How much to live on

henry24

Thanks for your replies I'd never given things much thought until I started reading this thread but I'll try answering some of your points.
I'm not a knowledgeable investor I started a pension in the late 70s putting in £270 per year this is now worth around £48000 and according to the statement with the GAR would pay me £4500 per year from age 60 which was last month for 5 years or life. My thinking is to start claiming this without taking the lump sum as I'll make more money by not doing so.
I then wanted to increase my contributions but would have lost the GAR so started another pension which is the one with £110000 in and the £6200 is at 65 so this should increase over the next 5 years. This one I'm thinking about taking 25 % at 65
I can't increase the amount I pay in or transfer any money into it without losing the GAR and as I'm single with no family I'm not to bothered about what happens to it when I die.
I have been working all my life and even now at approaching midnight I'm working in a signal box thinking it's time to let someone else have a go 

Kim1965

Considering recent bad news, inflation. Above inflation hikes on utility bills and car fuel, the war in Ukraine, increasing food cost, market volitilty etc. How is this affecting retirement plans??
 I think doing "one more year"  or indeed several more years may unfortunatley be prudent. 

hugheskevi

Kim1965 said:

Considering recent bad news, inflation. Above inflation hikes on utility bills and car fuel, the war in Ukraine, increasing food cost, market volitilty etc. How is this affecting retirement plans??
 I think doing "one more year"  or indeed several more years may unfortunatley be prudent. 

I'm trying to keep as many options open as possible, and remain flexible to respond to as much as possible. This includes:

• Working longer than planned, although that is more related to COVID and being happy to carry on working over the summer, whereas previously we had planned to leave in December to go travelling. Once the December deadline was missed we then wanted to work until at least May to take advantage of a new set of income tax allowances and get another National Insurance qualifying year and thought we may as well work until September before we leave as UK summer is a nice time.
  
• Investments have been held defensively for several years now, so investment volatility isn't much of a concern, but high inflation is a concern
  
• I'd fixed utilities with a large provider until we leave in September so utilities are not a concern. Hoping that by the time we get back from traveling things will be getting back to normal.
  
• Taking unpaid leave for 2 years (longest time possible) rather than resigning from my job so there is something to go back to if necessary/desired
  
• Renting my house out rather than selling it while going traveling from September
  
• Derisking as much as possible by paying down all debt, even though it was 0%. If we weren't going traveling I would have invested in a big round of refurbishments, updates and replacements (including car) to bring forward future expenditure
  
• Planning to possibly take a no-fees offset mortgage in the future which would be left fully offset so as to give access to a big pool of funds in case of need. That could also avoid the need to take DB pension early, then repaying the mortgage from the higher pension income.
  
• Considering ways to convert DC pension to DB pension via transfer-in
  

BooJewels

Morning.  I've been following this thread for some time, but I think this is my first post.

Circumstances have forced me into looking at my long term position and I made a [vague] plan and crunched a lot of numbers and I thought that I'd be okay, as long as I was sensible.  Then the fuel crisis happened and I wondered how much it would ruin my numbers - as whilst I had some wriggle room - perhaps not enough.  Then inflation hit 5.5% and I revisited my numbers and now it doesn't work quite so well.  If it rises to 7.5% in the next couple of months, as I've heard commentators predict, then I'm in trouble.  If inflation stayed anywhere near 7.5%, then that halves the buying power of your money in about 8 or 9 years.  

Kim1965

I dont have a mortgage or any debts so feel in a good place. I also have some db pension payable in a few years at 60 circa 8 k pa. However inflation is a major concern, as is reliance on dc pensions. High inflation and poor market returns scupper all my plans 

BooJewels

I'm the same @Kim1965 - mortgage paid off about 4 years ago and had one consolidation loan heading towards completion, so decided to pay that off early. It only saved me about 30 quid, but psychologically it was important - just seeing much lower monthly outgoings was truly worth it.  Having absolutely no debt after almost 40 years of being much in debt at times, was a real milestone.

So my outgoings now are a fraction of what they used to be and in line with the thread title, I reckon that I can currently live on less than £900 per month.  That's without being especially careful or skimping - many months it's less than that.  But I need to learn to drive, so those costs will be added in future. 

Kim1965

Likewise, its taken me 40 years to be free of any sort of debt. 2 yrs ago my monthly fixed payments topped £2200 ( excluding saving /pension ). Currently £900 per month, in a few years at 60 they will drop to £500  per month at the same time as i get my 8k pa db pension. I would love to retire at this point. However i think with recent changes in economic outlook i may not have enough  dc pot. Probably best to stay flexible/be prepared to work part time. 

runningromani

Hi @drummersdale hope you are doing ok. I said I’d let you know when my CS pension forecast came through, it did last week and was almost identical to the figures on the website calculator. I signed the papers and got them off before I could change my mind. All the bad news about price increases was messing with my head a bit. So after chatting through again with my wife (who is also retiring) we agreed the worst thing that could happen is we have to work sometimes on short term contracts or part time for a while. I should cross the finish line on 14 April now confirmed 🙂

drummersdale

runningromani said:

Hi @drummersdale hope you are doing ok. I said I’d let you know when my CS pension forecast came through, it did last week and was almost identical to the figures on the website calculator. I signed the papers and got them off before I could change my mind. All the bad news about price increases was messing with my head a bit. So after chatting through again with my wife (who is also retiring) we agreed the worst thing that could happen is we have to work sometimes on short term contracts or part time for a while. I should cross the finish line on 14 April now confirmed 🙂

Hi @runningromani thanks for the update - good to hear that the forecast was what you expected.  I got agreement to go down to 2.5 days from August so completed the partial retirement form and sent it off so it’s now in the process.  I can fully understand and share your reticence about price rises, energy increases and all the other stuff that is going on in the world.  Unlike you I will be keeping one foot in the tent so to speak until my wife is able/wanting to retire but as she’s only 54 it will be a few years yet.  If I have done my calculations correctly (I used the Salary Calculator website to determine how much tax I would be paying, value of my pension etc - using the “two jobs” option) then I should be broadly getting per month what I’m getting now - plus there should be the occasional pay rise and pension increase which should also help.  Hope it goes well for you - it’s only a month away! 👍

Amateurretiree

We are still able to live a reasonable life ( no holidays) on my DB NHS pension even with increased fuel prices, and lucky enough to use DHs DC pension for holidays home improvements etc.

So inflation will only hopefully affect our non essential spends.
We are planning to have our last long haul holidays this year, so then it won’t matter so much.

Ive been retired 5 yrs, DH 3, our time is taken up with looking after our grandaughter and picking her up from nursery, still living our best lives thankfully.