Everyday Ordinary Man Approaching Full Retirement at 59.

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  • System
    System Posts: 178,077
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    Hi Salfordkid
    Many thanks for your interesting contribution to the thread. Great to hear from someone renting in Cyprus. I always feel so relaxed and happy when there. I prefer to stay in the Coral Bay/Peyia areas. Long-term rental as far as my research tells me is so much cheaper than paying for short-term holiday villa lets. I regularly find 3 bedroom villas with a pool available long-term for about £700 to £800 per month which is great value. For Cyprus holidays I have often paid double that for a week! Although of course up to now I have had to pay school holiday rates!
    Would be great to hear about your experience of renting in Cyprus and the cost of living. Do your pensions or savings cover all living expenses? Any idea if your plans could be altered by brexit? Did you ever consider buying an apartment outright with a communal pool? Some of the developments in my favourite area are really lovely with prices ranging just £45000 to about £100000. Some great townhouses can be bought for prices in that range too.
    I guess I have been spoilt by renting good quality villas for a couple of weeks or so with their own pool. I certainly couldn't afford to buy one of those. However a long-term rental, maybe next year, to see how I really feel about spending part of every year there is very viable. Great value too, especially if other members of the family go to stay and share costs.
    I hope by retiring early your health has been less of a worry. How were you both able to claim pensions so early?
    Again many thanks for your valuable contribution. Keep the news about Cyprus coming.
  • System
    System Posts: 178,077
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    edited 29 March 2017 at 4:32PM
    General recent news.
    I have recently joined a local website that connects tutors with students on a one to one basis. I have said I will be available from October 2017. It is not an agency but a way of connecting people for only a small fee per hour worked. I can choose when I work, set my fee and how far I want to travel. At rates of £25 to £30 an hour it will be a useful top up. Had to spend £52 updating my DBS check via my current employer and have joined the government's automatic update scheme to avoid future hassles. This costs £13 a year.


    Just another 31 working days for me between now and June 30th.
    Gives me a very positive feeling. Then I really do have the choice about what to do and when! Not ruling anything out.
    New tax year approaching and soon time to re-allocate funds to improve returns as previously stated.
    All the big annual bills for 2017 now paid. 4 more months of serious saving too!
    Hope you are all well. :)
  • System
    System Posts: 178,077
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    Salfordkid was your wife offered a non-reduced pension as the result of her redundancy? Just wondered as you say she has a good pension. Are you 65 next year then as you say you able to collect your state pension in a year's time. Just if you were 51 in 2005 that would make you only 63 now. Just being curious!


    Did you top up your NI over the years to improve your state pension? I will certainly do this over the next 7 years to ensure I get the new full pension after many years of being contracted out.
    I have calculated that I would pay an extra £5117 to gain an extra £31.15 a week index linked (at the moment) for life. Great value. In profit before 4 years are up!
  • bugslet
    bugslet Posts: 6,874 Forumite
    excelpaul wrote: »


    Just another 31 working days for me between now and June 30th.
    Gives me a very positive feeling.
    soon time to re-allocate funs to improve returns. :)

    Excellent typo, we all need to re-allocate our funs and get more of a return on them:D:D:D

    bet those 31 days seem sweet.

    @Salfordkid, as I am in Salford right this minute, I suspect you really are better off in sunny Cyprus.
  • System
    System Posts: 178,077
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    Dear all
    Everything always seem so much better when the sun is shining!
    Spent the first of my two days off this week gardening and walking the dogs. Now just chilling!
    Tomorrow begins the new tax year. I will transfer some money into my Stocks and Shares ISA and top up my cash ISA just a little. Trying hard to save a little more money before June 30th.
    Just 27 more working days to go before the end of June too!
    As you know have signed up with a tutor company but have said I am not available until October 2017.
    Going to enjoy three months of chilling, sorting and gardening before then. Been thinking about a trip to Cyprus but nothing finalised yet.
    Work on the new drive begins on May 2nd.
    Feeling positive right now!


    Take care
    Excelpaul
  • dunroving
    dunroving Posts: 1,881
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    I have found this whole thread very interesting and reassuring. It also seems more personally relevant to me than many other pensions/investment threads. I am also in education and can identify with the need to "go early" - much is said about how manual workers will never be able to work up to the new retirement age, but I think teachers also should be added to that list! I have summarised my situation below. Exact figures not included because I am still working them out!

    Qualified as a teacher in the late 1970s and struggled to get permanent work (three temporary contracts in three years), so went teaching overseas (not pensionable work). As I also (stupidly!) requested to withdraw my 3 years of UK teachers' pension as cash, I didn't pay into any occupational pension at all during my 10 years of school teaching.

    Bought a house in the UK during this time and spent a year overseeing its renovation from 3,000 miles away. Luckily sold it before the big crash of the early 1990s, but only made back what I had paid into it. The next 6 years was spent using savings and the house sale proceeds to study for a masters and PhD (including working part-time the whole time, to support my funds).

