Retirement planning advice

pedro789

Hi

I'm 56 working in ft employment, earning £56,000 p/a with a rental property bringing in £10,000 p/a.

I have a local govt pension that I’ve deferred (25 years in local government) and some other savings.

- Local govt AVC £65,000 - deferred since leaving local govt

- Vanguard S&S Isa (Lifestrategy 60/40) £80,000 - not making any contributions

- AJ Bell S&S Isa (HSBC FTSE All World Index) £5000 - £200 p/m

- Cash Isa £16,000 - no contributions

I’m contributing 50% of my salary into Scottish Widows workplace pension about £2800 p/m and that’s now about £40,000.

I would like to retire in 2-3 years. My plan is to build up my workplace pension as much as poss and then use that until I can take local govt pension (without any reductions for taking early).

I don’t have mortgage on my own house or rental property, so my outgoings aren’t that much. We live pretty modestly - 10 year old car, couple of hols each year, odd days/meals out.

Ideally I’d like £25,000 - 30,000 per year in retirement until I can take local gov/state pension. 

Does this sound like a reasonable approach? Should I get IFA as I get closer to retirement? 

Everyone seems to be talking about market crash and worried I should be doing something to mitigate against that

Would appreciate any thoughts. Thanks a lot.

SarahB16

Your approach is not that dissimilar to mine (i.e. I hope to retire aged 61/62 and take my LGPS pension and AVC fund at 65).

Couple of key observations:

Looking at your proposal have you set out what your income sources will be from when you intend to retire until 67 (presuming that’s the year you intend to take your LGPS and state pension (and do check you’re on track for receiving that in full)) to ensure you have sufficient funds in place?

I think from age 67 you will have nothing to worry about (however you have not stated what your LGPS pension is likely to be). 

I’m not entirely clear from what you have shared if you have sufficient funds for the years until you reach the age of 67 (or you may be wishing to take your LGPS at 65 depending on what the normal retirement age is for you, i.e. is the majority of it pre-2014 contributions).    

If you set this out in a simple spreadsheet, i.e. income required (start off with net requirement per annum of £25,000 - £30,000) and the sources (from your rental income, pension, S&S ISA etc) you will be able to see if you have a shortfall in the years up until you reach 65 or 67.   

leosayer

You hinted you have a partner. Does your income requirement include any pension provision they might have? 

Do you have full state pension? 

What LGPS pension have you accrued?

El_Torro

If you are planning to retire in two to three years then I think you need to start looking at having some safe money. By that I mean more cash, or safe investments like short term money markets. This could be in your ISA, or your pension, or a combination of the two. I think any money that you plan to use within the next 5 years shouldn't really be in a 60/40 fund or global tracker.

It's also good that you are putting what you can into a pension. 

molerat

Once you are retired with no relevant income a little wheeze would be to take £3600 taxable from the pensions then put £2880 back in.  That would be cost neutral and the £3600 taxable withdrawn would turn into £900 tax free and £2700 taxable back in the pension.

Albermarle

You do not say how your workplace pension or your AVC is invested, so it not possible to have a view at what risk level all your investments combined are.