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  • FIRST POST
    • Gatser
    • By Gatser 14th Dec 09, 12:44 PM
    • 593Posts
    • 221Thanks
    Gatser
    Pensions Planning: The NUMBER
    • #1
    • 14th Dec 09, 12:44 PM
    Pensions Planning: The NUMBER 14th Dec 09 at 12:44 PM
    The NUMBER is how much income you need to "live comfortably"
    So What's your number?
    Very important for pensions planning, to know what you are aiming for.

    My Number? (for a couple)
    I calculated: £22,000
    based on
    Food £5,000
    Car/transport £5,000
    Bills/Utilities £4,500
    Holidays/Leisure £4,500
    Clothing/Cash/Xmas/Other £2,000
    Repairs/replacements £1,000
Page 68
    • michaels
    • By michaels 29th Jan 19, 6:53 AM
    • 22,575 Posts
    • 103,769 Thanks
    michaels
    Please explain (I thought the max allowed was 100%) ?

    Scrounger
    Originally posted by Scrounger
    Salary sacrifice down to NMW.
    Cool heads and compromise
    • justme111
    • By justme111 29th Jan 19, 7:01 AM
    • 3,298 Posts
    • 3,173 Thanks
    justme111
    60%- pah, I put 450% of my pre tax income into pensions and only work 3.5 days a week.
    Originally posted by michaels
    Yours is bigger !
    Yes but it still is less than 100%- where did 450% came from ?
    • TBC15
    • By TBC15 29th Jan 19, 3:01 PM
    • 801 Posts
    • 474 Thanks
    TBC15
    Please explain (I thought the max allowed was 100%) ?

    Scrounger
    Originally posted by Scrounger
    Probably gets paid in Bitcoin where anything is possible.
    • gallygirl
    • By gallygirl 2nd Feb 19, 6:52 AM
    • 16,778 Posts
    • 110,561 Thanks
    gallygirl
    A combination of being an auditor and Virgo means I do have to sweat the small stuff . For a good number of years I had no option but to do this and then when things got easier I just kept going as I had this fanciful notion of retiring at 60. That notion appeared around the time my state pension age increased to 66 (now 67). Closely analysing my spending identified where I could make easy savings on things like not buying lunches at work etc. Slowly my savings % increased and when I got a 35% pay rise I didn't let 'lifestyle creep' occur and just increased my savings rate. I still spent on holidays but looked for cheap flights etc.

    The notion of retiring at 60 was indeed fanciful as I retired at 53 . No way could I have achieved that if I hadn't sweated the small stuff.

    Now I still monitor spending, allocate spends to different pots and compare to budgets. I'm not anal about it, there are a number of fairly large balancing items every month . It helps me see where the spends are creeping up etc, and helps me identify how much I can afford to spend on food parcels for the UK post-Brexit .

    To be honest, I still feel I'm treating myself when I have my once or twice daily coffee at €1 - 1.40 a go. I won't mention how much we spend on eating out every month .
    A positive attitude may not solve all your problems, but it will annoy enough people to make it worth the effort
    Mortgage Balance = £0
    "Do what others won't early in life so you can do what others can't later in life"
    • michaels
    • By michaels 2nd Feb 19, 9:46 AM
    • 22,575 Posts
    • 103,769 Thanks
    michaels
    A combination of being an auditor and Virgo means I do have to sweat the small stuff . For a good number of years I had no option but to do this and then when things got easier I just kept going as I had this fanciful notion of retiring at 60. That notion appeared around the time my state pension age increased to 66 (now 67). Closely analysing my spending identified where I could make easy savings on things like not buying lunches at work etc. Slowly my savings % increased and when I got a 35% pay rise I didn't let 'lifestyle creep' occur and just increased my savings rate. I still spent on holidays but looked for cheap flights etc.

    The notion of retiring at 60 was indeed fanciful as I retired at 53 . No way could I have achieved that if I hadn't sweated the small stuff.

    Now I still monitor spending, allocate spends to different pots and compare to budgets. I'm not anal about it, there are a number of fairly large balancing items every month . It helps me see where the spends are creeping up etc, and helps me identify how much I can afford to spend on food parcels for the UK post-Brexit .

    To be honest, I still feel I'm treating myself when I have my once or twice daily coffee at €1 - 1.40 a go. I won't mention how much we spend on eating out every month .
    Originally posted by gallygirl
    To me this is what makes sense, knowing where it goes and that you can afford it. It seems the majority are blissfully unaware how much bigger a mortgage or nicer a holiday they could afford if they didn't spend 2 quid on a coffee.....times twice a day .....times 5 days a week.....times 50 weeks a year.
    Cool heads and compromise
    • Terron
    • By Terron 2nd Feb 19, 10:39 AM
    • 483 Posts
    • 486 Thanks
    Terron
    The notion of retiring at 60 was indeed fanciful as I retired at 53 . No way could I have achieved that if I hadn't sweated the small stuff.
    .
    Originally posted by gallygirl

    I planned to stop working at 60 from when I first took out a pension in my mid-20s, but I never "sweated the small stuff". I just saved a lot and only spent what was left. As my pay increased so did my spending, but not as fast When I was 53 I lost my job and then I looked at how much I had and found that I could retire then,.


