We've not got kids, so we're not worried about leaving anything behind.

That said, it's not completely about quitting work when I'm 55 but rather having options. Knowing I can if I want to is the goal (although, yes, I'll probably want to). I will then spend my days walking my dog, baking, writing and doing old people yoga in the park and stuff like that. Every sunny day will belong to me and that'll be great. And actually I could even see me doing a bit of a part time job. Something with no stress. Maybe volunteering for the NHS in a non-office role. Like working in a shop in a hospital for a day or two a week.

kinger101

The age pop stars die is not a good method of predicting longevity. Currently the mean life expectancy for men is 18.8 years at age 65.

The problem with retiring on a rather minimal income is it doesn't leave much room for error. If you've underestimated the amount you need, or economic events erode the value of that pension, you could quickly find yourself on the breadline.

It's also hard to see how one would budget for a new boiler and second hand car on £12K a year.

Have you thought about finding another job?

crv1963

minimalising wrote: »

thanks for the replies, people.

I'll explain my circumstances and mindset on this.

I'm a Project Manager. It's a decent enough job but it does come with a degree of stress and politics. I do put extra pressure on myself I think but the job provides plenty of its own. I'm on just over £40k which is more than enough for my lifestyle.

I shouldn't complain but I do still get to work on a Monday morning and think 'UGHHH another week of this nonsense.' Especially since Bowie died. He was 69. I retire at 67 and if he can die at 69, I can for sure die at 69. And since then the news is full of men in their 60s dying.

And I don't feel like I did when I was 25 and 35. It gets harder to get out of bed, suit up and live this office life. And when I’m 50 I imagine I’ll really feel it. So I want to enjoy being off of work when I’m still fit enough to do things.

I started late but I put away £440 into a SIPP, £250 into my S&S ISA and we're overpaying the mortgage. I wished I'd started sooner but what can you do. As certain things happen (pay rises, things get paid off) I'll channel any extra money into these avenues too.

Thing is, it's taught me to live on less and I don't really want for things. I sold most of my tat last year and am not keen on replacing it, I like having space in my house and knowing that the things I want to use are right there. If I want to buy something new I tend to sell something old. I'm big into that. I’m not miserly about it, I know I can have whatever I want but I'm much more choosey about it. Like I’ve seen behind the curtain and realised that I don’t need constant retail therapy.

Also, I want to get a dog and I can't really do that while me and the wife are working full time.

So my plan is to keep earning, keep saving/investing and get out while I'm young enough and healthy enough to enjoy not working. We've not got kids, so we're not worried about leaving anything behind.

That said, it's not completely about quitting work when I'm 55 but rather having options. Knowing I can if I want to is the goal (although, yes, I'll probably want to). I will then spend my days walking my dog, baking, writing and doing old people yoga in the park and stuff like that. Every sunny day will belong to me and that'll be great. And actually I could even see me doing a bit of a part time job. Something with no stress. Maybe volunteering for the NHS in a non-office role. Like working in a shop in a hospital for a day or two a week.

I don't want to rain on your parade but...........there are several flaws with your thinking that I can see.

Judging your chances of living past your 60s by someone elses death not related to you is a none starter. You need to look at your family- are they well aged? Then your lifestyle.

I'm 56 and we're planning on retiring soon, but even living a frugel lifestyle 12k will be a struggle, especially if you need to replace things that do cost such as a roof, a boiler or a car.

We're getting our home ready for retirement so having to spend savings to do that, I appreciate that your home may be how you want it now, my Mum age 80 thought that when she retired age 60........has just spent 3k on a new gas fire, her old one was fine but from the 1980s and she was fed up of it. New carpets because the old ones looked a bit tatty etc....

Getting a dog? Great, you could be lucky and never need to use a vet other than routine vacinations or......you could be unfortunate and get a dog like ours that has had 6k of operations for cancer of the jaw (now fully recovered but also on a special diet for life at £60 every four weeks) or a diabetic dog like our other dog- developed at age 18 months.....ongoing costs around £3-400 per month. Even if we'd insured them, the diabetic dog would by now (age 6) have exhausted any payout.

