earlyish retirement plan

Bostonerimus1

Think of all the things that could go wrong - Bitcoin falls off a cliff, stock market crashes, you get divorced. If your plan can survive all that then go for it. However, I think you are being a bit optimistic right now.

ha-pajama

not much could survive all that bostonerimus1 
But i hear what you're saying.

Albermarle

The thing that puzzles me, is when I ask AI - they tell me the typical person retires with approx 100K net wealth excluding property.  when i read this forum, my 400K seems really low.   I'd love to know if anyone has successfully retired with between 400 - 600K wise?

You have to remember that having hundreds of thousands of Pounds of savings etc is not the norm for most people. Neither is earning £50K +
Most working people on average wages retire at 65 ish often without much in the way of pension, savings etc
Then they survive on a relatively low income.

You are taking about retiring at 53, on £45K pa . It is a different scenario altogether.

Notepad_Phil

ha-pajama said:

Thanks both for your posts.  
The thing that puzzles me, is when I ask AI - they tell me the typical person retires with approx 100K net wealth excluding property.  

I suspect that might be true for people retiring at or near to state pension age. But they've got the benefit of both a state pension that would imminently be paid out (and possibly a company final salary pension too) and a lot fewer years on which the £100k needs to keep them in the manner that they might like to live. I guess the AI doesn't tell you how happy the typical retirees are once they've retired with that amount?

ha-pajama said:

I'd love to know if anyone has successfully retired with between 400 - 600K wise? 

Realistically in my view at your ages you should only be drawing out a max of £12k to £14k from a £400k pot - so yes you could possibly drop your hours, but in my view you'd be better to continue with your full time jobs and maybe let loose your spending a bit and think about retiring in 5 years or so.

ha-pajama

thanks both.   

Just to clarify, I wouldn't be drawing at all on the pot until 60ish, or later.   the plan would be to stop investing more money - let the pot grow with it's current investments. 
And to continue to work to pay for our lives until age 60 or so, depending upon pot value at that time.

Hoenir

How will BTC compound ? 

There's an interesting US research document that shows the correlation between the BTC price and the total amount of US $ in circulation. QT may well be the ultimate dampener over time. 

michaels

ha-pajama said:

hi there, 

My partner and I are looking at our retirement options.  We are 51 and 53 years old. 
Currently have approx 400K - 50% in btc and 50% in pension/isas that follow the stock market. 

What I'm thinking is, we could stop working so hard and not focus on accumulation/saving of money and move into working to pay for our current lifestyle (still have 2 kids we pay for) and use appox 45K over the year, with a fairly loose approach to spending where we don't really look for deals hugely hard or watch too closely what we're spending.   

So both of us would need to continue to bring in around 20K each but could then reduce our hours to us doing 2-3 day working weeks each. 

Letting compound interest work it's miraculous effects and we are working on easy street for the next 5 years or so.

Has anyone else done a gradual shift into retirement like this, and how did it work out.  Any one got any suggestions/critics of our plan - I'm keen to hear  

Thanks, 

Pajama

Are you really happy with the volatility from having 50% of your wealth in a single asset class - sure it has had a good 'run' recently but that simply demonstrates the volatility.  You might as well head to the bookies if you like high stakes gambling.

ha-pajama

apricate the view but, i don't think holding something long term is the same as going to a bookie and gambling.  i've done a fair bit of research on btc and personally i do believe in it.  but obvs, many, many people don't agree and that's fine. 

many people have 50% of their wealth in one thing.  whether it's a fund/property or whatever.

the compounding is on the pension stuff/isa stuff. 
bitcoin i see as an asset that's value will rise, digital gold and all that...  unfortunately rising largely due to the economic climate and debt globally and devaluing £'s $'s etc.

Hoenir

ha-pajama said:

apricate the view but, i don't think holding something long term is the same as going to a bookie and gambling.  i've done a fair bit of research on btc and personally i do believe in it.  but obvs, many, many people don't agree and that's fine. 

many people have 50% of their wealth in one thing.  whether it's a fund/property or whatever.

the compounding is on the pension stuff/isa stuff. 
bitcoin i see as an asset that's value will rise, digital gold and all that...  unfortunately rising largely due to the economic climate and debt globally and devaluing £'s $'s etc.

Doesn't bother me what people hold in their investment portfolio's. As views drive markets and provide opportunties.  Seems you are wedded to your plans. Have all the answers. So in Dragon's Den speak. I'm out. 

Patrol

Have you tried drawing up any sort of plan with a degree of pessimism built in to cover downside cases. e.g.

Current 'pot' of 200k investments, 200k bitcoin
3 day week for next 7-9 years covering costs and not adding much to savings
Pot compounding around 4%, say 550k
Requiring ~33k from pot each year from age 60 to 67/68 (lets say 250k, leaving 300k)
Say pot increases by 100k compounding between 60-67 (so back to pot of 400k again)
Do you both have full state pension forecasts
- If so, say 20k income from pensions after 67, requiring 13k from investments (about 3% return from pot)
- If not, say 10k income from pensions, meaning 23k from investments (5-6% return)

On that basis it looks kind of workable but all sorts of assumptions and risks (not to mention shaky maths!)

Note I regard bitcoin as speculative  on the basis it has no tangible underlying assets and if confidence goes so does it's 'value'. I don't see how any research can determine that won't happen but each to their own