    So, I restarted my career in 1996 as a university lecturer, with a zero bank balance and a car loan. Paid into a defined contribution pension scheme for 10 years, in the US (which is currently worth about £80k). During this time, essentially made no money from house ownership as house prices in the area I was living did not go up for 10 years.

    In fact during this 10 years I bought a UK rental property, which eventually lost me about £20k due to awful tenants and the poor housing market where I bought the house (I know, sounds like I am bad at financial planning, but more a case of bad luck and bad timing than bad judgement).

    Restarted my career in the UK in 2006, and also bought a UK house for £180k at that time. From then until now I have thrown about every spare penny into my defined benefit occupational pension, including purchasing some additional years, into occupational money-purchase AVCs, and into unit-trusts housed within a SIPP and ISA. I have also started pulling cash withdrawals from my US pension to bring it over here while the $$ is strong. This is being put into the SIPP or ISA, or used for living expenses (as most of my salary is being put into occupational pension AVCs).

    I plan to go part-time for one year and take early retirement at age 61 (in 2018), subject to my employer's approval. At that point I will draw my occupational pension, and convert the usual lump sum into pension at a commutation rate of about 1/20th (£1,000 pension p.a. for each £10,000 cash). Luckily, my employer's MPAVC scheme is linked to the defined-benefit scheme so all the MPAVC cash will be taken tax-free as it is approximately 25% of my total pension value.

    The SIPP and ISA investments will stay put and fund me through retirement as needed.

    The main messages I take from all of this are:

    You can start investing late in life and still have enough to retire early. I essentially started at age 40, with no house and no savings.

    Don't assume that property is a sure bet! A house is something to live in, not make money from.

    You can figure out your own investment strategy, using basic principles (diversify, use low-cost investment platforms, buy when others are selling, and don't get greedy!)

    Planning for retirement is more than just finances. You have to think about quality of life, and what you will do when you take the final jump. Like others on this thread, i'd love to do some part-time work - I still have valuable skills.

    At some point you have to have trust and make the jump. Like others, I panic a bit about the fact that I will stop earning and the bank balance will start to go down, until state pension kicks in 6 years later.

    - I could write a lot more but feel like this post is already a bit long so maybe will come back and add more later!
    (Nearly) dunroving
  • System
    System Posts: 178,077
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    dunroving
    Many thanks for your excellent and informative post. Looking forward to reading more.
    Always reassuring to hear from others in a similar position making exciting and reasonable plans.
    I agree that some of the threads on other sections of this forum can be disheartening.
    Totally agree that quality of life as well as enjoying your time and relationships to the full are the most important things to consider than straight forward accumulation of wealth. Likewise a house should be a home.
    Thanks again!
  • bournefree
    bournefree Posts: 118 Forumite
    Hello excelpaul and dunroving. I've spent the morning looking at my finances because I have applied for voluntary severance in the final salary TPS and should hear in the next week or so if it has been accepted. I have applied to go in July 2018 when I'll be 59.5 and because that way I will get the maximum £30K tax free lump sum for severance. (I thought it would be easier that way than saving £1500 for 20 months, in what is now a precarious job situation and one in which I'm tired of the relentless pressure.) After what will be 36 years in teaching, my deferred unreduced lump sum at 60 should be £77,664 and deferred unreduced pension £25,888.

    This has come into sharper focus than expected, as my other half is just about to leave his job due to burnout, so saving anything in the foreseeable future will be very difficult unless he gets a new job fairly quickly (I had planned to save £1,500 pm to cover the 6 month period before I can claim my teacher's pension, so as to not eat into the £30K). Like him, I think I'll need to get another job in due course. I'd planned on doing something much less demanding for a while, a job you can't take home with you, perhaps on a part-time basis, to bring in a little money.

    Some colleagues work until their late 60s - I guess that's fine if that's what they want to do, but I am more negative, thinking that my 60s will be a decent decade, before decline in my 70s. I've seen too many have heart attacks straight after retiring, whilst others who went at 60 say it's the best thing they did.
  • System
    System Posts: 178,077
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    Bournefree
    Many thanks for your interesting post. Are you sure you will need to work? With your very decent lump sum and redundancy pay you would appear to be very well placed. Your pension will also be several thousand more than mine. I also will have taught for 36 years but took part of my pension at 55 when I entered and the rest at 58. I also maximised my lump sum to ensure all debt was paid off. I have no inheritances ahead so it will be all down to me. I am currently paying to TPS again during my part-time fixed term contract and I am also investigating a pension transfer from the LGPS that I gained when doing dinner duties! At 65 it will be £51 a year and a £131 lump sum! Hopefully the transfer sum may help me make better use of the.
    I am sure you will be fine. I wish you well with all your plans.
  • bournefree
    bournefree Posts: 118 Forumite
    Thanks excelpaul. Like you, I have no inheritances to come now so it's down to me to make sure I'm financially secure. Having got married a few years ago, than now includes supporting my other half. I don't intend converting part of my pension into a higher lump sum. I read what you put about beaches in Cyprus by the way - one day soon we won't have to go in school holiday periods!
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