How close am I to my early retirement?

IamWood

I come here to seek collective wisdom if we can please

I have just been offered a position in London (an hour and 15mins trip from where I live, 2-3 days a week in office) which would double / triple (potentially) my salary (at least £150K). Deep in my heart, I still want to challenge myself before I get too old and of course, increase my financial security before I hit the retirement button. My current job is relaxing with reasonable pay, as you can see from the original post. Should I jump ship and maximize my income for a few years and then hit the button to do something I have planned?

I need your wisdom, please. I have to respond within two days.

Albermarle

IamWood said:

I come here to seek collective wisdom if we can please

I have just been offered a position in London (an hour and 15mins trip from where I live, 2-3 days a week in office) which would double / triple (potentially) my salary (at least £150K). Deep in my heart, I still want to challenge myself before I get too old and of course, increase my financial security before I hit the retirement button. My current job is relaxing with reasonable pay, as you can see from the original post. Should I jump ship and maximize my income for a few years and then hit the button to do something I have planned?

I need your wisdom, please. I have to respond within two days.

My 'wisdom' is that only you can decide on such a big decision.

Normally your gut reaction is the right one ( not 100% always ) . A good test is , if the company in London , phoned you this evening and said the offer is retracted , would you be disappointed , or relieved ? 

barnstar2077

Also, how secure is the current job?

IamWood

barnstar2077 said:

Also, how secure is the current job?

The current job is secure as long as the firm is running I think. However, the technology is getting behind due to business factors out of my control. They also have taken advantage of the COVID and frozen staff pay for 2 years. The new role is challenging itself and the reward is potentially substantial.

michaels

IamWood said:

barnstar2077 said:

Also, how secure is the current job?

The current job is secure as long as the firm is running I think. However, the technology is getting behind due to business factors out of my control. They also have taken advantage of the COVID and frozen staff pay for 2 years. The new role is challenging itself and the reward is potentially substantial.

I wouldn't make that choice but perhaps it would be the wrong one for me.  I would worry about burn out - those long days followed by 'compulsory socialising' that felt like fun when I was younger would feel like a real drain now especially as I would be missing the final few years of my kids at home - for example I am working from home and could take yesterday afternoon off at short notice to watch a school football match that will not happen again compared to working long hours a long commute from home with little flexibility - no thank you.  But obviously each of us has different priorities, I have never either felt I needed to prove myself by my work output nor that my work is of particular value.

mlv-1967

IamWood said:

Age: 48
Annual Gross Salary = 75k
Accidental Landlord = 1,450 monthly (since this year)
Workplace pension pot = 250K + 90K
SIPP = 75K
Spouse SIPP = 30K
ISA = 40K (as an emergency fund, will be moved to Share ISA)
Saving = 30K
Pension contribution since this year: 45% + 5% = 50%
NI qualifying years (self) = 7 years to full pension
No mortage
Two children 18, 16. Both will be going to universities

When can I retire without financial worry?

You can retire as soon as 55.  What is your occupation?

jamesd

Key to this decision is that you want to challenge yourself. An added benefit may be that it's possible you could fund temporary accommodation close to work for a few nights a week and avoid the commuting time.

ex-pat_scot

I've done similar to you.
Frankly (pre Covid) all of my commuting, whether to London or northern cities, was 70-90 minutes each way. 5 days a week.

There are three main courses of action:
1. do nothing. If your current employer is stagnating, then that might not be a comfortable place to be in 2-3 years' time.
2. London. For 3 years. Fill yer boots then downsize back to something similar to current.
3. London until 55-57/ retirement.

Things to be considering:
Current firm. Will you outgrow or be outgrown in your current role? Can you see yourself staying there another 10 years?

Finances. You have good headroom for serious SIPP contributions. London will allow you to max out the £40,000 pa (plus c/f from previous 3 years, potentially) with good marginal relief rate.
What's the differential cost in going to London vs staying in current?
Lifestyle creep. If going to London, try and minimise the spending of your additional income. There's no use taking on additional work and stress if you only fritter it away on pointless spending.

London. It's where the money and opportunities are. Sadly.
Getting a £150,000 gig, even if you only last 2 or 3 years, will reset your base when negotiating future packages. 
In most lines of work, there are far more opportunities there than in the regions.
Travel/ hybrid working patterns are far from clear at the moment. Many firms' plans are very fluid at the moment, and I'm not entirely sure anyone will really be able to set out what it will be like in 1,2,3 years' time. (I'm going to push my luck on the wfh where I am, as I'm 4+hrs from the office and have no desire to go in unless dragged).
For a 75 minute commute, I'd not want to stay in London at all, perhaps excepting the odd event such as Christmas party (and even then, I'd still want my own bed).

Finally - life plan.
Can you exist quite comfortably on your current path? Including funding the children through university and into early adulthood?
Does it get you to the right level of retirement at the right time.
Would London allow you to retire earlier / live more comfortably?
What would you be missing out on, if you went to London? Do you do many of hte family things (school, activities) that would fall on your partner if you went to London?

Retireinten

People on this forum can give you their view on the job offer but it will be tainted by their own plans and personal experience.

My immediate 'heart' reaction to what you describe is 'good god no, I don't want the stress, responsibility or lack of flexibility'.  But then again I don't have a relaxing job on £75k a year, I have a stressful job on £52k and my assumption is that the London role would be so much worse than what I do now because it pays so much more.

My 'head' would then kick in and do the math. I'm 46 and I currently I have bang on 7 years to go to FIRE, earning at the rate I do.  IF I took on that new job, what would my new FIRE date be if I saved the extra? And could I hack the job for that amount of time to achieve an earlier FIRE date? 

The deciding factor for me would be if the shorter FIRE date is worth the sacrifices relating to the new job. My head may well win I suspect if my FIRE date moved to two years, three years at a push. 


Worse case scenario is you move and despise the job. What would you do then? If you can answer this question and are comfortable with the answer then it may be worth going for it.

IamWood

Thanks a lot to everyone for the helpful comments. I would like to update you that I have accepted the offer to see what pans out. I know I'll regret it if I don't at least try.

The next question please how to make hard-earned money be more tax-efficient besides paying 40K in my pension. The company would contribute 10% of my base salary to my pension BTW.