plan to FIRE - how to draw down

Bostonerimus1

sgx2000 said:

As a mere pauper on this forum...
I would have to say that, with this amount of money involved, you really should pay for a top quality IFA.....

The basic principles of personal finances don't change much however much you have. The OP is getting to a stage where they might emphasize tax planning a bit more than investment strategies, but really there's no need to make things overly complicated or a desperate need for an IFA. If you have millions in income then things do get complicated and you might move to somewhere like Monaco or set up overseas structures, but millions invested to generate 10s of thousands in income doesn't need any esoteric solutions.

aldershot

If you've managed to amass £1.7mil with the house paid off before 50, well done.

Comments on this thread have concentrated on the investment side of things. What I would suggest is that your spending estimate at £60k pa is too low. Have you really examined your budget line by line? Still got kids at home? University fees?

If you've been earning serious money, you probably spend it too. 

We both retired in our mid 50's 6&7 years ago having accumulated good savings and pensions from the City. I had a good handle of our spending have used Microsoft Money since 1993! It's still going strong. Early retirement can be expensive. If you're used to shopping in Waitrose and not sitting at the back of the plane, you're not likely to want to change that too much just because you're no longer working.

I've been surprised (but perhaps not that surprised really) on how much we spend. We could shop in Poundland,  holiday in Butlins and drive a banger, but we didn't before and we don't wish too now. House maintenance is expensive. Have you allowed for that? Motoring expenses, capital and servicing, have really jumped. Don't get me wrong, investments have performed really well and we're still way ahead of where I had originally budgeted, but inflation, particularly service inflation, has been high and I think anyone thinking of FIRE really needs to drill hard on the costs and be seriously realistic on their lifestyle and how that might look in your 50's. 60's, 70's and beyond.  

Lu999

aldershot said:

If you've managed to amass £1.7mil with the house paid off before 50, well done.

Comments on this thread have concentrated on the investment side of things. What I would suggest is that your spending estimate at £60k pa is too low. Have you really examined your budget line by line? Still got kids at home? University fees?

If you've been earning serious money, you probably spend it too. 

We both retired in our mid 50's 6&7 years ago having accumulated good savings and pensions from the City. I had a good handle of our spending have used Microsoft Money since 1993! It's still going strong. Early retirement can be expensive. If you're used to shopping in Waitrose and not sitting at the back of the plane, you're not likely to want to change that too much just because you're no longer working.

I've been surprised (but perhaps not that surprised really) on how much we spend. We could shop in Poundland,  holiday in Butlins and drive a banger, but we didn't before and we don't wish too now. House maintenance is expensive. Have you allowed for that? Motoring expenses, capital and servicing, have really jumped. Don't get me wrong, investments have performed really well and we're still way ahead of where I had originally budgeted, but inflation, particularly service inflation, has been high and I think anyone thinking of FIRE really needs to drill hard on the costs and be seriously realistic on their lifestyle and how that might look in your 50's. 60's, 70's and beyond.  

I guess we are too frugal.  My hubby just told me we haven't gone out to restaurant for a month.  (we did host a few bbqs for friends though, that might explain as we gear towards free activities)
House maintenance is a thing that we are new to so I just budgeted approximately 5k for a 4bed terrace.

Lu999

Bostonerimus1 said:

sgx2000 said:

As a mere pauper on this forum...
I would have to say that, with this amount of money involved, you really should pay for a top quality IFA.....

The basic principles of personal finances don't change much however much you have. The OP is getting to a stage where they might emphasize tax planning a bit more than investment strategies, but really there's no need to make things overly complicated or a desperate need for an IFA. If you have millions in income then things do get complicated and you might move to somewhere like Monaco or set up overseas structures, but millions invested to generate 10s of thousands in income doesn't need any esoteric solutions.

@Bostonerimus1, I am on similar opinion and actually  was in a (free) seminar where the IFA sent me away as they required 3m under investment at their account to be effective.  so DIY ?
I am really curious if someone can share how IFA could help them and share some actual case please?

peterg1965

Sorry, stupid question what's FIRE?

Bostonerimus1

peterg1965 said:

Sorry, stupid question what's FIRE?

Financial Independence Retire Early

Bostonerimus1

Lu999 said:

Bostonerimus1 said:

sgx2000 said:

As a mere pauper on this forum...
I would have to say that, with this amount of money involved, you really should pay for a top quality IFA.....

The basic principles of personal finances don't change much however much you have. The OP is getting to a stage where they might emphasize tax planning a bit more than investment strategies, but really there's no need to make things overly complicated or a desperate need for an IFA. If you have millions in income then things do get complicated and you might move to somewhere like Monaco or set up overseas structures, but millions invested to generate 10s of thousands in income doesn't need any esoteric solutions.

@Bostonerimus1, I am on similar opinion and actually  was in a (free) seminar where the IFA sent me away as they required 3m under investment at their account to be effective.  so DIY ?
I am really curious if someone can share how IFA could help them and share some actual case please?

I'm in a similar situation to you with substantial invested assets and retirement income from pensions and eventually state pensions and no debt to worry about. I live simply and so my tax bill is not large as my income is not that large either. I leave my investments to compound and make withdrawals and transfers mostly for tax planning reasons and to make gifts to family and charities. I DIY invest in low cost equity index funds.