Can I now kick back and cruise to the finish line?

DrDT

Seems like there are a few evaluate my plan threads so here's another, Im looking at if we have enough to bridge the gap from 55 to state pension age. Simplified numbers below:
Currently 51, planning on retiring at 55 with my OH, we are the same age.
Currently have £470 k in DC pensions and S&S ISA.
At 60 I get 7 k DB pension and OH gets 8k DB with 24k  lump sum.
From 67 another db kicks in which together will full state pensions means our needs are covered so just need to get to 67.
Desired income is 40k/yr from 55 to 59 and 36k/yr from 60 on.
So 55 to 59 needs 5x40k=200k 
60 to 66 need 7x (36-7-8)=147k
So we need 347k to get to 67, assuming investments keep pace with inflation, allowing for a 30% crash/contingency means 347/0.7=495k, which between the DC and lump sum we have.
Is that enough of a buffer ? And can I now kick back for the last few years till 55 and drop to p/t hours or a low stress job and not worry about adding more to the pot so cruising to the finish line?

AlanP_2

It's a YES from me.

It looks like you have "won" and achieved your goal, as long as your income requirements have been calculated correctly and your investments are not off the risk scale. Have you allowed for large, irregular expenses like changing car(s) etc?

I guess you will still be accumulating, albeit at a slower rate, if you go P/T or change roles so your buffer is likely to grow a bit.

83705628

Short answer: you're sorted.

Long answer:
Breakdown the 470 into how much is DC and how much is ISA would be helpful because obviously you don't need to worry about the effect of tax on take home. Also, how much is in your name how much is in OH's name?

Cab you take any of your db pension early? What schemes are they in? Do they have a modeller or actuarial reduction calculator?
Generally, dB schemes work out about the same if you live to life expectancy (I.e. 7k from 60 to LE ~ 85 is 175k total in real terms, say it's ~4% less if taken from 59, you'll probably still end up getting 175k total over your lifetime). Also check if your OH's lump sum is automatic or if it can be converted into extra income. If so, if the commutation rate is £1 income = £12 lump sum it isn't worth it, but my dad has a USS pension and they concert £1 income into £23.50 lump sum and since he's retiring at 60, and his dad died at 82, and it's not a huge pension only lose £200 pa if taken the default option

The way I'm working it out for my mum and dad is working back from total income after the state pensions, using that as a target income to acheive between target retirement age 60 and then.

Obviously this is only a rough post but make sure you plan out each year in detail and work out the effect of taxes of drawdown from DC pens.

Your plan sounds like you're sorted as long as any reduced income is at least enough to comfortably cover cost of living between now and 55.

Your investment plan is very conservative which is good - planning for a 30% crash and only an inflation return.

The only iffy thing is that your 470k is for short-ish term use between 51 and 67, so conventual wisdom says lean towards bonds or cash. But because of negative real yields you need to lean towards equity to get a worthwhile return.

Notepad_Phil

DrDT said:

From 67 another db kicks in which together will full state pensions means our needs are covered so just need to get to 67.

One thing to consider is will there still be enough income for when one of you is no longer around? You'll lose one of the state pensions and possibly 1/2 or more of whatever DB pensions that person had, so just make sure that you've covered for that eventuality before you do kick back and relax.

Albermarle

No mention of cash savings ? 
Useful for short term emergencies but even more useful if markets turn bad .
If your investments went down 30% , it is better to stop ( or at least reduce) taking money from them until they recover, and live off cash . 

Dox

DrDT said:

Is that enough of a buffer ? And can I now kick back for the last few years till 55 and drop to p/t hours or a low stress job and not worry about adding more to the pot so cruising to the finish line?

All depends on your attitude to risk...

DrDT

Thanks for the responses everyone, a few good points to consider. One is how the DB pensions split with spousal benefits as Im not sure about this. We do have bit of a cash buffer, but I also need to look closely at asset allocation for the investments as there is no coherent portfolio, just a collection of ex employer pensions and a bit of a hotch potch DIY ISA.

Thrugelmir

DrDT said:

Desired income is 40k/yr from 55 to 59 and 36k/yr from 60 on.

Gross or net? 

83705628

neilnockie said:

tcallaghan93 said:

Short answer: you're sorted.

Long answer:
Breakdown the 470 into how much is DC and how much is ISA would be helpful because obviously you don't need to worry about the effect of tax on take home. Also, how much is in your name how much is in OH's name?

Cab you take any of your db pension early? What schemes are they in? Do they have a modeller or actuarial reduction calculator?
Generally, dB schemes work out about the same if you live to life expectancy (I.e. 7k from 60 to LE ~ 85 is 175k total in real terms, say it's ~4% less if taken from 59, you'll probably still end up getting 175k total over your lifetime). Also check if your OH's lump sum is automatic or if it can be converted into extra income. If so, if the commutation rate is £1 income = £12 lump sum it isn't worth it, but my dad has a USS pension and they concert £1 income into £23.50 lump sum and since he's retiring at 60, and his dad died at 82, and it's not a huge pension only lose £200 pa if taken the default option

The way I'm working it out for my mum and dad is working back from total income after the state pensions, using that as a target income to acheive between target retirement age 60 and then.

