Confidence on when to "go" 28 February 2020 at 11:26AM in Pensions, Annuities & Retirement Planning 14 replies 933 views

Icantwait

I will 57 next month and I am not sure if I have the stamina to keep going to my planned retirement age of 60.

Currently I have £660k in two funds and am contributing about £26k per annum.  My forecast calculations suggest this could give a total pot of about £800-826k in 3 years.
I have shareholdings which already exceed the small amount left on the mortgage.
Currently I hold £30k cash and forecast I will have about £50-70k in "cash" by the time I hit 60.
State pension is fully paid up and will be paid at age 67.
My wife has a forecast Public authority pension of about £9k coming in 4 years and she is fully paid up for the state pension at age 67. 
The kids are mostly gone (are they ever?).
I am happy that, with the above, we can retire with some confidence about quality of life including being able to afford to be active and travel a bit.

However I am looking at perhaps bringing forward retirement by a couple of years.  I reckon by March 2021 the pot will be about £710k.
The problem is I don't have "real world" confidence that the loss of £115k in pot value plus 2 extra years of living costs will not have a significant impact.  My wife would keep working until 60 - she has been part time for many years - this would be my reward for not having any career breaks etc.

What would you do?

rawhammered

id retire now

Dazed_and_C0nfused

State pension is fully paid up and will be paid at age 67.
My wife has a forecast Public authority pension of about £9k coming in 4 years and she is fully paid up for the state pension at age 67. 

Have you actually checked both State Pension forecasts on gov.uk and read past the likely headline of £168.60 to see what has been accrued to date (details normally to 05:04:2019 at present)?

crv1963

Go when you feel you have enough to provide for your needs. If what you have is enough now, then why not? If you feel the need for more work a bit longer, you cannot buy time but it is also about what you do with your time, worrying about money should not be one of them.

Linton

Icantwait said:

I will 57 next month and I am not sure if I have the stamina to keep going to my planned retirement age of 60.
.........
The problem is I don't have "real world" confidence that the loss of £115k in pot value plus 2 extra years of living costs will not have a significant impact.  My wife would keep working until 60 - she has been part time for many years - this would be my reward for not having any career breaks etc.

What would you do?

If you have a spreadsheet plan based on pessimistic assumptions and you know how much income/year you need why the lack of confidence?  You can always extend your planning with a few serious but not wildly unlikely what-if case studies.

A small number of extra years living costs should not matter much as your planning for the next say 35 years should be close to long term stability anyway.  The issue is more whether a sustainable withdrawal from the pot plus state and other pensions is sufficient to meet your needs.

whizzywoo

Go now, you never know what's round the corner.  Enjoy yourself while you still have your health.  You can only live one day at a a time and that day is now!

Albermarle

I would only say you seem somewhat too confident in your forecasts of pot size.
Now you have £660K , you will add £26K ( + maybe some tax relief) and then it will be £710K . Not too unrealistic , although this weeks 'market correction ' maybe knock it off course a bit .
However you say in three years £660 k + £78K ( + tax relief ?) = £800/£826K  , which is around a 9% growth rate which seems very ambitious

Dazed_and_C0nfused

And is it £660k today or was that a valuation from a few days ago? 

Icantwait

Dazed_and_C0nfused said:

State pension is fully paid up and will be paid at age 67.
My wife has a forecast Public authority pension of about £9k coming in 4 years and she is fully paid up for the state pension at age 67. 

Have you actually checked both State Pension forecasts on gov.uk and read past the likely headline of £168.60 to see what has been accrued to date (details normally to 05:04:2019 at present)?

Yes.  I have the full list of 35 years during which I have made contributions,  Only 3 are less than the minimum.

Icantwait

Dazed_and_C0nfused said:

And is it £660k today or was that a valuation from a few days ago? 

Today - an hour ago.  Interestingly it has grown £6k between 20 and 28 February!

Icantwait

Albermarle said:

I would only say you seem somewhat too confident in your forecasts of pot size.
Now you have £660K , you will add £26K ( + maybe some tax relief) and then it will be £710K . Not too unrealistic , although this weeks 'market correction ' maybe knock it off course a bit .
However you say in three years £660 k + £78K ( + tax relief ?) = £800/£826K  , which is around a 9% growth rate which seems very ambitious

Not sure where you get 9% from.
A 3% (net of fees) growth uncompounded, over three years on £660k is £78k plus £80k contributions = £799k.
Add in some further increases on my and my employer's contributions, plus compounding and £800-826 doesn't seem unrealistic.