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  • FIRST POST
    • Marine_life
    • By Marine_life 5th Nov 10, 9:46 AM
    • 985Posts
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    Marine_life
    Early-retirement wannabe
    • #1
    • 5th Nov 10, 9:46 AM
    Early-retirement wannabe 5th Nov 10 at 9:46 AM
    I would like to create a topic (don't see it at the moment - other than the NUMBER thread).

    Who is aiming for early retirement (or who has retired early already)?
    When did you begin planning and what drove the decision?
    What is the strategy for getting there?
    How much of a relative decline in income are you prepared to take / did you take?
    What are your main concerns?
    For those already in early retirement - how is it progressing? What have been the good and bad surprises (financial and otherwise)?

    I will post my strategy but wanted to get some thoughts
Page 1
    • Linton
    • By Linton 5th Nov 10, 10:53 AM
    • 10,728 Posts
    • 11,099 Thanks
    Linton
    • #2
    • 5th Nov 10, 10:53 AM
    • #2
    • 5th Nov 10, 10:53 AM
    I would like to create a topic (don't see it at the moment - other than the NUMBER thread).

    Who is aiming for early retirement (or who has retired early already)?
    When did you begin planning and what drove the decision?
    What is the strategy for getting there?
    How much of a relative decline in income are you prepared to take / did you take?
    What are your main concerns?
    For those already in early retirement - how is it progressing? What have been the good and bad surprises (financial and otherwise)?

    I will post my strategy but wanted to get some thoughts
    Originally posted by Marine_life

    To answer your questions one by one:

    1) I retired at 56, 5 years ago.

    2) Serious planning - about 6 years previously. However from about 35 I was maxing out on pension contributions and had started on serious investing from around 45.

    Driver - I realised that I would be in a position not to need to work and the increasing stress associated with a well paid job was becoming less justifiable. Anyway IMHO there are better things to do with ones life.

    3) Strategy:
    a) Decide how much income you want to retire on. To do this you need to know how much your are spending, on what, now. Just budgetting bottom up isnt a good guide.
    b) Have good money and investment management tools so you know what you've got in detail without the need to repeatedly work it all out from scratch.
    c) Put all your spare income into tax free investments - ie shares and funds. Doing this is vital. Whether those savings are ISAs or Pensions is a secondary matter.
    d) Spend hours on a detailed plan to cover you and dependents until you are 90 at least. I used MSMoney lifetime planner, but its doable with a spreadsheet. You will need to have a column (or row) per year and calculate inflation adjusted assets at start,income and expenditure, assets at close. Make reasonably pessimistic assumptions on inflation and investment reuturns - I used 3% and 4%. Also understand how much increase in inflation/drop in returns would seriously compromise the plan.
    e) Educate yourself on investing, pensions & annuities etc
    f) From the plan you know what asset base you need, so when you get there - jump, ideally at the same time as your employer is offering voluntary redundancies.

    4) I planned on a 10% increase in expenditure, rising with RPI. It's better to work from expenditure rather than income.

    5) I dont have any major concerns, though halfway through the credit crunch I was possibly getting a little worried.

    6) Despite the credit crunch progress is much better than planned. My total assets in cash terms are larger than when I retired. I am having difficulty spending as much as planned, though trying hard! It is clear to me that RPI is a very pessimistic measure.


    Retirement isnt just a financial matter - you do need to know beforehand how you want to use your time in the long term. There would be nothing worse than retiring and then spend the rest of your life watching daytime TV because you have nothing better to do.
    • Marine_life
    • By Marine_life 5th Nov 10, 11:28 AM
    • 985 Posts
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    Marine_life
    • #3
    • 5th Nov 10, 11:28 AM
    • #3
    • 5th Nov 10, 11:28 AM
    Linton

    Thanks - very interesting.

    Makes me realise that really have got a lot of work to do. The main problem for me (us) is that I really have no idea what our current expenditure is. Of course I know what the big chunks are (House, Car etc) but have not been tracking how much we spend on (for example) food. I think for day to day items we are quite frugal, don't eat out a lot, don't spend a lot on lunches (I make my own) but the money goes on big things and house maintenance.

