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  • FIRST POST
    • Gatser
    • By Gatser 14th Dec 09, 1:44 PM
    • 588Posts
    • 220Thanks
    Gatser
    Pensions Planning: The NUMBER
    • #1
    • 14th Dec 09, 1:44 PM
    Pensions Planning: The NUMBER 14th Dec 09 at 1:44 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 64
    • TBC15
    • By TBC15 3rd Aug 18, 4:49 PM
    • 675 Posts
    • 336 Thanks
    TBC15
    And there is the age the money tap turns off. Mr TBC15 we would like a word your account is looking progressively odd.
    • Northamptonblue
    • By Northamptonblue 5th Aug 18, 1:34 PM
    • 33 Posts
    • 73 Thanks
    Northamptonblue
    Apology
    Dairy Queen - clearly my desire not to offend has fallen on stony ground. I can only apologise for the offence so obviously caused and repeat that was never my intention.
    • DairyQueen
    • By DairyQueen 5th Aug 18, 9:34 PM
    • 585 Posts
    • 975 Thanks
    DairyQueen
    Dairy Queen - clearly my desire not to offend has fallen on stony ground. I can only apologise for the offence so obviously caused and repeat that was never my intention.
    Originally posted by Northamptonblue
    Any apology should be directed at the forum for your inappropriate hijacking of the thread. We all make mistakes and you dropped some clangers. I challenged you and then moved on. It's no big deal.

    I think you should close this off-base subject and allow the thread to regain its usual flow.

    On the upside...

    ... you can continue using 'nitty gritty' with a clear conscience.
    • PipPip
    • By PipPip 10th Aug 18, 8:55 AM
    • 125 Posts
    • 231 Thanks
    PipPip
    I just read a reply from myself to this thread in 2010 when I was a 39 year old just beginning to seriously increase my pension contributions. At the time I thought my wife and I needed 50k pa and I would retire at 60. My outlook has changed a little since then. I am now targeting retirement at 55, in 7 years time and have lowered my target income somewhat. I now feel that 35-40k will be sufficient based on current spending. In fact I see a few people reacted to my suggestion of 50k pa that it sounded like a lot in retirement with no mortgage etc. I agree!
    I believe we are on track for this income target. My wife has very little pension, only a 30k pot, and only puts about 5k pa into it. The result of spending the first 7 years of her working life in the Czech Republic earning buttons and 10 years not working raising kids. However, she has kept her NI record up to date and is projected to have a full state pension at 67. My projection also suggests a full state pension at aged 67, so 16k between us in state pensions. I have never been in a DB scheme but my DC pots add up to around 660k currently and I put in 40k pa so in 7 years this should be at about the LTA of 1m. ISAs and other savings add up to about 100k. We have a property in France on which the mortgage will be clear in 5 years that is worth around 250k now. It's a ski apartment so we will use it a lot in early years of retirement and sell it later on. The mortgage on our main home will still be about 100k in 7 years time but the property is worth about 700k. The plan is to sell and move to a cheaper property/area in 7 years time to allow the mortgage to be repaid. It's an expensive to run listed thatch cottage which is not the property we want to live in when we retire. Pretty bored of the corporate life now and I would retire before 55 if I could!
    • OldMusicGuy
    • By OldMusicGuy 10th Aug 18, 10:12 AM
    • 679 Posts
    • 1,428 Thanks
    OldMusicGuy
    Pretty bored of the corporate life now and I would retire before 55 if I could!
    Originally posted by PipPip
    That all sounds like a plan and I sympathise!
    • ams25
    • By ams25 10th Aug 18, 10:36 AM
    • 223 Posts
    • 297 Thanks
    ams25
    That all sounds like a plan and I sympathise!
    Originally posted by OldMusicGuy
    +1

    Actually your situation sounds very similar to mine when in my mid/late 40s...planned to exit a stressful corporate job at 55 ish, but through a combination of good markets, high saving and an exit package escaped a few years earlier. If circumstances are good for you its definitely possible. A lower expendiure rate is the key but do allow yourself the funds to fully enjoy your freedom (travel, hobbies etc)
    • blisteringblue
    • By blisteringblue 10th Aug 18, 11:01 AM
    • 1,080 Posts
    • 1,963 Thanks
    blisteringblue
    +1
    Originally posted by ams25
    +2

    Although luckily I am a little closer at 50

    I've just made the decision to work until the end of the Tax Year when I turn 55 too, so an extra 4 months, how will I cope

    1694 days to be exact
    • ex-pat scot
    • By ex-pat scot 10th Aug 18, 11:20 AM
    • 289 Posts
    • 355 Thanks
    ex-pat scot
    +2

    Although luckily I am a little closer at 50

    I've just made the decision to work until the end of the Tax Year when I turn 55 too, so an extra 4 months, how will I cope

    1694 days to be exact
    Originally posted by blisteringblue
    2080 approximately. Not that I am counting.
    69 pay packets.

