Planning early retirement

ajbell

We dont yet know what income he will have before state pension kicks in.
I am seriously thinking of early retirement now at 55, I will have a decent income and have good savings as well but my expenditure is not likely to be much more than the OP as I just enjoy doing things that cost nothing or very little, walking, cycling, reading etc.
Never understood the people who say wont you get bored?, no I only get bored at work.

jennyjj

Gandhi wrote: »

On a more general theme, while I’m also all for early retirement, to plan on a budget that tight would make retirement seem a bit premature.

While possible in today’s terms, there’s very little room to manoeuvre with increasing prices and surprise bills. Hopefully they don’t amount to huge amounts when averaged over time, but I think it’s something to be considered.

I too thought the budget was VERY tight. When i went through my planning, I was amazed and amused by the hundreds of pounds of 'discretionary spend' arising from just withdrawing cash from ATMs. Definitely suggest getting a gov pension quote.
I read quickly, but didn't see much detail on private pensions nor capital savings. Two massive red flags. Downsizing home carries some costs and when Son moves out, his rent/bills contribution stops. Retiring early on state pension only would be unthinkable for me. I honestly don't think the OP has the required margin for error.
Could the OP reduce his hours or days worked?

Sea_Shell

Sounds like a bit of a squeeze to me.

I was told our £15k was low!!

crv1963

Sea_Shell wrote: »

Sounds like a bit of a squeeze to me.

I was told our £15k was low!!

I agree.

I also think a lot of figures quoted in various threads do depend on personal expectations and lifestyle needs/ hopes/ wishes. The number for each of us is different. We recently took a long hard look at our number and revised it upwards. We have a must have figure, a would like figure and a luxury figure, by aiming for our upper figure we hope to land in our would like figure.

Linton

I think it is a mistake to plan retirement on a bottom up budget. You are bound to miss things and you tend to squeeze the expenditure to minimum. You have become used to a particular standard of living whilst working and being forced to live in what you would have previously considered poverty during the final 40% of your life could be very difficult.


Much better to plan on spending what you are spending now minus any major expenses that wont apply when retired. If you are going to retire on your stated budget I suggest you start keeping to it now and see how you get on.

ajbell

BUT, worth mentioning that for some the biggest luxury in life is time not money.

cloud_dog

Linton wrote: »

I think it is a mistake to plan retirement on a bottom up budget. You are bound to miss things and you tend to squeeze the expenditure to minimum. You have become used to a particular standard of living whilst working and being forced to live in what you would have previously considered poverty during the final 40% of your life could be very difficult.


Much better to plan on spending what you are spending now minus any major expenses that wont apply when retired. [INSERT] Plus additional costs [END]. If you are going to retire on your stated budget I suggest you start keeping to it now and see how you get on.

This is what I have done, utilised our current spending behaviour as the basis, removing non-ongoing costs (mortgage, etc etc) and added on additional or increased costs where it is likely. For example, heating costs will increase (for obvious reasons), fuel costs (I primarily WFH so, more time, more leisure/travel)

atush

crv1963 wrote: »

Your budget seems very low- less than 7200 pa. Have you got money for one off expenses- car/ boiler/ roof?

Work occupies a large chunk of an adults life- you need to replace it with something- what will you do with your time and how much will that cost? So what are you retiring to? Will some costs rise- petrol, heating bills, electric bills- you wont want to sit in the cold and dark staring at the wall!

i was thinking you need to budget for larger items like replacments of car/white goods.

Plus you havent budgeted for a holiday or 2.