    You mention an increase in expenses of 10% (if I understood that right). Was that to cover the increasing cost of just "being"? Did you not have any savings on things like travel costs? How accurate was your 10% estimate?

    I assume you have a pension which funds your day-to-day expenses ?

    I have a million other questions but I will keep it light for now.
    • hugheskevi
    • By hugheskevi 5th Nov 10, 12:15 PM
    • 2,257 Posts
    • 2,947 Thanks
    hugheskevi
    • #4
    • 5th Nov 10, 12:15 PM
    • #4
    • 5th Nov 10, 12:15 PM
    When did you begin planning and what drove the decision?
    In 2008, aged 30. I'd been planning before then, but the house price decline meant that I had to do more serious consideration, as for the first time I would be entering into illiquid investments (housing and extra pensions). Before then I'd simply not worked part of the year and gone travelling instead to avoid higher rate tax, not wanting to buy into an overvalued market.

    What is the strategy for getting there?
    Pensions, ISAs, money from property by moving out of London, possible inheritance (not building this into plans, but it is something that may well happen at some point - it would bring things forward if it does).

    The plan is for both myself and my partner to pension off all higher rate tax income and make full S+S ISA contributions each year. To achieve that, a reasonably high mortgage is maintained, which will either be paid off when I retire and go travelling, or if inheritance happens in the mean-time.

    As I get closer, I'll refine the balance between liquid assets and pensions, but for the time being there are no concerns there, and I'll maximise pension investment whilst I have annual allowance available and higher rate tax relief available.

    How much of a relative decline in income are you prepared to take / did you take?
    I've never lived to the standard I could have done if I had used all my income, so declines in income are not relevant.

    I base my plans on maintaining current expenditure levels, with a lot of caution built in such that in practice I expect to have higher expenditure available in all bar the worst case.

    What are your main concerns?
    In order:
    • Job loss
    • Government changes pension rules again, in particular access at age 55, or lowers Annual Allowance
    • A long-term decline in nominal house prices
    • A long-term stagnation of investment returns
    Last edited by hugheskevi; 05-11-2010 at 12:18 PM.
  • bendix
    • #5
    • 5th Nov 10, 12:40 PM
    • #5
    • 5th Nov 10, 12:40 PM
    I'm 46 and will be retired by the time I am 50, possibly earlier. I could retire today but am prudently deciding to make hay while the sun shines and continue saving hard, notwithstanding the considerable personal sacrifices I'm currently making.

    I decided I wanted to do this five years ago, and have basically saved as hard as a I could in the interim, building up a solid cash pile, a paid-for property and now I'm working on the pension side of the equation. The strategy is simple - live off the income from the cash pile without eating into the capital from, say, 50-55 - and then boost my income with income drawdown on the pension fund which should be a decent size by then.

    As a previous poster has said, the 'decline' in income post-working isn't a consideration. I earn a high salary and spend a tiny fraction of it - my living costs are miniscule. I plan to retire overseas where I already have a home so, in fact, my living costs post-retirement will be even less then. If I retired today and used what assets I have, I would seriously struggle to spend the forecast income although I'm sure Mrs Bendix would find a way to blow it.

    I have no major concerns - not financial ones anyway. My assets are spread in various asset classes and in various geographies around the world so I do pay a huge amount of attention to FX markets, but at the end of the day when I crystalise those assets, that will be less of an issue.
    • Loughton Monkey
    • By Loughton Monkey 5th Nov 10, 12:58 PM
    • 8,706 Posts
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    Loughton Monkey
    • #6
    • 5th Nov 10, 12:58 PM
    • #6
    • 5th Nov 10, 12:58 PM
    My own situation has been posted several times before. A remarkable similarity to the above post of Linton:

    I retired age 56. Built a retirement model around age 50 to tell me at what stage I could retire. My criteria included: 1. Cautious assumptions, 2. Must be able to continue spending exactly as when working (with inflation provision for life, of course).

    Also, I'm now 5 years into it, and worth about 11% more than I was 5 years ago.