    I'm not sure about the "exactly when" point. If there's a choice, and I have LTA headroom, then perhaps I should earn 11,850 + 40,000 in that last tax year, so I can use up my nil rate band and also get the full AA contributed as a last gesture of employment.
    That would take me 5 months into the tax year ie to end August. I might have to rethink that a little, depending on holiday plans!

    Other thoughts include:
    - doing a couple of months extra, and contributing all of that additional as charity (via sal sac) to get full tax relief. I figure that two months would get around 21,000 and would go a long way towards a guilt free retirement (better to have that as a significant gift, than doing little bits for charity here and there at much lower return to the charity)
    - bonus (if I stay with existing employer) would kick in at the October salary payment- maybe another 5,000 - 10,000 for the taking
    • lisyloo
    • By lisyloo 10th Aug 18, 11:26 AM
    • 22,876 Posts
    • 11,428 Thanks
    lisyloo
    doing a couple of months extra, and contributing all of that additional as charity (via sal sac) to get full tax relief. I figure that two months would get around 21,000 and would go a long way towards a guilt free retirement (better to have that as a significant gift, than doing little bits for charity here and there at much lower return to the charity)

    That is a fantastic idea.
    Consider it spread !
    • michaels
    • By michaels 10th Aug 18, 11:50 AM
    • 21,770 Posts
    • 101,314 Thanks
    michaels
    +2

    Although luckily I am a little closer at 50

    I've just made the decision to work until the end of the Tax Year when I turn 55 too, so an extra 4 months, how will I cope

    1694 days to be exact
    Originally posted by blisteringblue
    Nearly 2.5k for me unless fate intervenes
    Cool heads and compromise
    • michaels
    • By michaels 10th Aug 18, 11:56 AM
    • 21,770 Posts
    • 101,314 Thanks
    michaels
    I just read a reply from myself to this thread in 2010 when I was a 39 year old just beginning to seriously increase my pension contributions. At the time I thought my wife and I needed 50k pa and I would retire at 60. My outlook has changed a little since then. I am now targeting retirement at 55, in 7 years time and have lowered my target income somewhat. I now feel that 35-40k will be sufficient based on current spending. In fact I see a few people reacted to my suggestion of 50k pa that it sounded like a lot in retirement with no mortgage etc. I agree!
    I believe we are on track for this income target. My wife has very little pension, only a 30k pot, and only puts about 5k pa into it. The result of spending the first 7 years of her working life in the Czech Republic earning buttons and 10 years not working raising kids. However, she has kept her NI record up to date and is projected to have a full state pension at 67. My projection also suggests a full state pension at aged 67, so 16k between us in state pensions. I have never been in a DB scheme but my DC pots add up to around 660k currently and I put in 40k pa so in 7 years this should be at about the LTA of 1m. ISAs and other savings add up to about 100k. We have a property in France on which the mortgage will be clear in 5 years that is worth around 250k now. It's a ski apartment so we will use it a lot in early years of retirement and sell it later on. The mortgage on our main home will still be about 100k in 7 years time but the property is worth about 700k. The plan is to sell and move to a cheaper property/area in 7 years time to allow the mortgage to be repaid. It's an expensive to run listed thatch cottage which is not the property we want to live in when we retire. Pretty bored of the corporate life now and I would retire before 55 if I could!
    Originally posted by PipPip
    Wow you so sound like me and numbers are very similar (no nice French asset (isn't cgt a big issue for that?) for me but no mortgage either). Good to hear that you also anticipate a similar annual income at 55. How did you persuade the DW to go back to work?

    I think the current value of the SP is now closer to 8.5k?
    Cool heads and compromise
    • PipPip
    • By PipPip 10th Aug 18, 2:48 PM
    • 125 Posts
    • 231 Thanks
    PipPip
    I don't think we have CGT issues to worry about as the main gain on the French property has been due to exchange rates, not property value growth in Euros.


    I never persuaded my wife to return to work! She makes curtains, blinds and soft furnishings from home now. It's kind of a hobby business but she is extremely good at it and can bring in 10k-15k pa working just a few hours a day Monday to Friday. She doesn't really run it as a business as she does zero marketing but word of mouth means she always has a steady stream of work. Her profession was Marketing for big corporates but she can't face ever doing that again! She spends half her day running, cycling or swimming (she does triathlons at a decent level).


    If I can escape before 55 I will. A nice redundancy payoff in my early 50s would suit me well!


    Edit, especially as two of my former colleagues have died of cancer in the last 4 weeks aged 52 and 56 respectively. Life is too short!
    Last edited by PipPip; 10-08-2018 at 2:54 PM.
    • MallyGirl
    • By MallyGirl 10th Aug 18, 3:02 PM
    • 3,140 Posts
    • 8,184 Thanks
    MallyGirl
    She spends half her day running, cycling or swimming (she does triathlons at a decent level).

    If I can escape before 55 I will. A nice redundancy payoff in my early 50s would suit me well!

