Are we nearly there yet? Option for VR

anonanon321

It's been about 5 years now since husband and I got really interested in FIRE and it feels like we've made good progress in the last few years.  Rough plan is to retire in 2 years time when we will be 53/55.  We would be happy with a joint income of £40K per year.

At the moment we have joint DC pots of £550K and cash / S&S ISAs of £200K.
DB pensions of £20K p.a. from 65 so once SPs kick in (and we will have full years by then) we feel like age 67 plus is covered.

The closer we get to leaving date the more it feels like time is dragging, and I've now possibly got the option to take VR at work.  Payment would cover my salary for 1 year.  I'm tempted.  Even if I'm not working we should still be able to contribute a further 50K to husband's pension over the next 2 years so really all we would be losing is my second year of salary and my pension contributions of around 15K per year.  Just to add if it all went totally wrong we wouldn't be against doing part-time work to fill the gap, and also have a fairly large property with no mortgage so the option to downsize if necessary (although not part of the plan if it can be avoided).  Grateful for any opinions to help me decide if going now is a good option.

NoMore

This is in the wrong forum, you've got the subforum about topping up state pension, you really want the parent forum Pensions, annuities & retirement planning — MoneySavingExpert Forum

anonanon321

Thanks, just noticed that and it won't let me delete or re-post.  

anonanon321

Looks like I'm in the right place now, can you tell I'm new to this   Long time reader but first time poster.

barnstar2077

anonanon321 said:

It's been about 5 years now since husband and I got really interested in FIRE and it feels like we've made good progress in the last few years.  Rough plan is to retire in 2 years time when we will be 53/55.  We would be happy with a joint income of £40K per year.

At the moment we have joint DC pots of £550K and cash / S&S ISAs of £200K.
DB pensions of £20K p.a. from 65 so once SPs kick in (and we will have full years by then) we feel like age 67 plus is covered.

The closer we get to leaving date the more it feels like time is dragging, and I've now possibly got the option to take VR at work.  Payment would cover my salary for 1 year.  I'm tempted.  Even if I'm not working we should still be able to contribute a further 50K to husband's pension over the next 2 years so really all we would be losing is my second year of salary and my pension contributions of around 15K per year.  Just to add if it all went totally wrong we wouldn't be against doing part-time work to fill the gap, and also have a fairly large property with no mortgage so the option to downsize if necessary (although not part of the plan if it can be avoided).  Grateful for any opinions to help me decide if going now is a good option.

Personally, I would take the VR.  Life is way too short and you never know what may happen in the future that will make these days seem all the more precious.

Assuming you will both qualify for your full state pensions, then your DCs and ISAs give you a lot of flexibility to slightly reduce your income in retirement if needs be while you come up with a new plan (if necessary.)

Check your State Pension forecast - GOV.UK (www.gov.uk)

Make sure you both check your eligibility though, it is not as straight forward as many people think!    

leosayer

I would bite their hand off.

Sarahspangles

VR seems like a good option, as you’re already so close. You may ‘save’ someone you work with from compulsory redundancy.

I keep saying - diplomatically - that I’ll only be semi retired and will consider part time or temporary work, but mainly to make friends/family feel better who don’t have the option, and maybe also because I don’t want to feel I’m ‘past it’. But as you’re at the other end of your 50s, it’s probably more of a viable option for you if you want or need to?

One thing I have found, is that it’s frustrating being the partner of someone who has already retired. Spring has finally sprung here and I’m stuck eating lunch at my home desk while OH is out enjoying it with his friends. He does ‘help’ round the house but I could do it so much more efficiently. But maybe if I’d retired first I’d have been stuck being a housewife, and it’s good that he’s getting into the habit.

anonanon321

I have checked state pension forecast again, I have 4 years to contribute which I will pay if I don't work again. However it mentions COPE element of £37 per week , does this mean I will never get full state pension?
Sarahspangles, very good point about frustration from OH, I know I would certainly resent it if he went first, but he says he wouldn't mind, I think he quite likes the idea of a cheerful housewife waiting at home! Would just have to ensure it didn't become permanent 😄.

MallyGirl

anonanon321 said:

I have checked state pension forecast again, I have 4 years to contribute which I will pay if I don't work again. However it mentions COPE element of £37 per week , does this mean I will never get full state pension?
Sarahspangles, very good point about frustration from OH, I know I would certainly resent it if he went first, but he says he wouldn't mind, I think he quite likes the idea of a cheerful housewife waiting at home! Would just have to ensure it didn't become permanent 😄.

There is plenty of info on this board about what the COPE figure means for you. Everyone is different - what matters is what your forecast says.

leosayer

COPE doesn't reduce your state pension - it refers to what you should be entitled to from an occupational (probably DB) pension. See the sticky on this board for an explanation.

Coincidental thing happened today - my employer started canvassing for VR applicants and I applied! Not sure my wife is looking forward to a househusband though.

tacpot12

I was in a similar position to yourself, but with a shorter time to go before I planned to retire. I took the VR and was very happy because the company was payingme to retire early. I'd recommend that if you do take the VR and feel that you have been slightly premature, you take a short break but then start job hunting for a near full-time role that you can do for a couple of years. This will cover two years of NI contributions automatically, and allow you to use your redundancy money to buy the other two years and ensure you start retirement with a good cash buffer. 

It's much easier to continue working that it is to retire and then try to restart. I retired five years ago (at 53), and have just started doing some paid consultancy for a friend (which will only last three months) but it's been a shock to the system to have to get back into the habit of working.