    You will find there's a "virtuous circle" to this. If you build an excel model that doesn't lie or exaggerate, then it informs you adequately when you can retire. Provided the 'default' answers are pretty much close to what you want to hear, then the motivating part is 'controlling' your life (financially) from then on to meet the assumptions you've already made. Or even exceeding them.

    It is my strong opinion that the vast majority of people complicate it for themselves. The evidence is clear - by finding all the posts along the theme of "How much do I need to save..." or "Should I save in Pension X and will it be enough....". My main point here is that the "Focal point" for your deliberations must be spending. This is the real subject and not 'saving'.

    Thinking this way simplifies and clarifies things no end. Because the fact of the matter is you are spending now. You will spend in the future, and you will want to spend when you retire. The shape and profile of your spending changes over time, but what you spend now and in the future is the key thing.

    It then follows, that if you are spending everything you earn, then savings doesn't enter into it. If you spend less than you earn, then by definition you are 'saving' the balance. So model what you spend and want to spend in the future. And then wrap around that what your income will be - earned and unearned (interest). The resulting calculation then tells you when you can retire.

    If this gives unsatisfactory answers? Then go back to the drawing board. The answer, invariably, is to spend less. [Yes, I know this is really the same as saving more, but I very strongly counsel you to think from the spending angle. Because that's what lifestyle really means.]

    Once you have a reasonably cogent retirement plan, then that's half the battle. NOW you can concentrate on more detailed, and sometimes challenging issues about pension choices, fund choices, savings strategies, interest rates, tax management.....
    • Marine_life
    • By Marine_life 5th Nov 10, 1:38 PM
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    Marine_life
    • #7
    • 5th Nov 10, 1:38 PM
    • #7
    • 5th Nov 10, 1:38 PM
    I should mention I was 46 last week and looking to retire before 55 (earlier if the sums add up)

    Ok, I am getting the strong message so far that focus in the first instance. I have a figure in my head which could be wildly wrong. I think the comment about not spending (and saving the balance) is very appropriate i.e. at the moment we really do not track spending very closely (as we do not have to) and therefore we simply save what is left.

    I plan to split my current spending into 4 buckets:

    1. Expenditure that I expect to fall away (school fees! Mortgage interest hopefully)
    2. Money going into saving at the moment.
    3. Day-to-day expenditure.
    4. Discretionary spend (cars, holidays, capital goods etc).

    I suspect I will be left with a gap which I think will be money that "leaks" away i.e. I can't account for it - Clearly if I start imposing some discipline I am to get much clearer on that.

    I would be interested to hear from some of the posters on category 4. I am guessing we would be able to manage with one car but that might be balanced by increased spending on holidays.

    The other big question will be where do we live. We have some equity in our home but also a big mortgage. We also own a holiday apartment. If we sold the two we might end up with around 300,000 net which would probably be enough to buy a decent property (although not as big as our current house)

    Oh.....and of course I did not forget the non-financial category - what do you do with the spare time you have available now?
    • crux
    • By crux 5th Nov 10, 1:56 PM
    • 156 Posts
    • 290 Thanks
    crux
    • #8
    • 5th Nov 10, 1:56 PM
    • #8
    • 5th Nov 10, 1:56 PM
    Great thread.

    I'm 38 as of yesterday and have started thinking about retirement quite recently.

    It looks as though were I to work until I'm 65 and all things go to plan, then I should have a comfortable retirement.

    However I'm keen to get out of full time employment earlier than age 65 and things don't always go to plan in the long term!

    But I'm not sure I want to be fully retired as early as say 55. There is only so much golf, travelling and hobbies I can stomach! Maybe I lack imagination but I suspect would get bored.

    Also the nightmare scenario is hitting 50 being made unemployed and not being able to get a job that covers the remaining retirement plan cost, being in effect made to retire before I'm ready.

    So strategy wise I'm thinking about starting a 5-9 type business venture with potential to grow if needed.

    My thinking is that a part time business on top of my full time employment will both increase my income now (bringing early retirement closer to reality) and be a potential hedge against future unexpected unemployment, as well as keeping me busy and interested in the world outside my window when I do retire.

