when is enough, enough? long term planning

ffacoffipawb

NedS wrote: »

FIEW = Financially Independent, Enjoying Work?

On that assumption, I was FIHW before FIRE.

Robwales

The OP really resonates with me also - pretty similar albeit Im a bit older

• Im now very late 40s, wife doesnt work, 3 kids (big spread from 17 to 6 yrs)
• Managed to accumulate £700k DC pension + £250k Isa (wife and i) and £150k cash
• RE: pension we also pay £2880 into a SIPP for wife - didnt realise we could do this until 12 mths ago - aghhh!
• i will also get a full pension + wife will have NI credits from staying home looking after the kids to cover her (+ a few work yrs to get to full state pension when the time comes) albeit we need to top up a couple of recent years (Grrrr - we voluntarily opted out of child credit but didnt realise we didnt register my youngest - so we lost 2 yrs NI credit that they wont recover).
• Paid off mortgage / no other debt
• Im PAYE but have used up prior years pension allowance and now hit by max taper so can only do <£10k into pension each year
• If i continue to earn well (and cannot add to DC) i will keep adding to ISAs, maybe buy shares, explore VCT / EIS, or even property (but recent tax changes make this challenging according to my circumastances/maths and i have no personal interest in DIY etc)
• Am i missing any other tax efficient measures?

Wondering when i can jack it all in ie "when is enough, enough"? (work life balance very bad)

Or perhaps reduce hrs as i hit 50 - but i work for a small US company and reduced hrs / sabaticals etc isnt in the vocabulary. Will see...but i read this thread with a great deal of empathy and interest.

uk1

Robwales wrote: »

The OP really resonates with me also - pretty similar albeit Im a bit older

• Im now very late 40s, wife doesnt work, 3 kids (big spread from 17 to 6 yrs)
• Managed to accumulate £700k DC pension + £250k Isa (wife and i) and £150k cash
• RE: pension we also pay £2880 into a SIPP for wife - didnt realise we could do this until 12 mths ago - aghhh!
• i will also get a full pension + wife will have NI credits from staying home looking after the kids to cover her (+ a few work yrs to get to full state pension when the time comes) albeit we need to top up a couple of recent years (Grrrr - we voluntarily opted out of child credit but didnt realise we didnt register my youngest - so we lost 2 yrs NI credit that they wont recover).
• Paid off mortgage / no other debt
• Im PAYE but have used up prior years pension allowance and now hit by max taper so can only do <£10k into pension each year
• If i continue to earn well (and cannot add to DC) i will keep adding to ISAs, maybe buy shares, explore VCT / EIS, or even property (but recent tax changes make this challenging according to my circumastances/maths and i have no personal interest in DIY etc)
• Am i missing any other tax efficient measures?

Wondering when i can jack it all in ie "when is enough, enough"? (work life balance very bad)

Or perhaps reduce hrs as i hit 50 - but i work for a small US company and reduced hrs / sabaticals etc isnt in the vocabulary. Will see...but i read this thread with a great deal of empathy and interest.

Hi,

fwiw, I am rather an over-planner and sympathise with all that do. With such a large potential hazard of retiring from a decent lifestyle to not having enough I think is enough of an incentive. I think you have to treat planning as a pretty rough indicator and at some point look at your spreadsheets and start the countdown at say a year or two our rather than try and set something in stone 10 or 20 years out.

We retired at around 50 and we run two houses (no rental income) and two cars and on paper I wasn't sure. We travel extremely well and live very well and have found now 20 years later that at the end of the year the bank balance is more than the opening balance so we're not spending all our income. So I'd been way to cautious.

I'd try to size it and then use a degree of caution and boldness. You can within reason adjust the lifestyle if you really need to.

Good luck.

Mistermeaner

Interesting to hear the thoughts of others so thanks for contributions

It's helped focus my thinking that my questions are more philosophical in terms of work life balance than necessarily about tax optimisation etc

while not unique i guess folk my age around 40ish are somewhat the first to generally not have the security of DB and the obvious path of remaining in career to ensure that db security is obtained

We have more risk but also much greater choice and flexibility which wouldn't have necessarily been there for others

While I know come what may i should be ok in retirement i fear for friends and other folk my age who are making very little provision if any and have no plan (and worse no concept) of how they will fund retirement

I've heard "my house is my pension" and "I'll just work til I drop" a number of times

Likewise "I pay into a pension" but when digging its someone on 45k (respectable salary) who started putting 10% in after they paid off their wedding and student debt aged 35 .... Often no thought given to the pot that will produce and what that will mean

I think nationally a lot more needs to be done to communicate about pensions otherwise lots of folk will be selling their homes looking for council accommodation and having pretty miserable retirements in 10-20 years time

And just to be clear this isn't a "look at me I'm rich" boast - I earn well but live well.below my means and enjoy a lifestyle farcheaper than most

My house holidays car clothes and social life are well below the standards of my peers who i know earn well below what I do

Alexland

Mistermeaner wrote: »

It's helped focus my thinking that my questions are more philosophical in terms of work life balance than necessarily about tax optimisation etc

I recently read an article that suggested 2/3 of people earning over £100k had significant private relationship issues compared to a national average of 20% (to get past the Telegraph paywall just open the raw HTML and search for the opening text).

