Redundancy and then Early Retirement?

CloesUnc

Hello.

Ive been lurking on here for a good long while to get hints and tips about my future. and have now plucked up courage to post haha.

I am 53 years old and I may be leaving work soon. my situation is that I have a defined benefit pension with normal retirement age of 60, worth about  £17,500 before tax, but will increase with CPI from now. Also another DB that I plan to take from 55 probably worth £5300 per year, again before tax. I have a SIPP that I plan to draw from at about £16,000 per year or so from age 55 to save tax. I will also have about £100,000 in various investments. My partner is five years younger than me and works in a good job (£40k per year) and has plenty of savings and investments herself. We have no kids and no mortgage, and lead a modest life, cheap cars, cheap holidays , shop in Lidl, probably £1000 ourlay of necessary costs per month.

Sorry I don't want to go into much more detail than this but what are peoples' gut feelings about these figures. I would very much like to walk away from this job now as I cant cope with the stress of it anymore.

CloesUnc

Sorry i also meant to say that there may be a small chance of redundancy, but I don't know.

squirrelpie

Get some paper/spreadsheet and draw up your anticipated expenditure for each month until you are 60. Then decide how you'll fund that expenditure and check that you can afford it. That's assuming you think you'll be rolling in clover once both pensions are in payment.

Marcon

CloesUnc said:

Hello.

Ive been lurking on here for a good long while to get hints and tips about my future. and have now plucked up courage to post haha.

I am 53 years old and I may be leaving work soon. my situation is that I have a defined benefit pension with normal retirement age of 60, worth about  £17,500 before tax, but will increase with CPI from now. Also another DB that I plan to take from 55 probably worth £5300 per year, again before tax. I have a SIPP that I plan to draw from at about £16,000 per year or so from age 55 to save tax. I will also have about £100,000 in various investments. My partner is five years younger than me and works in a good job (£40k per year) and has plenty of savings and investments herself. We have no kids and no mortgage, and lead a modest life, cheap cars, cheap holidays , shop in Lidl, probably £1000 ourlay of necessary costs per month.

Sorry I don't want to go into much more detail than this but what are peoples' gut feelings about these figures. I would very much like to walk away from this job now as I cant cope with the stress of it anymore.

If you can't cope with the stress, and have what seems to be a decent amount of cash saved for retirement, then why would you stay?

You say 'there is a chance of redundancy' but if the job is so awful, is it worth hanging on to see if you can get a payout - and possibly doing your health serious damage in the meantime?

Brenster

CloesUnc said:

Sorry i also meant to say that there may be a small chance of redundancy, but I don't know.

If you are thinking of leaving anyway, and are not concerned about how asking may affect your job / future, why dont you meet with your boss / HR to see if voluntary redundancy is an option ?  Obviously dont let on you are thinking of leaving anyway....

Albermarle

 I have a SIPP that I plan to draw from at about £16,000 per year or so from age 55 to save tax.

My gut feeling is that if the SIPP is large enough to sustain this level of withdrawal for the rest of your life then you have no worries . If it is only big enough to last a few years at most, then you need to get the calculator out in more detail.

If it is big enough to at least  get you to state pension age, even if the £16K has to be reduced , then you should still be fine though. Presuming you will get a full state pension?

CloesUnc

Albermarle said:

 I have a SIPP that I plan to draw from at about £16,000 per year or so from age 55 to save tax.

My gut feeling is that if the SIPP is large enough to sustain this level of withdrawal for the rest of your life then you have no worries . If it is only big enough to last a few years at most, then you need to get the calculator out in more detail.

If it is big enough to at least  get you to state pension age, even if the £16K has to be reduced , then you should still be fine though. Presuming you will get a full state pension?

Hi Abermarle. I would expect one of my defined benefit pensions (£17500) to take over from the SIPP at age 60. So this would be equivalent to the "everlasting" SIPP I guess.

Notepad_Phil

It sounds as though you probably have enough, but...

What is your state pension situation? If you've not checked then do it now on https://www.gov.uk/check-state-pension and read past the headline figure to check what you'll get if you stop work now.

What will you do with yourself whilst your partner is still working? You say you only spend circa £1k a month for necessary costs, but is that going to be enough to keep yourself occupied and happy?

What do you consider as a necessary cost? Personally I'd consider anything that we will need to buy at some point in the next umpteen years as a necessary cost, so we put money away every month to cover those and include it in our retirement budget (i.e. money goes away each month to cover the replacement cars, house refurbishments, new carpets, new tvs, etc, etc that we know will be needed at some point in time).

CloesUnc

Notepad_Phil said:

It sounds as though you probably have enough, but...

What is your state pension situation? If you've not checked then do it now on www.gov.uk/check-state-pension and read past the headline figure to check what you'll get if you stop work now.

What will you do with yourself whilst your partner is still working? You say you only spend circa £1k a month for necessary costs, but is that going to be enough to keep yourself occupied and happy?

What do you consider as a necessary cost? Personally I'd consider anything that we will need to buy at some point in the next umpteen years as a necessary cost, so we put money away every month to cover those and include it in our retirement budget (i.e. money goes away each month to cover the replacement cars, house refurbishments, new carpets, new tvs, etc, etc that we know will be needed at some point in time).

Hi Notepad. Thanks for your reply. My State pension forecast is £135.73 from age 67 if I were to stop work now. I have number of hobbies that needn't cost a lot of money. I have also budgeted for "pocket" money and a shortterm slush fund. By necessary costs I mean monthly bills etc., which my partner and I split 50-50.  Also I reckon I can put £400 to £500 aside for longer-term spending on cars etc. I do already have an emergency fund of £10k at the moment. I have been planning for early retirement for a good number of years, but never really run my plan by anyone.

MallyGirl

it might be worth buying a few extra years via voluntary NI. The payback only takes 3 or 4 years and then you are better off.

Albermarle

Buying extra NI years to increase your state pension up to maximum, is very good value for money and should be a priority.
I do not know the exact figures but no doubt somebody will be along shortly who does .