    Other than that I'm finally tracking all expenditure in detailed personal accounts, because I agree with LM that understanding what you spend is a big key to the whole retirement plan.
    We make our habits, then our habits make us
    • Loughton Monkey
    • By Loughton Monkey 5th Nov 10, 2:45 PM
    • 8,706 Posts
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    Loughton Monkey
    • #9
    • 5th Nov 10, 2:45 PM
    • #9
    • 5th Nov 10, 2:45 PM
    I should mention I was 46 last week and looking to retire before 55 (earlier if the sums add up)

    Ok, I am getting the strong message so far that focus in the first instance. I have a figure in my head which could be wildly wrong. I think the comment about not spending (and saving the balance) is very appropriate i.e. at the moment we really do not track spending very closely (as we do not have to) and therefore we simply save what is left.
    Originally posted by Marine_life
    Yes, this is reality. That's why concentrating on spending is the key. By definition, I class Income less spending as "saved" even if it lounges in a zero interest current account. How to do better is a totally different (but valid) debate.

    I plan to split my current spending into 4 buckets:

    1. Expenditure that I expect to fall away (school fees! Mortgage interest hopefully)
    2. Money going into saving at the moment.
    3. Day-to-day expenditure.
    4. Discretionary spend (cars, holidays, capital goods etc).

    I suspect I will be left with a gap which I think will be money that "leaks" away i.e. I can't account for it - Clearly if I start imposing some discipline I am to get much clearer on that.
    Originally posted by Marine_life
    It strikes me that this is your 'achilles heel'. Spending patterns change dramatically throughout life. Huge mortgage interest in early years. Child costs. Wild entertaining.... Everyone is different. Being able to account for every penny throughout your life helps very much to establish the underlying 'cost of your lifestyle'. Within there somewhere is the true 'cost' of what you will do when you retire.

    I would be interested to hear from some of the posters on category 4. I am guessing we would be able to manage with one car but that might be balanced by increased spending on holidays.?
    Originally posted by Marine_life
    These items can be difficult. Regarding the car, I 'depreciate' mine. In other words, my 'spending' includes car depreciation. This is a nominal account which is negative whenever I add up my net wealth. So the minute I buy a new car, it is totally neutral to my net wealth. Within my retirement budget, I allocate a fixed amount to "one-off". This year, we blew it on refurbishing the bathroom. Last year it was the Utility room. Prior to that we had an excellent holiday in Bali. Next year, we plan another exotic holiday, on top of our normal 8 weeks.

    The other big question will be where do we live. We have some equity in our home but also a big mortgage. We also own a holiday apartment. If we sold the two we might end up with around 300,000 net which would probably be enough to buy a decent property (although not as big as our current house)
    Originally posted by Marine_life
    Basically... er... your problem!

    Oh.....and of course I did not forget the non-financial category - what do you do with the spare time you have available now?
    Originally posted by Marine_life
    Ha! The $64,000 question. The absense of 'work/career stress' is an amazing relief and keeps me 100% happy. Basically, you need to decide what you want to do. I have a long holiday. Subject to weather, I sit by our pool and consume a very large number of large Gin & Tonics. In the winter, I find genealogy an extremely interesting topic that could consume your time full time if you allowed it.
    • Linton
    • By Linton 5th Nov 10, 3:18 PM
    • 10,728 Posts
    • 11,099 Thanks
    Linton
    Linton

    Thanks - very interesting.

    Makes me realise that really have got a lot of work to do. The main problem for me (us) is that I really have no idea what our current expenditure is. Of course I know what the big chunks are (House, Car etc) but have not been tracking how much we spend on (for example) food. I think for day to day items we are quite frugal, don't eat out a lot, don't spend a lot on lunches (I make my own) but the money goes on big things and house maintenance.

    You mention an increase in expenses of 10% (if I understood that right). Was that to cover the increasing cost of just "being"? Did you not have any savings on things like travel costs? How accurate was your 10% estimate?

    I assume you have a pension which funds your day-to-day expenses ?

