Retirement - will I manage

squirrelpie

Liz08000 said:

So my question is, if I retire fully now, do you think I could manage if I carefully budget between now and getting my state pension, or am I being daft.

One way to find out is to try it. Put your earnings in a savings account (other than anything you spend directly because of your employment such as bus fares or petrol) and try to live off your remaining income. If you can do it happily, then congratulations, you can stop working. If you're struggling, then you've still got the earnings to make up the difference, and you know you need to keep on for a while. Either in your current job or in a new one as others have suggested.

sgx2000

Due to the UK higher state pension age (my age will be 67), I have 6 more years to go before I get it 

Equality with men, eh!! lol

molerat

xylophone said:

Have you obtained a state pension forecast?

https://www.gov.uk/check-state-pension

I echo this.  With a long contracted out history at your age there is a fair chance you have not reached the full amount so will likely need further contributions from some source.

MoneyWorry

I am virtually in the same position as you, being nearly 62 with a state pension age of 66 and 8 months.  I leave permanent, full-time work a week on Friday.  I will have £398 monthly disposable income, after bills BUT after I have allowed the following beforehand.

Food £130, Entertaining £32.50, House Maint & Emergency £55, Holiday £55, Cat Health £13, Clothes £25, Dental £2.50...like you I have a plan in place for teeth basics.  So, like for like, I have £710 compared to your £600 so I would say you are in the right ball park.

You haven't mentioned current savings.  Except for food, all my categories above have a reasonable credit balance. I wanted that in place to start me off in case I get hit with some sort of unexpected expense immediately after finishing.

Hope this helps.

LHW99

The suggestion of trying to live only on the pension for 6months to a year is a good way to evaluate how things would go, while still having the work income available if it turns out there is a shortfall.

SouthCoastBoy

LHW99 said:

The suggestion of trying to live only on the pension for 6months to a year is a good way to evaluate how things would go, while still having the work income available if it turns out there is a shortfall.

Yes, I'm doing that at the moment, started in Dec 2021, and putting £2600 per month into a new joint account and all spending is coming from that, other than some DDs which I add to the pot so really we are spending £2900 per month. I have been pleasantly surprised by the results, currently have a surplus of approx £6k and that is after spending £6k on flights to Oz as daughter is currently studying out there she is back to uk next summer so not an ongoing cost. My initial plans were we need £3k per mth but now I think that could be lower.

I have found it a useful exercise to give me a little more confidence in retiring, not there yet though!

elsien

squirrelpie said:

xylophone said:

Would pet insurance be worth consideration?

Almost certainly not, for anybody! Put the same amount of money aside in a savings account and use it if required.

A bit of a sweeping statement. It cost me nearly a grand for my dog to have an overnight stay in and out of hours hospital with a drip, when he ate something he shouldn’t have and that was without any further treatment other than blood tests. That was more than my premiums for the year.

[Deleted User]

For comparison I am two years away from state pension age. I consider myself to be semi-retired. I took the final part of my DB pension 5 years ago after a phased retirement. Since that time, I have undertaken several part-time temporary contracts to supplement income, savings, cosmetic dentistry and some house improvements. I am currently working just over 2 days a week and will probably do so until next year. I will definitely finish completely by August 2023. After tax and NI my net pay at the moment is about £1000 a month. For many of my previous part-time contracts it has been a lot less. For the next few months this money will go into savings.

Without this additional income my pension income is about £1530 a month. I allocate it as follows,

£650 for all household bills and petrol including food and household goods.
£250 to regular monthly savers.
£200 to an account that covers annual bills such as house and car insurances, MOT and Car Service plus annual dentist check and two dental hygiene visits per year. This usually runs at an annual surplus
£150 a month to a second back up current account (with a different bank) that I also use for spending on clothes, Christmas and Birthday presents throughout the year. This also usually runs at a surplus.
£100 a month to a medium risk S&S ISA
£180 a month for daily expenses such as haircuts, meals out, sundries etc...

I have no debt and own a mortgage free house.

During the past 5 years the part time earnings (which have varied from £400 to £1200 a month) have been used for some house improvements and holidays.

I do not have extensive savings but enough to make me feel safe £10000 plus in an emergency fund and a similar amount in premium bonds. I also have smaller amounts in a S&S ISA and a 3-year bond

The regular savers, which tend to have a one-year lifespan, I have also used for trips and other one offs.

I am confident I can cope on just my pension income should the part-time work end. I only work because I enjoy what I do. Knowing that i can stop whenever I want too and be able to manage is also liberating! I will have to do so from September 2023 to July 2024 when my state pension kicks in. I have 2 more years NI contributions to make to ensure I receive almost a full new state pension less a few pence a week.

My current estimated income from July 2024 at age 66 is for a monthly net income (At today's values) of about £2200 a month after tax.

My house is well maintained, and I have recently had a new kitchen installed as well as a new garage roof and garden fencing.

I would like to upgrade my car once more within the next year or so (newish second hand). This will be a cash purchase.

So, in answer to your question, I think retirement is doable for you providing you have some savings as a back-up.

Hope this helps.

Liz08000

Hi Baron Dale. Thanks for your detailed response and it’s pretty much identical to mine. So it’s reassuring I can do it. I own my home and car and I can access pt jobs here and there.I always have to think about being taken out of action eg even having a simple fracture and not being able to work for a wee spell. I would need to manage then solely on my NHS pension in that time where as now on this current job I would get 6 months full pay then 6 months half pay. It’s simply the security in emergencies. When my state pension kicks in, ages away yet, ill manage ok as will have £2k a month. Again huge thanks.

[Deleted User]

Liz08000, do you have some savings as back up too?