    However living off my capital didn't feel right so I went into BTL and have been living off the income from that, which by the third year was greater than I would have been spening according if I was living off the capital. This year I turn 60 so can take my pensions as originally planned. (I did dip into my SIPP last year for my first proper holiday in 5 years and a new bathroom).
    • Thrugelmir
    • By Thrugelmir 2nd Feb 19, 10:47 AM
    • 63,703 Posts
    • 56,412 Thanks
    Thrugelmir
    To me this is what makes sense, knowing where it goes and that you can afford it. It seems the majority are blissfully unaware how much bigger a mortgage or nicer a holiday they could afford if they didn't spend 2 quid on a coffee.....times twice a day .....times 5 days a week.....times 50 weeks a year.
    Originally posted by michaels
    Or the £39 a month spent on a contract to have the latest rendition of the iPhone. While not having time in the mornings to make lunch for work. Instead spending several £'s a day on a meal.

    Then complain endlessly about the lack of a decent annual payrise.......
    “The stock market is a device for transferring money from the impatient to the patient.” – Warren Buffett
    • cfw1994
    • By cfw1994 20th May 19, 8:01 AM
    • 328 Posts
    • 270 Thanks
    cfw1994
    Probs time to resurrect this great thread for newer fans of this forum!
    <snip>
    However living off my capital didn't feel right so I went into BTL and have been living off the income from that, which by the third year was greater than I would have been spening according if I was living off the capital. This year I turn 60 so can take my pensions as originally planned. (I did dip into my SIPP last year for my first proper holiday in 5 years and a new bathroom).
    Originally posted by Terron
    Is the BTL still working well? My broad understanding was that there were changes this year that negatively impacted them....but curious to know short detail from one involved!!

    A combination of being an auditor and Virgo means I do have to sweat the small stuff
    <snip>

    The notion of retiring at 60 was indeed fanciful as I retired at 53 . No way could I have achieved that if I hadn't sweated the small stuff.

    Now I still monitor spending, allocate spends to different pots and compare to budgets. I'm not anal about it, there are a number of fairly large balancing items every month . It helps me see where the spends are creeping up etc, and helps me identify how much I can afford to spend on food parcels for the UK post-Brexit .

    To be honest, I still feel I'm treating myself when I have my once or twice daily coffee at €1 - 1.40 a go. I won't mention how much we spend on eating out every month .
    Originally posted by gallygirl
    Whereabouts is the coffee that cheap? I’m guessing not UK!

    My challenge, I suspect, will be curbing the larger purchases. I do “sweat the small stuff” a lot, but whilst earning I find it is easy to make those purchases without too much hassle....

    Back on topic (The Number)...I like crv1963’s take (on a rogue parallel thread!!):
    Bearing in mind no mortgage, reduced work costs- as it will be minus NI, Pension Saving and work travel costs- our targets all after tax are-

    1) 1500 pm= reasonable living retirement, includes a UK holiday.
    2) 2000 pm= pleasant retirement, includes an EU holiday.
    3) 2500 pm= pleasant retirement, includes some wider World travel.
    4) 3000 pm= very pleasant retirement, do almost everything we want.
    5) 5000 pm= luxury retirement.

    All of the above with a 20k savings pot set aside for emergencies.
    Originally posted by crv1963
    I fully expect to stop the daily grind before I hit 56, & am targeting £2.5-3k pcm as a decent sum to play with in general (which I think would allow us still to help our “kids” out as they finish uni education)
    ....plus I have some numbers above and below for “more luxurious” & “more frugal” years.
    Seeing as a chunk of ours will be from DC schemes, it feels right to be flexible in that regard: if markets take a big hammering, then some part-time work and perhaps scaling back travel would be needed.
    • Brilley
    • By Brilley 20th May 19, 8:33 AM
    • 34 Posts
    • 27 Thanks
    Brilley
    ..a great thread and well worth a re-boot.

    We went a couple of years ago, (58), initially very much a bit of worry regarding "have we got enough". 20+ year of recording expenditure indicated we were spending an average of £24k per year. Factoring in the occasional "big spend" (eg car), increased this to an overall average of £26k. However when you are both working full time you don't get the time to spend it! My OH has now started taking their works pension which has taken the pressure of drawing down our savings pre SPs in another 5 five years.

