How much to live on

moving_forward

[Deleted User] said:

moving_forward said:

That's a fantastic amount to be able to live on. We (2 adults) use approx £22k a year if you exclude debt and mortgage. Pension contributions come off pre take home pay. We are working reducing over spending, some spending like transport costs won't be there when we retire but higher energy prices will probally eat those up.
Of course we will use some of the debt and mortgage money to fund capital expenditure when they are paid off.
We hope to have enough to either retire one of us or both part time in about the same time frame as you.

Are you able to give an approximate breakdown of how you spend that 22000? Might be useful for others on a similar amount.

Housing exc. Mortgage	£  3,504.00
Travel	£  2,652.00
Entertainment	£     384.00
Personal	£  3,132.00
Groceries, Household etc	£  7,800.00
Sinking funds	£  4,680.00

The housing includes Utility bills insurance but not mortgage as I mentioned we pay that also.
Travel includes fuel, public transport, Breakdown cover and insurance
Entertainment is subs e.g. prime
Personal includes our "pocket money" haircuts healthcare, prescriptions and other ad hock meds
Groceries is everything you would buy from a supermarket or the like including pet food, toilet paper toothpaste and cleaning items.
Sinking funds are what we put away for the annual and ad hock things such as car maintenance, dentist, optician, clothing, vets and pet sundries, extra money for holiday spending (we don't go away due to pets).gifts, etc etc.

We are paying off debt so when that's paid we will include savings for capital expenditure such as replacement car, home improvements and so on.

MovingForwards

[Deleted User] said:

MovingForwards said:

My bills, less work / savings / pensions / mortgage:

£50.00 gas and electric
£135.00 CT and water
£200.00 food
£10.14 phone
£50.00 car insurance / home insurance
£50.00 petrol
£2.00 bank fee
Total £497.14

Very impressive. What about money for leisure, hobbies, holidays etc... Just being curious. I have posted mine yesterday. Thanks.

Obviously I'm still working FT (£22k PY) at the moment and spending more on petrol than if I was retired. Plus overpaying the mortgage, overpaying the used car finance, saving, paying into work pension and SIPP etc. 

I've vast supplies of paint and enough canvases to last a while. Gardening is save seeds and grow again the following year, I've also got a very cheap supplier.
Leisure tends to be day trips and photography (have all my gear), with own food taken. Occasionally we have a coffee while out. I don't drink, smoke, go the cinema etc.
Holidays are not really a 'thing', had a few days away last year to attend the funeral.

£100k savings would be enough to cover holidays (there's a few cruises we'd like to do), replacing my car a couple of times, property repairs etc.

When reaching SPA, there's a surplus from SP and that will cover whatever direction I go in.

Don't forget I'm disabled and have a lifestyle to suit what I can do.

[Deleted User]

Many thanks for your response MovingForwards. 
I must apologise because I had not realised you had a disability. You seem to get so much done all of the time.
Your resolve to make a success of your finances is an absolute inspiration to others.
I take it that the pension you speak about will take you from 58 to state pension age and even beyond. 
Thanks again for your posts.

[Deleted User]

moving_forward said:

[Deleted User] said:

moving_forward said:

That's a fantastic amount to be able to live on. We (2 adults) use approx £22k a year if you exclude debt and mortgage. Pension contributions come off pre take home pay. We are working reducing over spending, some spending like transport costs won't be there when we retire but higher energy prices will probally eat those up.
Of course we will use some of the debt and mortgage money to fund capital expenditure when they are paid off.
We hope to have enough to either retire one of us or both part time in about the same time frame as you.

Are you able to give an approximate breakdown of how you spend that 22000? Might be useful for others on a similar amount.

Housing exc. Mortgage	£  3,504.00
Travel	£  2,652.00
Entertainment	£     384.00
Personal	£  3,132.00
Groceries, Household etc	£  7,800.00
Sinking funds	£  4,680.00

The housing includes Utility bills insurance but not mortgage as I mentioned we pay that also.
Travel includes fuel, public transport, Breakdown cover and insurance
Entertainment is subs e.g. prime
Personal includes our "pocket money" haircuts healthcare, prescriptions and other ad hock meds
Groceries is everything you would buy from a supermarket or the like including pet food, toilet paper toothpaste and cleaning items.
Sinking funds are what we put away for the annual and ad hock things such as car maintenance, dentist, optician, clothing, vets and pet sundries, extra money for holiday spending (we don't go away due to pets).gifts, etc etc.

