How much to live on

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/82004667#Comment_82004667

Having some night time fights with my chimp/lizard brain though that seem to think it's a crazy idea to give up a well paid, secure job, presumably not alone in having this fight?

There are regular threads on the pensions board on this topic. The classic trap is to keep doing OMY ( one more year) just in case.

A lot of it comes down to whether you still enjoy your job, or not, and/or whether you are the type who will enjoy retirement with plenty of plans, hobbies,holidays and a good social life.

No point sitting at home twiddling your thumbs/bored and missing work, just because you can afford not to work. On the other hand as the saying goes, nobody on their deathbed wishes they had gone to the office more often.

So it is a kind of dilemma that you can only resolve yourself, as financially you seem fine to go .

Albermarle

Current plan is to purchase an RPI linked joint annuity, hang on to the tax free lump sum for future big ticket items and downsize next year.

I was not aware you could get a joint annuity, so I looked it up. It seems calling it a Joint annuity is a bit misleading as it implies you take it out jointly, but you do not. One person takes it out, but if that person dies first, the same income continues to the survivor. It would be more accurately described as an annuity with a 100% spousal benefit, whereas typically it is only 50%, or none at all.

At least I have learned something today 🙂

HUSKYPAL

https://forums.moneysavingexpert.com/discussion/comment/82004847#Comment_82004847

I agree, very easy to slip into the just one more year mentality, i'm not going to do that. I definitely don't hate my job, but there are lots of other things I'd rather be doing than sitting staring at a screen for 8 hrs a day. I'm happy with the decision, just need to convince the chimp.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/82004885#Comment_82004885

I left a well paid job that I did not hate and got on well with colleagues, my boss etc. I was also a but wary about giving up the regular income.

However the job included quite a lot of travelling, which I thought I was generally OK with . Then it stopped during Covid, and the thought of going back to all those long drives/traffic jams/ airport queues'/ plane delays/ hotels etc prompted me to decide to hand in my notice.

Organgrinder

https://forums.moneysavingexpert.com/discussion/comment/82004898#Comment_82004898

I think when you know, you know!

I genuinely enjoy my job. But I like the idea of having more time to myself.

I fully intend to do more cycling, do more cooking from scratch, and improve my guitar skills.

Our combined income is ok for our needs. Approx £4,200 month after tax. No mortgage. No loans. And a reserve pot in case of emergencies.

If I overthink it, I'll end up saying one more year. So I won't!

Savvy_Sue

https://forums.moneysavingexpert.com/discussion/comment/82004862#Comment_82004862

Worth saying that anyone considering this might want to go for it with the less healthy person in the relationship, you'll get better rates, AIUI. Although it might depend on the payment period, I guess, so speak to your advisor.

MarzipanCrumble

As a couple we 'bought' a Standard Life Annuity with 50% payment on death of holder (husband) for wife and 4% flat pa increase. Can't remember when we bought it - think poss around 2007-8. Husband died, I get 50%. Bargin with 4% increase per annum!

(did get IFA advice)

TallGirl

Really interested in the car chat too as having moved to Denmark (my original home country) last Aug I am still driving my dads beat up old car. I am looking at going electric possibly the new Epic but cars are super expensive here due to taxes. My sister has just got the Elroq so will learn from them for sure. They have solar panels which is ideal something I do not.

As for stopping work I will share my story (I do also have a diary where I waffle on a lot mainly non MSE related content). I am sorry if I have already shared it before but i love this thread.

I cleared my mortgage 9 years early (thanks to MSE and MFI3 challenges). My marriage broke up I moved and rented out my place until I could sell it and buy something I thought was my forever home. We added £20K to the house we bought and paid for renovations out of savings. We then decided it was time to move closer to family as my partner can work remotely whereas I could too just not in a different country. We managed to sell the house and made no loss or gains but it was a tricky house to sell and it went to a good family and timings worked out for the house we could buy here in Denmark. It is a 2011 bungalow with all mod cons. Super insulated and a heat pump with pipes dug in the ground only 1 year old. Future proof due to it being a bungalow and low maintenance as it is so new.

It is bigger than what we had an we have a lot of land too but was able to put £100K in the bank which helped the move obviously. I was made redundant so £15K in my pocket and DG kept her part time job and is self employed. We started a newish venture getting our own clients making more profit but it is a lot more work. I do the marketing and so far we have only had 2 playing clients so not perfect but I am confident it will grow.

I am 56 this year and partner is 61. We both have tiny DC pensions hers in payment (£200p/m) mine will be at 60 and is a bit more. Partner has £30K in her DC pension and I have about 4300K (pension), £120K investments plus £100K premium bonds but no income as such. We have some cash savings but obviously being spent. Partner has some high paying work coming in but there is a lot of tax to pay in Denmark. You actually pay tax on even your pensions if they have risen in value so that is before you start drawing them.

Anyway I did the sums but was not 100% sure but we still moved. We are loving life here and would not swap back to the UK. We hope to grow the new business side and be able to not eat too much into our savings. Last big expenditure will be the car which actually started me doing this post. Sorry for the waffle I will go back to lurking.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/82005174#Comment_82005174

According to various threads on the pensions forum, there is little advantage, or disadvantage to buying a standard annuity via an IFA. Unless as you mention you are looking for an enhanced annuity due to health /shortened life expectancy/being a smoker reasons. In this case an IFA can probably find a better deal.

Organgrinder

I keep changing my mind with regard buying an annuity - basically the idea of having an additional income between the ages of 61 and 67 appeals to me. However, realistically I won't need to take any money out of my pot unless I have an unexpected emergency and it will likely continue to grow.at a rate better than I can get if I put it into savings accounts. Should I have an unexpected emergency then I'll be able to access approx £28k pa without having to worry about higher rate tax.

On another note, Nationwide have just announced a fairer share payment of £100 along with a 15 month bond up to £10,000 that pays 5% - i'll look into that a bit more as it seems a good rate at the moment.

On the EV front, we've just had our first bill - exactly the same as our old monthly DD before I switched to an EV tariff - with the heating now off it seems we'll be able to build up a good buffer before the winter. Our effective unit charge is 15p per kwh (6.99p overnight, 31p during the day). Happy with that - we're now using the dishwasher and washing machine overnight to take advantage of the rate too.