    I have a million other questions but I will keep it light for now.
    Originally posted by Marine_life

    The 10% increase in budget was to cover the increased time for pleasures. "Being" is a bit cheaper after retirement but then I wanted more than that for the next 30 years.

    One thing to note is that I have a relatively large budget but I regard that as a limit, never to be exceeded.

    Currently I have taken one of my pensions which covers 20% of the budget, the rest is from savings. The main pensions will come in at 65.
    • Linton
    • By Linton 5th Nov 10, 3:23 PM
    • 10,728 Posts
    • 11,099 Thanks
    Linton
    .......
    I plan to split my current spending into 4 buckets:

    1. Expenditure that I expect to fall away (school fees! Mortgage interest hopefully)
    2. Money going into saving at the moment.
    3. Day-to-day expenditure.
    4. Discretionary spend (cars, holidays, capital goods etc).

    I suspect I will be left with a gap which I think will be money that "leaks" away i.e. I can't account for it - Clearly if I start imposing some discipline I am to get much clearer on that.

    I would be interested to hear from some of the posters on category 4. I am guessing we would be able to manage with one car but that might be balanced by increased spending on holidays.

    The other big question will be where do we live. We have some equity in our home but also a big mortgage. We also own a holiday apartment. If we sold the two we might end up with around 300,000 net which would probably be enough to buy a decent property (although not as big as our current house)

    Oh.....and of course I did not forget the non-financial category - what do you do with the spare time you have available now?
    Originally posted by Marine_life
    I didnt worry about the details of expenditure. All I needed to know was how much I was spending a year and whether I was happy with our standard of living.

    Spare time - spend as much time as possible on the canal boat.
    • Marine_life
    • By Marine_life 13th Nov 10, 9:26 PM
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    Marine_life
    ok, a while since my last post on RFW but I thought I would give a progress update.

    My OH has started to maintain records of how much we are spending. We will look at it over the next few months to see where we are. The main excess seems to be food shopping where we are spending somewhere around 20 per day (no junk food but I am wondering where it is going).

    Next - we have been looking at the cash we have saved which looks like around 700,000. I know it sounds a lot but I am aiming for retirement in around 5 years so that cash would need to last the rest of my life! I am hoping we can add another 3-400,000 to that over the next three years but we will have to really cut back if we are going to hit that figure. I am confident that if we can get to 1 m with no mortgage then I can retire at 50.

    3 years 11 months to go!
    Last edited by Marine_life; 13-11-2010 at 9:29 PM.
  • lilac_lady
    Good luck Marine_life. Even though I don't have an income like you hope yours will be (far from it!), retirement is wonderful!

    IMO opinion if you have no debt, no mortgage and some safety net savings, retirement could be an option for lots of people.
    " The greatest wealth is to live content with little."

    Plato


    • Gatser
    • By Gatser 14th Nov 10, 12:02 AM
    • 588 Posts
    • 220 Thanks
    Gatser
    Yes, Good Luck Marine Life
    ...and very interesting/useful thread.

    I started THE NUMBER thread because, as Loughton Monkey states, it is EXPENDITURE that is the key to a well planned retirement at any age...
    knowing what you need/want to spend is crucial in trying to work out how much you need to save in pensions/investments.
    The majority of people miss this point. (but not on here!)

    We use one credit card to purchase all Food/Fuel(petrol)
    so its easy to keep track of expenditure on those items
    (and we get cashback too )

    The non-financial aspects are equally interesting to discuss.
    We have a growing number of friends that have semi-retired and
    (as mentioned on here) are finding the reduced stress factor alone is a major positive of early (semi) retirement.
    Working 3 days a week is so much more relaxed than the usual 5-2 routine.

    Personally, I want a mix of activities in retirement and that includes "money generation"
    (but let's not call it working eh? )
    Income of around 12k is my aim, to top up pension/savings income.
    Target age: from 55.