https://www.telegraph.co.uk/women/work/salary-sweet-spot-could-save-relationship/

uk1

Mistermeaner wrote: »

Interesting to hear the thoughts of others so thanks for contributions

It's helped focus my thinking that my questions are more philosophical in terms of work life balance than necessarily about tax optimisation etc

while not unique i guess folk my age around 40ish are somewhat the first to generally not have the security of DB and the obvious path of remaining in career to ensure that db security is obtained

We have more risk but also much greater choice and flexibility which wouldn't have necessarily been there for others

While I know come what may i should be ok in retirement i fear for friends and other folk my age who are making very little provision if any and have no plan (and worse no concept) of how they will fund retirement

I've heard "my house is my pension" and "I'll just work til I drop" a number of times

Likewise "I pay into a pension" but when digging its someone on 45k (respectable salary) who started putting 10% in after they paid off their wedding and student debt aged 35 .... Often no thought given to the pot that will produce and what that will mean

I think nationally a lot more needs to be done to communicate about pensions otherwise lots of folk will be selling their homes looking for council accommodation and having pretty miserable retirements in 10-20 years time

And just to be clear this isn't a "look at me I'm rich" boast - I earn well but live well.below my means and enjoy a lifestyle farcheaper than most

My house holidays car clothes and social life are well below the standards of my peers who i know earn well below what I do

Hi,


What I tried to do was to address those things that worried me. So for example I was concerned that one or both of us might need care in old age. So the second home which is a beach home - was bought basically as a place to retreat to for weekends and the odd holiday but also to be sold if we needed care. That has stopped that worry. I also became proficient in the travel schemes and have for example a couple of million BA miles acquired over time and relatively inexpensively and that funds a couple of trips a year in BA First assisted by Amex 241s and a few shorthall europe flights each year. Long-term relationships with the hotels we regularly stay in gives us suites and a lot of extras for peanuts. So that sort of planning ahead was very worthwhile.

I bought an extremely extravagent car some years ago - the only major car self-indulgence of my career but now as it has only 20k miles on it - it's used simply to take us to our other home. As I've lost all the cash on it I can but it's still a new car - I really don't feel competitive about the car stuff - but I need not worry about depreciation any more ... because it has happened. So now I enjoy it without fretting about it. Wife runs a much loved and well maintained elderly car and my major indulges are wine and really good food and expensive gadgets for my kitchen. But in a way it saves us a lot because I cook better than we eat out. Travel for us, particularly in Asia has always been about learning about food and I'm able to master pretty much everything we like to eat. I even have a steam bread oven and cook baguettes every day that are better than all we eat in France.

I think a lot of time - too much time perhaps - is spent worrying about pension planning and too little time is spent working out what is is you actrually want during that age. Having said that I perfectly accept that I'm in a fortunate situation (of our own making) and not many have these options.

The most important thing is in this age of enhanced stress to try and develop a healthy attitude towards what one has rather than not have and to nurture the relationship with one's partner. I have concluded after a lifetime of armagnac infused philosphy that the luckiest people in the world are';t the uber-rich but those that basically have slightly more than they really need. Too much can bring other stresses and so can too little. There is a blissful situation of "just enough".

My aimless ramblings over for today. Good luck.:)

Mistermeaner

Hi all
How quickly things can change ....
I have been head hunted for a job local to me that would in essence be 9-5 with minimal travel... It would mean taking a circa 25k pay cut (from 100k basic to 75k) and have less perks and lower bonus potential -  but would more or less mean home every night 

While that may sound a big cut when the post tax  numbers are crunched it isn't all that different (it's less don't get me wrong but the tax savings and withdrawals dropping away are significant - particularly with child benefit considerd)
If anything it's come a few years early but im kind of leaning to say stuff it I'm off
Life's an adventure after all and change can be good 
Any thoughts - I'm thinking a lot !! 

DT2001

When I was 39 we moved to the West Country from just outside London. We’ve earnt less, needed less, stressed less but had more time for our children. It has taken longer to reach ‘enough’ although that figure has changed over time and we were not as driven as some to achieve FIRE as we enjoy work most of time and are lucky to be self employed (greater control of who we work for).
As is often said on this forum we are all different so the key is working out what are your motivations and options (if you moved and it didn’t work can you find another job paying more or tied yourselves over until the right job came along?)

Stubod

..it sounds like a no brainer to me....I would take the job that minimises your stress levels and is more convenient for your location. ...one thing that money cannot buy you is more time!

Audaxer

Mistermeaner said:

Hi all
How quickly things can change ....
I have been head hunted for a job local to me that would in essence be 9-5 with minimal travel... It would mean taking a circa 25k pay cut (from 100k basic to 75k) and have less perks and lower bonus potential -  but would more or less mean home every night 

While that may sound a big cut when the post tax  numbers are crunched it isn't all that different (it's less don't get me wrong but the tax savings and withdrawals dropping away are significant - particularly with child benefit considerd)
If anything it's come a few years early but im kind of leaning to say stuff it I'm off
Life's an adventure after all and change can be good 
Any thoughts - I'm thinking a lot !! 

You have said that you live well below your means and enjoy a lifestyle far cheaper than most. So you are still going to be very comfortably-off on £75k per year, and with a better work life balance, I can't see any reason why you wouldn't want to take the new job.