What are the flaws in my retirement income plan?

RecliningInPeace

Notepad_Phil said:

What happens if you don't get the returns that you are hoping for?

Phil, thanks. Some type of scenario analysis and stress testing is a good idea.
To answer your question, in general terms there is a fair bit of fat in my planned income (on condition the mortgage is nil), so there is a natural margin of safety.
In terms of a big market drop, it depends when it happens and how bad it is. In your doomsday scenario, if it happened before retirement I would likely continue working for a while. If I'm already in retirement I could cut back on outgoings, sell the second property or work again in worst case.
You did encourage me to think about about adding another layer of fat by waiting for the total pot across assets to be at some level beyond the 'target' £1.5m, so thank you for the challenge.

Thrugelmir

RecliningInPeace said:

* Example long-run returns I looked at: FTSE 30 years at 9.9% to 2018 (an article which also points out volatility), global equities 5.2% post-inflation over 120 years, S&P returned annualised 9.8% for the 90 years to 2017 and 7.9% from 1957 to 2018, DJIA at 5.4% from 1896 to 2018. (I used hyperlinks to evidence the references, but when I tried to post, was told that I need be around for longer to post links.)

 I assume that you are quoting from the Credit Suisse Annual Year Book. Worth pointing out that you aren't investing with a time horizon of 30, 90 or 120+ years.  Just 7 years in fact.  Have you bothered to study market volatility in undertaking your quest?  
 

NedS

RecliningInPeace said:

@NedS
Thank you; I should be only three or four years short by then. I suppose I would not have to make a decision until just before I qualify for the state pension at 67.

Not sure when the cutoff is (and it could change by then anyway), but that's something you can look at post 58 once you retire, as you can't buy future years, only past (and present) years.