How close am I to my early retirement?

trevjl

I think various providers now offer annuity or drawdown focused lifestyle approaches with different “tactics” to subsequent investments. I’m far from an expert but I’ve seen this as a choice in several of my DC pots. 

The drawdown approach seems to keep a larger chunk of money in equities longer term.

My company DC with Aviva was in LS , after reading various on here I looked into it and found it was extremely defensive to say the least. I found they offered a drawdown focused alternative as you mention. I upped my retirement age a bit and moved it and it has done pretty well since. Certainly worth looking into IMHO.

Scrudgy

trevjl said:

My company DC with Aviva was in LS , after reading various on here I looked into it and found it was extremely defensive to say the least. I found they offered a drawdown focused alternative as you mention. I upped my retirement age a bit and moved it and it has done pretty well since. Certainly worth looking into IMHO.

My company as well. As soon as I joined the scheme I immediately opted for the self select strategy where I decide what funds my money goes into. According to our pensions manager I am part of only 2% of the staff who go this route.

The other 98% are in the Lifestyle option which is pretty cautious, even for people in their early thirties, as some of their pot goes to cash at this point, maybe only 5%, but it is still easily a net loss and is increased every 5 years by another 5%.

lisyloo

My IFA said the lifestyle option is a blunt instrument for the 98% who won’t engage.

Thrugelmir

MallyGirl said:

Watch out for ones with 'lifestyle' in the name as that might mean it de-risks as you approach retirement age and that might not be what you want.

The longer bull markets run the more complacent investors become. 

IamWood

Submitted a remortgage application today for the property I currently live on.

Borrowed 250K, 5-year fixed with interest rate 1.54%. The property I may purchase is at about 205K. The rest will be invested.

It's very bad timing though as the bank just increased the 5-year fixed interest rate yesterday (from 1.34%, then 1.44%, then 1.54% in a few weeks). Well, the appointment was booked before Christmas, I ended up paying a couple thousand more than I expected during 5 years.

Well, what an opportunity cost

IamWood

After some discussions in my household, I was suggested to rent for a few months (or a year or so) to get a feel for where I would like to live during my employment in London before actually committing to buying a flat.

The flat I am looking at is in Reading. Reading is reasonably convenient but doesn't help at all with travel costs (the annual ticket is around 5K, compared to 6K from where I live at the moment). I wonder if this is a feasible choice apart from shortening my commute time.

In case I pull off the purchase:

1) Should I still go-ahead to take the remortgage fund?

2) Any advice for investing the 250K before buying a flat if that's a route I take in the end.

Thanks.

MallyGirl

If you are just looking at cutting down the commute (time and cost) maybe consider stops a bit closer in to London that are on the new Elizabeth Line - Slough, Iver, Langley? It will probably be cheaper than Reading which has extortionate fares given the length of the train journey

michaels

MallyGirl said:

If you are just looking at cutting down the commute (time and cost) maybe consider stops a bit closer in to London that are on the new Elizabeth Line - Slough, Iver, Langley? It will probably be cheaper than Reading which has extortionate fares given the length of the train journey

You clearly have more faith in that line opening anytime soon than I do....

gtat

michaels said:

MallyGirl said:

If you are just looking at cutting down the commute (time and cost) maybe consider stops a bit closer in to London that are on the new Elizabeth Line - Slough, Iver, Langley? It will probably be cheaper than Reading which has extortionate fares given the length of the train journey

You clearly have more faith in that line opening anytime soon than I do....

The Western part of the 'Elizabeth Line' route in to Paddington is already operating (as 'TFL Rail').

london21

Your current pension pot is quite good.

Great bold move to take on the new role, all the best.

The main thing I got from your post is that you take action quickly.

When it comes to investing do take your time to do research and due diligence before you invest your 250K and diversify if investing in funds, shares etc  .