    My long term budget suggests we could spend considerably more (£35k+), but after years of "saving" we are finding it a difficult habit too break!
    • crv1963
    • By crv1963 20th May 19, 8:44 AM
    • 926 Posts
    • 2,082 Thanks
    crv1963
    Probs time to resurrect this great thread for newer fans of this forum!


    Is the BTL still working well? My broad understanding was that there were changes this year that negatively impacted them....but curious to know short detail from one involved!!



    Whereabouts is the coffee that cheap? I’m guessing not UK!

    My challenge, I suspect, will be curbing the larger purchases. I do “sweat the small stuff” a lot, but whilst earning I find it is easy to make those purchases without too much hassle....

    Back on topic (The Number)...I like crv1963’s take (on a rogue parallel thread!!):


    I fully expect to stop the daily grind before I hit 56, & am targeting £2.5-3k pcm as a decent sum to play with in general (which I think would allow us still to help our “kids” out as they finish uni education)
    ....plus I have some numbers above and below for “more luxurious” & “more frugal” years.
    Seeing as a chunk of ours will be from DC schemes, it feels right to be flexible in that regard: if markets take a big hammering, then some part-time work and perhaps scaling back travel would be needed.
    Originally posted by cfw1994
    Making purchases whilst earning does make it seem easier, we are trying to make the big ticket items whilst working. All about balance, I just hope we are getting it right.

    We are trying to help my sons out a bit but they are also quite clued up on savings/ pensions/ saving to buy a house.

    Our main thrust is of course putting as much as we can into Mrs CRV SIPP, and build a cash fund to fall back on in the event which will come of a down turn so making draw down need to reduce or stop until the markets recover.
    CRV1963- Light bulb moment Sept 15- Planning the great escape- aka retirement!
    • gallygirl
    • By gallygirl 26th May 19, 9:22 PM
    • 16,778 Posts
    • 110,561 Thanks
    gallygirl


    Whereabouts is the coffee that cheap? I’m guessing not UK!
    Originally posted by cfw1994
    No, in Spain
    A positive attitude may not solve all your problems, but it will annoy enough people to make it worth the effort
    Mortgage Balance = £0
    "Do what others won't early in life so you can do what others can't later in life"
    • rnj
    • By rnj 26th May 19, 10:47 PM
    • 28 Posts
    • 24 Thanks
    rnj
    Im clearly not spending enough, I did a retirement calculator, i think it was on pensions advisory site, they estimated id need more in retirement than i spend now!
    • enthusiasticsaver
    • By enthusiasticsaver 26th May 19, 11:17 PM
    • 8,765 Posts
    • 20,362 Thanks
    enthusiasticsaver
    Im clearly not spending enough, I did a retirement calculator, i think it was on pensions advisory site, they estimated id need more in retirement than i spend now!
    Originally posted by rnj
    That does not surprise me as we are spending more in retirement than we did while working.

    You have more time when retired to spend on hobbies, eating out, travelling and diy which all cost money.

    You are home more so fuel bills higher as heating etc on during the day.

    Although you may not have commuting costs there may be fuel to pay for days out etc.

    What you spend in retirement depends on what sort of retirement you want to have but it may not translate to the same expenditure as when working.
    Early retired in December 2017

    I'm a Board Guide on the Debt-Free Wannabe, Mortgages and Endowments, Banking and Budgeting boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Any views are mine and not the official line of moneysavingexpert.com. Pease remember, board guides don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com
    • Terron
    • By Terron 27th May 19, 12:11 AM
    • 483 Posts
    • 486 Thanks
    Terron
    Is the BTL still working well? My broad understanding was that there were changes this year that negatively impacted them....but curious to know short detail from one involved!!
    Originally posted by cfw1994

    Sorry missed this earlier.
    Yes, BTL is still working well for me overall.Mortgage tax relief is being reduced gradually, with another step this year, The way it works is not simple though and as a basic rate tax payer it has not affected me yet. It might next year with pensions pushing up my income.
    • SkyFae
    • By SkyFae 26th Jun 19, 8:40 PM
    • 4 Posts
    • 4 Thanks
    SkyFae
    Pension plannning without panic overload
    i'm really struggling to work out my pension needs Number.

    I have anxiety issues mixed with socialphobia and get extremely paranoid about not having enough money to the point that my sister is concerned that I have got into a bad mind loop.

    I currently double down on my mortgage and make a annual overpayment too, I was careful on my research making sure I wouldn't get penalised for this as I have fell foul of that before. So wont have that worry soon.

    but no matter how much research I do on Mortgages I end up panicked to the point of Anxiety shakes that I am not putting enough away.

    also I have the confusion of 2 frozen self-created pensions, 1 frozen final salary pension and now a fairly new Stakeholder pension. making what I have already got a harder pot to calculate.