    Edit, especially as two of my former colleagues have died of cancer in the last 4 weeks aged 52 and 56 respectively. Life is too short!
    Originally posted by PipPip
    I don't think you can underestimate the huge benefits that having time to get/be healthy brings. It is something we struggle with at the moment, aged 51, but DD is just about to enter 6th form so in 2 years she'll be gone and parental taxi duties won't be clogging up our evenings and weekends. Driving lessons start in 6 months so freedom could be sooner than that. Till then its dog walking before work and at the weekend mainly, plus DH has joined a lido to swim.

    My boss had a heart attack at Easter - 2 weeks after his 40th birthday. That focused the mind somewhat

    A redundancy option would be welcomed here too.
    • lisyloo
    • By lisyloo 10th Aug 18, 3:09 PM
    • 22,876 Posts
    • 11,428 Thanks
    lisyloo
    I've had 3 colleagues die, 2 in their 40's one early 50's.
    As you say, focusses the mind.
    • Thrugelmir
    • By Thrugelmir 10th Aug 18, 3:20 PM
    • 61,360 Posts
    • 54,610 Thanks
    Thrugelmir
    I've had 3 colleagues die, 2 in their 40's one early 50's.
    As you say, focusses the mind.
    Originally posted by lisyloo
    We all live life hanging by a piece of thread. Enjoy each day for what it is and what it brings. Smile as doesn't cost a penny.
    Financial disasters happen when the last person who can remember what went wrong last time has left the building.
    • twotonealex
    • By twotonealex 10th Aug 18, 6:20 PM
    • 69 Posts
    • 25 Thanks
    twotonealex
    I just read a reply from myself to this thread in 2010 when I was a 39 year old just beginning to seriously increase my pension contributions. At the time I thought my wife and I needed 50k pa and I would retire at 60. My outlook has changed a little since then. I am now targeting retirement at 55, in 7 years time and have lowered my target income somewhat. I now feel that 35-40k will be sufficient based on current spending. In fact I see a few people reacted to my suggestion of 50k pa that it sounded like a lot in retirement with no mortgage etc. I agree!
    Originally posted by PipPip
    PipPip, your initial figure is interesting, I recently worked out 'the number', so I could figure out where we need to be for retirement. I'm 20 years younger than you, and the sums I did came to around 50K P.A between us.
    I'm aware 'the number' will most likely change as we go through our lives, and realign to something more like your amended amount of 35-40K PA, however only time will tell!

    I've recently joined the CS, and will have a DB pot of around 25K PA if I work till 55 (based on no payrises), and am working on a SIPP and other 'offline' investments to facilitate retiring 10 years before I can claim my DB pension at the reduced age of 65.

    If my partner also does the same, we should both be around the 50K figure in DB pension from 65, we just need to store up enough to bridge that 10 year gap!

    Thank you for your post, most interesting!
    • DT2001
    • By DT2001 9th Sep 18, 11:08 PM
    • 51 Posts
    • 22 Thanks
    DT2001
    How do you copy part of a post and put it into a box?

    Pip Pip I think you are aiming for too large a fund so could retire before 55. I followed a link on another thread to Kitces.com and ratcheting safe drawdown - gist is 4% pa return increasing by inflation is achievable. Your 1m would give 40k however you’ll get State Pensions later and property proceeds from France to boost your pots so could draw more early.

    I and the OH are aiming for early retirement being in partial retirement already waiting for children to finish education. I’ve rejigged figures with the knowledge like you that a ski apartment will be sold down the line to refill the coffers if necessary. The cash-flow forecast that we all need to do is an interesting exercise as other threads discuss the income levels needed/desired at various stages of retirement.
    I looked at getting more into OH’s pension so from 55 to SPA we can utilise personal allowances to the full, topped up by ISA income and minimised tax paid. A tough exercise as it involves quite a few guesstimates but it looks like present position is very healthy. Good luck.

    I like the idea of ‘the number’ (30k) but as a minimum to cover day to day expenses and some holidays. As we’ll rely more on investment income rather than fixed I like the concept of any surplus from the previous year being used for more/better holidays/entertainment.
    • sjp999
    • By sjp999 9th Sep 18, 11:25 PM
    • 107 Posts
    • 80 Thanks
    sjp999
    How do you copy part of a post
    Originally posted by DT2001
    Hit the orange speech bubble, you can edit the contents of the quoted text if fancy.
    • DT2001
    • By DT2001 10th Sep 18, 7:57 AM
    • 51 Posts
    • 22 Thanks
    DT2001
    Hit the orange speech bubble, you can edit the contents of the quoted text if fancy.
    Originally posted by sjp999
    Not sure if the bubble will appear when I add post however at the moment it just shows (quote) at both ends of copied text. Sorry bit of a technophobe!

    Thank you
    • DT2001
    • By DT2001 10th Sep 18, 7:58 AM
    • 51 Posts
    • 22 Thanks
    DT2001
    I can see that worked so many thanks and hopefully any of my future posts will be easier to follow.
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