I understand the need to keep earning to finance the future retirement but I think you're aim is for too low an income, we worked out our money and came to three figures-

1) Have to have income to live a basic retirement- £18k pa
2) Would like to have, comfortable retirement- £24-30k pa.
3) Luxury retirement £32k plus.

Our aim is to try to fall into section 2 in our 50s and when we hit SPA likely to hit into section 3. I appreciate my having a DB Pension makes us more secure when we retire but we're also saving into SIPP and Auto-Enrolled Pension for my wife along with an existing DC Pot she has. Even so we'll end up drawing her SIPP to zero age 55-67.

Albermarle

Also, I want to get a dog

I got a mongrel dog I thought on the cheap from Dogs Trust - £80 including vaccinations .
With food/treats - insurance - routine vets bills ( never covered by insurance ) - kennels for a week or two each year - quarterly hair cut etc etc = about £1000 pa ( can be more )
Then like the poster above - at 9 years old - £6000 in cancer treatment ( now OK ) - only £1.5K covered by insurance and insurance premiums tripled to £500 pa ,

If you get a dog you add better increase that £12k pa …..

MallyGirl

I try not to think about just how much our 2 dogs cost us and, thankfully, to date they have never been ill. It does all exist in spreadsheets but I have avoided adding all the amounts up! Admittedly they are big pedigree dogs.

crv1963

Both of ours were rescue dogs, had both a while before their ailments hit them. I know my Mum has spent £600 this week on vet bills for her dogs, one being speyed the other on biopsy on some lumps but luckily the lumps were just fatty tissue.

ScoobyZ

Remember you can take your NHS pension earlier (with a reduction).

I'm have a Boot pension and an NHS and will be opening a sipp with the aim to retire earlier.

Aim to plit similar to you:

55 Boots/Sipp/Savings (6k/7k/7k)
60 Boots/NHS/ Savings (6k/9k/5k)
67 Boots/NHS/State (6k/9k/9k)

Plus the wifes pension about 11k also can also down size or sell a property we have abroad or a combination of both.

NedS

kinger101 wrote: »

The problem with retiring on a rather minimal income is it doesn't leave much room for error. If you've underestimated the amount you need, or economic events erode the value of that pension, you could quickly find yourself on the breadline.

It's also hard to see how one would budget for a new boiler and second hand car on £12K a year.

I completely agree.

We live what I consider to be a very frugal lifestyle atm as we continue to save hard for early retirement, and our current spending is around £20k pa with no housing costs.

We are budgeting for £25k pa income fully utilising our 2 x tax free allowances to cover essential living costs for early retirement, with some cash savings in reserve for emergencies. I can not see how anyone could manage on £12k pa for any length of time without having significant reserves to draw upon when needed.

minimalising

Again, thanks for the replies. It should be stated that as of right now the 12k figure is my minimum and that over the next ten years I will channel more money in as I get it.

In terms of family, it's just me and the missus. We never had kids and so that does make things easier a bit. Also, she's likely to work a little longer than me as her job is easier and less stressful.

waveydavey48

Interesting thread, thanks "minimalising".
Quite a lot chimed with me so I will add my four pennorth for what it's worth.
I went from loving my career to disliking it and at age 52 downshifted to a basic part time job (call taker at police) which was very interesting.
I retired last year at 57 having known a few people who died before 60 after working hard all their lives.
I'm happier now than ever.
We adopted 2 retired racing greyhounds and love them. They are so sweet natured and gentle as a breed that they make ideal therapy dogs and visiting local hospitals/hospices is something I would love to do if our 2 were suitable (they are too nervous).
So, if you can make it work financially go for it, and a little part time job can ease you into full retirement.
Good luck.