FIREDreamer’s Retirement Journey

FIREDreamer

I handed in my notice at the start of the year and will retirecat 60 at the end of June 2024. My thread won’t be as interesting as @Sea_Shell ‘s journey but putting my placeholder here which I intend to update on 1 July 2024 and every six months thereafter to see how my journey pans out.

This is for a family as my wife doesn’t work and the £2,880 contribution is made to her SIPP which I am ignoring here.

01/01/2024
Crystallised Drawdown SIPP £300,000
Uncrystallised SIPP £39,000 (increases by £3,000 per month until I retire in June)
DB 1 in Payment £8,500 pa (Capped RPI increases in July)
DB 2 in Payment £4,300 pa (Capped CPI increases in July)
Annuity in Payment £24,600 pa. (Uncapped RPI increases in November)

Cash Pot £170,000
Shares ISA £605,000

Unless higher rate band increases, my state pension will take me into higher rate when I reach SPA in 2031 so will stop any drawdown then if I don’t need it. We both have the full state pension already - fully checked, e.g. mine …

SouthCoastBoy

That's an impressive pension income, think I still have a little way to go to match that. Back to the grindstone.

FIREDreamer

SouthCoastBoy said:

That's an impressive pension income, think I still have a little way to go to match that. Back to the grindstone.

Salary sacrifice down to minimum wage for 13 years helped! Then a big boost to annuity rates when I did not have any bond investments to take a similar hit - so I took advantage of the annuity rates thanks to the ongoing aftermath of Liz Truss!

jimi_man

So £37k in income (with RPI) until SPA then another £21k or so. £350k in a SIPP and a further £770k in savings. Only seven years to SPA. 

You don’t actually say what your Number is (which BTW is the most useful thread on here) - how much you’re going to spend or how much you need so these figures need some context, but with £37k for seven years and then £58k after that forever (index linked) and £1.1 million as a backup in savings, it sounds like you’ll be ok! 

SouthCoastBoy

FIREDreamer said:

SouthCoastBoy said:

That's an impressive pension income, think I still have a little way to go to match that. Back to the grindstone.

Salary sacrifice down to minimum wage for 13 years helped! Then a big boost to annuity rates when I did not have any bond investments to take a similar hit - so I took advantage of the annuity rates thanks to the ongoing aftermath of Liz Truss!

The discipline has paid off. Congrats.

michaels

Suggestion you draw down from your sipp up to the basic rate tax threshold until SPA stashing any spare cash into your isa to minimise any higher rate tax payable on drawdown post state pension receipt (unless the sipp is entirely an inheritance tax vehicle)

FIREDreamer

michaels said:

Suggestion you draw down from your sipp up to the basic rate tax threshold until SPA stashing any spare cash into your isa to minimise any higher rate tax payable on drawdown post state pension receipt (unless the sipp is entirely an inheritance tax vehicle)

That is my thinking too. Maybe cash ISA now as have enough equities now. Or perhaps bonds in my shares ISA?

FIREDreamer

jimi_man said:

So £37k in income (with RPI) until SPA then another £21k or so. £350k in a SIPP and a further £770k in savings. Only seven years to SPA. 

You don’t actually say what your Number is (which BTW is the most useful thread on here) - how much you’re going to spend or how much you need so these figures need some context, but with £37k for seven years and then £58k after that forever (index linked) and £1.1 million as a backup in savings, it sounds like you’ll be ok! 

Strangely enough, without the annuity guaranteed income, I probably would have “one more yeared” again.

jimi_man

FIREDreamer said:

jimi_man said:

So £37k in income (with RPI) until SPA then another £21k or so. £350k in a SIPP and a further £770k in savings. Only seven years to SPA. 

You don’t actually say what your Number is (which BTW is the most useful thread on here) - how much you’re going to spend or how much you need so these figures need some context, but with £37k for seven years and then £58k after that forever (index linked) and £1.1 million as a backup in savings, it sounds like you’ll be ok! 

Strangely enough, without the annuity guaranteed income, I probably would have “one more yeared” again.

So what is your Number? How much do you think you’ll need?

Bostonerimus1

That 24k RPI annuity must have cost a pretty penny, even with today's payout rates.

FIREDreamer

Bostonerimus1 said:

That 24k RPI annuity must have cost a pretty penny, even with today's payout rates.

Approx £650k but worth it for peace of mind.

EDIT: and less investment management for my wife should I go first.