How much to live on

Organgrinder

After a few weeks of soul searching, I've pretty much decided to retire in 2 years.

I was going to hang on for another but I've realised I need to go sooner.

The figures aren't that dissimilar......about £20k difference in savings but I think that when you know, you know.

Smudgeismydog

Huge congrats @Organgrinder
That will go so fast, and then your time becomes your own
x

Organgrinder

Smudgeismydog said:

Huge congrats @Organgrinder
That will go so fast, and then your time becomes your own
x

Thank you. A colleague is retiring shortly. He said realistically he might have 10-15 years where he had a healthy retirement and then who knows?

In two years I can retire with a pension income of approx £22k and roughly £30k in savings and a pension pot of £90k. I could work another year and make the figures roughly £23k, £40k and £100k. At 67 I'll still have savings of £90k or £110k with pensions of either £34k or £35k. An extra year of travelling seems definitely worth it.

helensbiggestfan

Great decision Organgrinder.  You'll love it.  

tiddles

That will be great Organgrinder!

We retired nearly 5 years ago, at 60 and 61, and travel is the best thing - we are about to take our 7th Interrail trip in a few weeks!

Organgrinder

tiddles said:

That will be great Organgrinder!

We retired nearly 5 years ago, at 60 and 61, and travel is the best thing - we are about to take our 7th Interrail trip in a few weeks!

Yes, we'll both be 60. And very much looking forward to not paying silly money to go in school holidays!!!

louby40

It's great feeling making that decision isn't it. I have 186 days (93 work days) until I retire from teaching. I'm going to to get another part time job though to boost my pension but my figures are £18k a year pension and I'll have £50k savings.

No mortgage or debt and my basic living expenses are approx £800 a month. I also get £5k additional income from another source.

Ive got to make it work as I'm completely done with teaching now.  

Organgrinder

It is indeed. In the end I know deep down that I'm fed up with the paperwork more than anything. Good outcomes for students require good lessons not pieces of paper detailing intervention plans!

Anyway this morning I sorted out my personal pension contributions to make sure I pay no higher rate tax. I then looked at whether to invest more and decided it was worth it on account of the tax incentives. I'm putting about £10k gross pa in over a period of 5 years and there is a £30k or so lump sum from another pension that I transferred in. So about £80k in total plus £8k growth over the past 18 months. If it grows more in real terms all well and good.

I did consider putting the money into savings but I figured that £8k pa to give a gross £10k means if it were left as cash it's worth £2.5k tax free plus £6k after tax, so £500 more than was put in .i.e. a 6.25% return. And over the next 10 years I'm hoping it grows. 

If not, my cash savings are projected to be sufficient to cover the period between retirement and SPA. Stoozing (including a mortgage stooze) will top these up by a fairly good amount in total by the time the deals come to an end too.

In addition I plan on about £4k of exam marking pa once fully retired plus the odd bit of tutoring.

Another reason for waiting 2 more years is it allows Mrs O to retire at the same time. We've built up another pot plus there's a guaranteed income from two final salary schemes.

I've mentioned before this gives us a joint income including the use of savings of £37k gross (£34k net) from age 60 and £51k gross (£46k net) from age 67.

And if we really needed to we could downsize. However I'm pretty reluctant to consider this having had a new kitchen and two new bathrooms recently!!!

Smudgeismydog

One of the things I did in the run up to retiring from work, was to salary sacrifice into my pension to such an extent I was living off my projected retirement income.
This has meant that as I moved into retirement I have not felt any difference in my income or standard of living. 

newroadahead

Going back to the subjects of POA I can say from experience they really are important.
We did POA for my DMIL as she went through dementia and organised my Ddad at the same time. So glad I did as Ddad ended up with a brain tumor and without POA I would have no say re his treatment or where he lived his final days.
Re retiring DH took early retirement in May 22, I was made redundant in July 22. Original plan was for me to work once we moved but that changed after a health scare for me after we moved.
We are happy with our lot and manage on what we have. 
DH starts his SP this month

NRA x