    Great experience last year following sudden "redundancy" ... made me realise the true value of more free time
    and opportunities to enjoy it (while we are fit & healthy).
    Needed F/T job to continue pension saving... but it confirmed that early semi-retirement
    is just what I want. (although not sure OH wants me around all those extra hours! )

    Places are quieter and more relaxed Monday-Friday 9-5 too!
    THE NUMBER is how much you need to live comfortably: very IMPORTANT as part 1 of Retirement Planning. (Average response to my thread is 26k pa)
    My Other NUMBER: ZERO Working Days to SEMI-retirement: Achieved!
    • lvader
    • By lvader 14th Nov 10, 3:46 PM
    • 1,887 Posts
    • 1,601 Thanks
    lvader
    Great thread.

    I'm also looking to retire early. I used to earn a lot of money and would spend it all on unimportant things. Then 2 years ago (age 43) I got made redundant and my outlook has completely changed.

    I had to take part-time work and while I enjoyed the extra free time I was always under pressure to find another highly paid full time job. 18 months later I'm back in full time emplyment but had to take a 25% pay cut compared to before.

    I have cut my expenses by around 50% and I'm much more careful with my money. My plan is to be in a position to retire by the time I'm 55. I've made a decent start with my pension but I still have a long way to go,I figure if I make a real effort over the next 10 years I should be fine.
    • Marine_life
    • By Marine_life 14th Nov 10, 9:07 PM
    • 985 Posts
    • 1,913 Thanks
    Marine_life
    Gatsa

    That's a good idea about using a single card for petrol. That happens anyway as i have a fue card and actually only pay petrol once a year (company car).

    In this thread I am going to call wasting money "leaking" as that is what seems to happen - it just leaks away.

    One of this years biggest leaks has been holidays - as a family of four holidays are very expensive. I hate to skimp on holidays as I have a stressful job so last thing I was is a stressful holiday. Anyway this year we did three holidays one of which was Thailand which was very expensive.

    As we move towards retirement I actually think we may want to travel less or at least travel more within Europe which I think will materially reduce outgoings. I have been very fortunate to travel a lot with work and whilst that mainly involves seeing the airport and a hotel room - we have in between seen quite a lot such that I don't really feel the need to roam anymore.

    So whilst holidays will stay an important part of my retirement plan, the spend will be significantly reduced.

    Just thinking on that - is it still fair to call a holiday a holiday in retirement?
    • Loughton Monkey
    • By Loughton Monkey 14th Nov 10, 10:26 PM
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    Loughton Monkey
    So whilst holidays will stay an important part of my retirement plan, the spend will be significantly reduced.

    Just thinking on that - is it still fair to call a holiday a holiday in retirement?
    Originally posted by Marine_life
    Unlike financial matters, this question strays into the territory of personal choice.

    I notice that people are different. For a start, there are many people who genuinely say they will 'never' retire. I think they just love their job so much. Not necessarily the money. Then there are others, I notice who have to be 'wheeling and dealing' - again, not necessarily for the money, but it is a personal trait.

    Personally, I worked extremely hard over my 34 years. You can count the number of days off ill on one hand. Literally. I was even back at work in the afternoon of a kidney stone operation in the morning. Because of all this, my own aspiration on retiring was simply that. Retire. Forget the stress.

    Throughout my working life I always insisted on three weeks holiday at once. Often resisted, but I always made it. Two weeks was never enough for me in my annual attempt to 'switch off and recharge'.

    Our current strategy/practice is to hitch up the trailer full of camping equipment (luxury tent, plus small one for overnights) and clear off somewhere for 8 weeks mid May to mid July, aiming to get home before the 'masses' of kids get on holiday and pollute the place. [Spain, Portugal, France, Italy etc.] Then July/Sept is devoted to lounging by our pool in the British Sun. Guess which part of that often doesn't happen!!!!

    [Being away more than 60 days invalidates home insurance!!]

    The rest of the time, at least for me, is fully used. Managing my financial affiars can be reasonbly time consuming. It's also usual to have one or two hobbies. Playing Bridge perhaps, or (like me) tracing your family tree can be very rewarding and time consuming. I often go to the BBC and watch recordings. I get hauled out by my wife for walks in Epping Forest and elsewhere.

    My retirement budget also includes an annual luxury spend, and we tend to use that either for a refurbishment job in the house, or a winter holiday in Asia. [Trying to manage the budget and make 'extra' savings for extra luxuries is also fun!].

