How much to live on

Plasticman

Organgrinder said:

LL_USS said:

Hope you and Mrs O will arrive at a good strategy for TFLS and drawndown, @Organgrinder

I've just looked at my projection: if no career progression and retiring at 65, the DB number will be 27K/year in today's money - I am personally happy about it given the fact that sadly I have been staying at the same top of the current salary grade for 7-8 years whilst most of people from my time have already moved on much higher. I will keep on adding further into the DC pot and save what i can into ISAs/LISAs.

At this time today (more accurately at the end of Mar 2025) my number on pension account is DB = about 13K/year. I know the number suggested is about 14k/year for a minimum standard. Can a person survive okay with just over 1k/month in a relatively cheap city (no rent to be paid)? If so then I wonder if I could retire now and live on savings, wait to take work pension out at 65, and hopefully state pension will still be a thing from 68 ;-).

Just thinking of different scenarios :-). I still like to work. And also it will cost 240-250K in saving to bridge to age 65 even for this bare mimimum living standard.

I always used to look at the final figure and worked toward that.

Then I realised I'd be working will 65/66 and might not have time to enjoy my retirement for long. This was mainly cos I had a mortgage to pay off but would have left me with a pension greater than I needed.

So I started looking at the figure I wanted but subtracted the state pension. The figure was £35k. Less state pension became £23k. That gave me a possible retirement date 6 years earlier.

In order to achieve that I needed to clear a mortgage of £60k in 4 years and build up a pot of £70k to cover the years between state pension and my desired retirement age. I also wanted a buffer of £40k or so. I already had over £30k so I had a target to get £140k in 4 years. I took a lump sum and started a phased retirement, taking £14k in pensions, which is put into my pot for early retirement.

Bizarrely had I not done this my lump sum would have got smaller due to commutation factors. I got 24 -28 times the pension I gave up. 

We did the same with Mrs O's figures.

For me the extra 6 years of not working are worth the reduced pension and working part time gives me a much better quality of life.

I too was merrily plodding along until I realised that (with some effort) I could afford to live off a much lower pension and retire at 55. Two years to go and still on track. I definitely want the extra time more than the money. 

LL_USS

@Organgrinder working till 65 sounds a lot, especially when we feel we have no choice. However for now I feel I wouldn't mind working 18-20 years more, perhaps reducing the contract gradually overtime.The point I tried to make is, as my number to live on could be very low, my current DB is already just about okay, meaning the "target" could probably has been achieved even excluding state pension, given the savings I've built up. So I should take it easy in planning. When I work more, I can pass more to family.

I think I'll work at least a few more years till my second child goes to and finishes her university. Then I'll see where life takes me ;-). 

WYSPECIAL

So I started looking at the figure I wanted but subtracted the state pension. The figure was £35k. Less state pension became £23k. That gave me a possible retirement date 6 years earlier.

That's what I did too.

Cleared the mortgage and got a big enough pot to cover to state pension then stopped worrying. Didn't give up work completely but took a part time low paid job that I enjoy but know I can give up anytime I want to.

dreaming

When I was facing relocation or redundancy at the age of 58 I knew I didn't want to relocate so "practised" living on what my reduced income would be if I took my company pension then instead of at the age of 60. I didn't include the mortgage becasue I knew my redundancy payment would pay that off, and found it much easier than I thought once I had trimmed all the stuff that had crept in. So when the department moved (my last day was actually the day before my 58th birthday) I happily wished everyone well and said goodbye to working. Thanks to our wonderful pension team who gave me so much information in the months beforehand I paid part of my redundancy payment into my pension, which meant I could then take out 25% tax free and increase my monthly pension. I still ran a car and did all the things I wanted to do (although I am not a traveller so did not have that expense) and saved as well. I am so glad I did retire early as the last few years since I was 65 has seen a number of fairly major health issues which means I am less able to get out and about now (can no longer drive or walk far) so I am happy I had those years to enjoy life before illness struck. I often think of my dad who worked hard all his life and then died suddenly 3 months after he retired.

LL_USS

@dreaming good for you to have got your younger years better spent!

I myself had a bereavement in the family at a quite young age. I also have two close friends and colleagues who both have their dads passing away before reaching retirement, one of these friends still putting everything and too much into pension and spending unnecessarily too little in my opinion - the other one, whilst still working quite much, rightfully enjoying life each day.

I am like the second one! 

And I do like planning but well accept uncertainty. We never know what's around the bend. 

Organgrinder

Well yesterday my house insurance renewal came in. Higher than last year! So I tried the price comparison sites, I tried direct and both came out cheaper by £40. I phoned them, yes they'd match it but they wouldn't go further.

So I bought through Topcashback and got another £38 in cash back, a total of £78 cheaper than quoted.

Bizarrely, my clubcard quote on Tesco was £20 more expensive than through Topcashback, £58 more if the cashback is taken into consideration.

I do wonder if this is how insurance companies are getting round the thing about offering existing customers the same deal.

I decided to check out my car insurance too. At least that's looking lower!

I'm now up to over £500 on Topcashback this year too.

dunnm1

Possibly not in keeping with the thread but after my previous post on here thought I would elaborate.........

I worked close to a 6 figure job for years but with absolutely no understanding of money (not 1p in savings).

Wasn't even in the company pension scheme for years (missing out on a 10% contribution from them) doh, how dim witted am I? Kept the country afloat with my (avoidable) tax payments

Divorce changed everything, one of the biggest changes was finding here.

After a health scare (probably job stress related) I retired at 55. I had been planning retirement for about 3 years as the job had changed, more Corporate scrutiny, expected to travel again (loved Covid), almost all friends left/retired.

With the new Mrs dunnm1 we revamped the entire house including an extension that could be converted to downstairs bedroom / walk (or wheel) in shower at a later date. Chopped all trees down, paved 95% of garden (huge error).

My retirement was a big mistake, it is a cliche but I retired from something not to something. Had invested £100s in Airfix models and associated equipment but as much as I love it not for 40+ free hours each week.

Quickly resorted to my favourite pastime, cask ale! Mrs dunnm1 wasn't happy with my 5 day a week pub lunches and found me a job like hers, minimum wageish but vocational. Mrs dunnm1 has always refused to retire because she loves her job too much.

That was 12 months ago and not looked back, best job of my life, no more sinking feelings Sunday evenings, regularly do 50+ hours a week. Education, so plenty of opportunities for extra circular activities. 

We live off our wages and put into savings each month therefore I know we have more than enough to retire and live to 100+.

Unfortunately I am not sure if my knee will allow me to keep working much longer.

MarzipanCrumble

Knee - enough savings to go privately/abroad to get a fix?

dunnm1

MarzipanCrumble said:

Knee - enough savings to go privately/abroad to get a fix?

Thank you, stated was dim witted, could pass any exam put in front of me but not one ounce of common sense. Not thought of this.

MarzipanCrumble

There was a news item on BBC Wales at 6.30 pm the other day about a woman who flew to Lithuania for (I think) a knee replacement - £8k.  She is relatively yound - late 50's - and did not want to wait 2 years + to have it done on NHS.