We are paying off debt so when that's paid we will include savings for capital expenditure such as replacement car, home improvements and so on.

Many thanks moving-forward for your detailed and informative post. Looking at your figures I think there is scope for you to retire with enough money. What ages are you considering retiring? I take it your pension income will be at the £22000 level. Does that include the state pensions?

[Deleted User]

luvchocolate many thanks for your response.

MovingForwards

@[Deleted User] there's no need for apologies! I always try to let people get to know me rather my disabilities.  It's a comfort knowing I don't need loads of money when retired.

The pensions I'm building up are for ER beyond.

I'm building up savings to run alongside that for upgrades, replacing things, maintenance, replacement cars etc.

Plus I have savings I'm building up to cover the period between now and when I retire.

My dreams and plans keep me working each day as I slowly edge towards them.

moving_forward

We should have plenty of time to retire with that level of income including state pensions but I want to ensure we both have enough for a single lifestyle should the worse happen. As for age it will depend on size of pot and health. Hoping for 60 to 65 but may take earlier if circumstances change.
I have a spreadsheet showing possible pot growth based on my funds average over 10years with 2.5 increase for inflation for withdrawals based on a single income of 16k in today's money. It's very crude but I am updating it monthly using actual figures and currently could be ok to go about 60 if I keep to planned increases.

jennystarpepper

MovingForwards said:

@[Deleted User] there's no need for apologies! I always try to let people get to know me rather my disabilities.  It's a comfort knowing I don't need loads of money when retired.

The pensions I'm building up are for ER beyond.

I'm building up savings to run alongside that for upgrades, replacing things, maintenance, replacement cars etc.

Plus I have savings I'm building up to cover the period between now and when I retire.

My dreams and plans keep me working each day as I slowly edge towards them.

Hope you are putting away a few pennies away for the odd ice cream. 🤣🤣🤣 I'm sure you are.  

MovingForwards

jennystarpepper said:

MovingForwards said:

@[Deleted User] there's no need for apologies! I always try to let people get to know me rather my disabilities.  It's a comfort knowing I don't need loads of money when retired.

The pensions I'm building up are for ER beyond.

I'm building up savings to run alongside that for upgrades, replacing things, maintenance, replacement cars etc.

Plus I have savings I'm building up to cover the period between now and when I retire.

My dreams and plans keep me working each day as I slowly edge towards them.

Hope you are putting away a few pennies away for the odd ice cream. 🤣🤣🤣 I'm sure you are.  

It's food and comes out my food budget 😋

drummersdale

I am now in what I hope is my partial retirement year - I am looking to go part time from around August 22 as my last salary increase was 1st August 2021 so I think I need to work 12 months from that date to get my best Final Salary figure. 

I will have worked approximately 40 and 10 months in the Civil Service by then so am currently trying to get my head around what figure I might get (I will be aged 59 and 6 months by then) and how best to avoid abatement.  I was looking to work 2.5-3 days (as you need to reduce your salary by at least 20% - so that would be 40-50%) so my rough numbers are based on salary of £52,300 divided by 80 / 38 yrs 211 days (so say 38.5) gives £25,169 minus say 3% for finishing before 60 gives £24,414 plus whatever the Alpha element might be for the other 2 years.  Let's say it would be about £25,000 combined.  

So if I dropped down to 2.5 days a week is it simply £52300 divided by 2 = £26150 salary element plus £25,000 pension gives £51,150 so I would avoid abatement - is that how it works?

In terms of how much to live on my wife is 5 years younger so I will be looking to work a few more years before I retire fully so our hope is to use part of my lump sum to pay off large things like the remainder of the mortgage, etc and then save some until my wife retires when we can bank her lump sum - her pension will be smaller than mine but combined I reckon they should be in the region of c£35-40k which should be more than enough to pay our monthly outgoings, car, council tax, water, insurance etc and have a nice holiday each year.

Lots of assumptions in the above of course around our health etc but you can only work in the here and now I suppose.