    In 5 years, I have not regretted retiring even for a minute. Nor have I ever got out of bed 'wondering' what to do today. The only decision I have to make, of any substance, is when the sun has gone down over the yardarm each day so that I can enjoy a very large Gin & Tonic or two. Luckily, my 'yardarm' is fully adjustable!
    • firesidemaid
    • By firesidemaid 14th Nov 10, 10:26 PM
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    firesidemaid
    i started my 'semi-retirement plan' about 2.5 years ago, which consists of a few stages:

    1) overpay on mortgage big-time to pay off asap (since helped by very low rates).

    started small ebay business to also assist with this. hopefully paying it off completely will co-incide with

    2) leave high-pressure job (in 2.5/3 years by choice if not before due to new government changes) with 24 years pension (to be claimed at 55-60 years).

    3) do same job at lower grade (and less hours), but same money as a temp worker to keep saving for a few years

    4) eventually just work locally doing a part-time job plus up the ebay side of things to constitute a combined income.

    i am in my early 40s now. we can downsize in the future. after paying off the mortgage (offset). we need to put the same money into savings, which is what we are currently lacking.

    the uncertainty lies for me with a what age will i get/be able to get my work and state pensions - as they keep moving the goalposts.

    with no mortgage, i think we would happily live on very little - no dependents. i worry about having enough for new cars when required and major house maintenance.

    my plans are very low-tech and basic, maybe naive even. my occupationalpension when i get it would be the equivalent today of approx 11-1200 per month.
    Last edited by firesidemaid; 15-11-2010 at 6:48 PM.
    • GillM
    • By GillM 15th Nov 10, 12:59 AM
    • 181 Posts
    • 207 Thanks
    GillM
    I retired on 31 July 2010 aged 53. I won't get my occupational pension until 60 and state pension until 66 but I actually took voluntary redundancy so with that payout (just over a years salary but only taxed on the amount over 30,000) and my savings I'm confident that I can support myself until 60 and hope to be able to live on my pension (final salary scheme with 37 years service) without dipping further into my savings on a day-to-day basis. The lump sum payment I will get will cover about half of what I'll have spent of my savings up to then.

    I only decided about 12 months ago that I was going to retire, although I'd always hoped to retire before 60. I had AVCs for about 16 years and for most of my working life have saved between half and a third of my income, so my savings are quite high plus the drop in income is relatively lower when you save such a high proportion. Also I paid off my mortgage about 3 years ago so that helps.

    At the moment I have no plans to look for any kind of work, but then it's only been 4 months yet so who knows how I'll feel in a year's time. In any case, I would not work for the money but for something that would interest me. I'd probably start out volunteering.

    I decided to retire early because I was off sick with stress for 4 months in 2008/09 (before that the longest I'd ever been off sick was 3 weeks following cataract surgery, and before that, only the odd day for colds, bad toothache etc). It was hard going back to work, and the stress actually increased rather than decreasing and I just knew that if I continued working much longer I'd be off sick again, which I didn't want.

    I keep thinking I've done my sums wrong, because it's hard to believe I could afford to give up work at my age, especially with no particular forward planning, but so far it's fine. Hope your plans work out.
    • Gatser
    • By Gatser 15th Nov 10, 12:15 PM
    • 588 Posts
    • 220 Thanks
    Gatser
    I decided to retire early because I was off sick with stress for 4 months in 2008/09

    I keep thinking I've done my sums wrong, because it's hard to believe I could afford to give up work at my age, especially with no particular forward planning, but so far it's fine. Hope your plans work out.
    Originally posted by GillM
    Good points!

    Ex colleague of mine died last month, aged 56
    We always need reminding of our mortality.

    It's amazing how many folks just keeping working when they could afford to (at least) semi-retire. ....and just think of how many jobs it would create for the under 25's who really do need a job.
    THE NUMBER is how much you need to live comfortably: very IMPORTANT as part 1 of Retirement Planning. (Average response to my thread is 26k pa)
    My Other NUMBER: ZERO Working Days to SEMI-retirement: Achieved!
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