Obviously this is only a rough post but make sure you plan out each year in detail and work out the effect of taxes of drawdown from DC pens.

Your plan sounds like you're sorted as long as any reduced income is at least enough to comfortably cover cost of living between now and 55.

Your investment plan is very conservative which is good - planning for a 30% crash and only an inflation return.

The only iffy thing is that your 470k is for short-ish term use between 51 and 67, so conventual wisdom says lean towards bonds or cash. But because of negative real yields you need to lean towards equity to get a worthwhile return.

This makes no sense at all. You need to transfer your DB cash into a DC pension and then invest in funds you're certain will achieve double figure returns. Think 12,13,15% - forget the stock market 'average'. You need to PAY for premium returns. 

/
Jesus Christ this poster is here as well. Ignore them, they're talking nonsense.

Albermarle

neilnockie said:

tcallaghan93 said:

Short answer: you're sorted.

Long answer:
Breakdown the 470 into how much is DC and how much is ISA would be helpful because obviously you don't need to worry about the effect of tax on take home. Also, how much is in your name how much is in OH's name?

Cab you take any of your db pension early? What schemes are they in? Do they have a modeller or actuarial reduction calculator?
Generally, dB schemes work out about the same if you live to life expectancy (I.e. 7k from 60 to LE ~ 85 is 175k total in real terms, say it's ~4% less if taken from 59, you'll probably still end up getting 175k total over your lifetime). Also check if your OH's lump sum is automatic or if it can be converted into extra income. If so, if the commutation rate is £1 income = £12 lump sum it isn't worth it, but my dad has a USS pension and they concert £1 income into £23.50 lump sum and since he's retiring at 60, and his dad died at 82, and it's not a huge pension only lose £200 pa if taken the default option

The way I'm working it out for my mum and dad is working back from total income after the state pensions, using that as a target income to acheive between target retirement age 60 and then.

Obviously this is only a rough post but make sure you plan out each year in detail and work out the effect of taxes of drawdown from DC pens.

Your plan sounds like you're sorted as long as any reduced income is at least enough to comfortably cover cost of living between now and 55.

Your investment plan is very conservative which is good - planning for a 30% crash and only an inflation return.

The only iffy thing is that your 470k is for short-ish term use between 51 and 67, so conventual wisdom says lean towards bonds or cash. But because of negative real yields you need to lean towards equity to get a worthwhile return.

This makes no sense at all. You need to transfer your DB cash into a DC pension and then invest in funds you're certain will achieve double figure returns. Think 12,13,15% - forget the stock market 'average'. You need to PAY for premium returns. 

The poster just appeared yesterday and has made the same wild comments on a few threads. 

Clive_Woody

Albermarle said:

neilnockie said:

tcallaghan93 said:

Short answer: you're sorted.

Long answer:
Breakdown the 470 into how much is DC and how much is ISA would be helpful because obviously you don't need to worry about the effect of tax on take home. Also, how much is in your name how much is in OH's name?

Cab you take any of your db pension early? What schemes are they in? Do they have a modeller or actuarial reduction calculator?
Generally, dB schemes work out about the same if you live to life expectancy (I.e. 7k from 60 to LE ~ 85 is 175k total in real terms, say it's ~4% less if taken from 59, you'll probably still end up getting 175k total over your lifetime). Also check if your OH's lump sum is automatic or if it can be converted into extra income. If so, if the commutation rate is £1 income = £12 lump sum it isn't worth it, but my dad has a USS pension and they concert £1 income into £23.50 lump sum and since he's retiring at 60, and his dad died at 82, and it's not a huge pension only lose £200 pa if taken the default option

The way I'm working it out for my mum and dad is working back from total income after the state pensions, using that as a target income to acheive between target retirement age 60 and then.

Obviously this is only a rough post but make sure you plan out each year in detail and work out the effect of taxes of drawdown from DC pens.

Your plan sounds like you're sorted as long as any reduced income is at least enough to comfortably cover cost of living between now and 55.

Your investment plan is very conservative which is good - planning for a 30% crash and only an inflation return.

The only iffy thing is that your 470k is for short-ish term use between 51 and 67, so conventual wisdom says lean towards bonds or cash. But because of negative real yields you need to lean towards equity to get a worthwhile return.

This makes no sense at all. You need to transfer your DB cash into a DC pension and then invest in funds you're certain will achieve double figure returns. Think 12,13,15% - forget the stock market 'average'. You need to PAY for premium returns. 

The poster just appeared yesterday and has made the same wild comments on a few threads. 

And no doubt is hopefully people will send him/her a PM asking how they achieve such fantastic returns.....and that's when the scam starts