Getting FIREd up 😀

South_coast

*Actually, I think that would probably be fairly easy to work out, so I might take a look at that over the weekend 🤔

Well, all I have achieved with that is to make myself feel extraordinarily thick 🙄 I am starting to feel like calculating what I need for retirement is a maths problem too far for me (I started off by spotting that I am another £25k adrift on my figures 🤦‍♀️ - or possibly not, I am really struggling to work it out 🤷‍♀️) I have got as far as working out that for every £10k I withdraw from a pension, I will receive £8.5k of it:

£2.5k will be tax free

£7.5k will be taxed

£7.5k after 20% tax becomes £6k

£6k + £2.5k will be received

However, what I just cannot work out is where the personal allowance comes in to the figures 🤷‍♀️🤷‍♀️🤷‍♀️ It was easy for the pre-pension years (income all comes from ISA = no personal allowance to consider) and the state pension years (state pension = personal allowance = all other pension income is taxable), but I just cannot fathom how much I need to withdraw in the initial pension years in order to receive the income I want. If anyone knows of a simple calculation, or can see a way in which I am being a complete moron in my workings, then please don't stand on ceremony and shout up!!!

Failing that, I think the old fallback of "Save as much as possible/Spend as little as possible/Hope for the best" will work for the time being 😀

South_coast

Oh, and the car insurance cashback has arrived, so that's one bit of good news 😅!

edinburgher

As I understood it:

Pension £20,000

TFLS £5,000

Pension - TFLS = £15,000

PA £12,570

£15,000 - £12,570 = taxed on £2,430.

Tax = not much

This is why you can take £16,667 ish out without paying tax

South_coast

Thanks Ed, that's my understanding of it too. Maybe I was just trying to work it out the wrong way round 🤔? I'll give the spreadsheet another half an hour (I might even treat it to a new tab 🤣) to see if I can crack it 🤞

South_coast

OK, so I think I have nailed it 🥳! If I don't accrue anything more from this day onwards then I am on track to retire at age 69, so the challenge now is to bring that closer to my preferred age of 52. To achieve that, I need a further £431,834.77 (to be precise 🤣!) Initial thoughts:

1. See what impact the new pension contributions have on my net income, and decide whether I can afford a bit more
2. Focus on trying to repay the pots and car finance sooner than May 2027, so that the money I save each month is going towards The Future, rather than things I just haven't put aside for
3. Concentrate on earning interest rather than paying it (try to save enough to buy my next car in cash)

Phew, think that's enough for one Sunday 😅! Now off to BF's to decompress (and hope he doesn't ask me anything challenging)!

Jessy103

2nd job as Midsomer Murders tour guide?! 😝🤣

edinburgher

52? Impressive target 👌🏻

South_coast

https://forums.moneysavingexpert.com/discussion/comment/81985905#Comment_81985905

!!! Now if I was more local....🤔

South_coast

https://forums.moneysavingexpert.com/discussion/comment/81985973#Comment_81985973

Probably not very achievable, but it's what I'm aiming for 🤣!

QueenJess

Mine is similar… at least once I get to 50 I don't want to HAVE to work as I can live a minimum existence on what I have. In reality I will probably still work to pay for the nice to haves (e.g. holidays). But it'll be lovely for my mental health to know I am only at work to pay for holidays :)

No idea if that is achievable, but I can dream!