    I can meet up with a Financial Advisor as i'm not good at face to face.

    does anyone know of a handy spending calculator or pension calculator so I can at least work out if I have enough as cash, even if I cant work out how much I would get a year/month/week any other way.

    the recent ITV show about how people were trying to survive on pension money after bills didn't exactly help my state of mind.

    apologies if this is the wrong place for my question
    • crv1963
    • By crv1963 27th Jun 19, 8:20 AM
    • 926 Posts
    • 2,082 Thanks
    crv1963
    i'm really struggling to work out my pension needs Number.

    does anyone know of a handy spending calculator or pension calculator so I can at least work out if I have enough as cash, even if I cant work out how much I would get a year/month/week any other way.

    the recent ITV show about how people were trying to survive on pension money after bills didn't exactly help my state of mind.

    apologies if this is the wrong place for my question
    Originally posted by SkyFae
    There are pension needs calculators but they give a rough rule of thumb- try Aviva or Hargreaves Lansdown sites.

    Don't panic about it, simply sit down, write down what you have already- pot sizes and then an estimate of the income- the calculators can do this for you based on pot size, or you can self estimate- we use a 3% rate so 100k gives 3k pa pension, others use higher numbers such as 4 or 5%.

    Then add in SP- we use 8.5k pa.

    That way you arrive at a very rough estimate of income at SPA. Figure 1.

    Next your income needs- all your fixed bills, utilities, council tax etc. Don't include Mortgage or work related costs or pension savings as you won't have these hopefully on retirement. Figure 2.

    If one is greater than two you have enough to manage.

    Next look at quality of life, or what you would like in retirement and what it costs, Figure 3. If Figure one is greater than three again you have it sorted. If not then it is a case of adjusting your expectations in retirement, or saving more, or working longer or a combination of the three.

    We worked out-

    1) Our must have income- basics paid, have a bit of a life.
    2) Our would like income- as above plus monies for EU holidays, cars.
    3) Our luxury would like income, as both above plus world wide or long haul holidays and helping the next generation with larger sums of money.

    We are aiming for luxury level but will be content on the middle figure if that is what we end up with.

    Everyones number is slightly different, ability to save changes and don't forget to live a life now. Anxiety about it all does nothing for the future and robs you of peace now. If getting anxious, use distraction to something else and return to it when you are calmer. The one good thing is that it is in the future so you have time to make adjustments now and planning is better than no planning.
    CRV1963- Light bulb moment Sept 15- Planning the great escape- aka retirement!
    • CWSmith
    • By CWSmith 27th Jun 19, 8:28 PM
    • 403 Posts
    • 792 Thanks
    CWSmith
    We took slightly early retirement a couple of years ago and (what joy!) our outgoings/spending has turned out to be substantially less than we anticipated.

    Ok, we moved from the SE to Cornwall where the winters are wetter but warmer, so our heating bills have decreased.
    With more time to shop around and cook, our food bills have also decreased and I'm sure we are eating at least as much as before.
    Without requiring "good" work clothes, and with time to indulge my hobby of needlework, our clothing bill has decreased and yet we have more clothes.
    Even with going on outings regularly, our car fuel bills are nowhere near what our work fuel bills were.
    The biggest surprise, Cornish car repairs / tradespeople etc. are a fraction of Surrey prices!

    It's all good!
    • justme111
    • By justme111 27th Jun 19, 10:17 PM
    • 3,298 Posts
    • 3,173 Thanks
    justme111
    When my friend from Northamptonshire came here and went to a garden centre with me she bought all plants her car could fit in as she says it is much cheaper.
    The word "dilemma" comes from Greek where "di" means two and "lemma" means premise. Refers to difficult choice between two undesirable options.
    I came across so many occasions when people use the word without understanding what it means I decided to use the definition above as a signature.
    • westv
    • By westv 28th Jun 19, 7:45 AM
    • 4,835 Posts
    • 2,420 Thanks
    westv
    We took slightly early retirement a couple of years ago and (whThe biggest surprise, Cornish car repairs / tradespeople etc. are a fraction of Surrey prices!
    Originally posted by CWSmith

    Presumably you are surprised how much cheaper they are rather than being surprised they are cheaper. I think Cornwall is, in some ways, quite a deprived part of the UK.
    • CWSmith
    • By CWSmith 28th Jun 19, 12:55 PM
    • 403 Posts
    • 792 Thanks
    CWSmith
    Presumably you are surprised how much cheaper they are rather than being surprised they are cheaper. I think Cornwall is, in some ways, quite a deprived part of the UK.
    Originally posted by westv
    It doesn't come across as deprived at all. Just different. The pace of life is so much slower and laid back than in Surrey, honestly, it felt like we had time-travelled back to the 1970s when we first moved. It's another world. There is no great urgency, or sense of acquisitiveness. Sorry, off topic somewhat.
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