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  • FIRST POST
    • Marine_life
    • By Marine_life 5th Nov 10, 10:46 AM
    • 888Posts
    • 1,601Thanks
    Marine_life
    Early-retirement wannabe
    • #1
    • 5th Nov 10, 10:46 AM
    Early-retirement wannabe 5th Nov 10 at 10:46 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 217
  • jamesd
    There's no need to drag FAs into the discussion
    Originally posted by kidmugsy
    For the British Steel case we do because without advisers suggesting grossly inappropriate investments it's easy to see that transferring is likely to make someone substantially better off.

    It's clear from some of the coverage that instead of normal investments and well established drawdown approaches advisers who might best be described as sharks or perhaps even crooks have been chasing after the money.

    The US study you linked to was interesting, given that in the UK it's typically irrational to buy an annuity at normal pension pot sizes and retirement ages.* Even for someone who does want a guaranteed income. State pension deferral for guaranteed, drawdown to handle drop over time, tend to outcompete until life expectancy is sufficiently reduced to help the annuities.

    *A few tens of thousands and insufficient other money to retire until state pension age or close to it.
    Last edited by jamesd; 02-07-2018 at 10:08 PM.
    • JoeEngland
    • By JoeEngland 2nd Jul 18, 7:38 PM
    • 75 Posts
    • 79 Thanks
    JoeEngland
    For the British Steel case we do because without advisers suggesting grossly inappropriate investments its easy to see that transferring is likely to make someone substantially better off.

    It's clear from some of the coverage that instead of normal investments and well established drawdown approaches advisers who might best be described as sharks or perhaps even crooks have been chasing after the money.

    The US study you linked to was interesting, given that in the UK it's typically irrational to buy an annuity at normal pension pot sizes and retirement ages.* Even for someone who does want a guaranteed income. State pension deferral for guaranteed, drawdown to handle drop over time, tend to outcompete until life expectancy is sufficiently reduced to help the annuities.

    *A few tens of thousands and insufficient other money to retire until state pension age or close to it.
    Originally posted by jamesd
    Speaking of annuities, it's only because of the pension freedoms introduced a few years ago that I can contemplate retiring early. With a annuities I'd need to work till at least 60 to then get by until SP. For that I'm grateful that a govt finally let people take responsibility for their own affairs.
  • jamesd
    Speaking of annuities, it's only because of the pension freedoms introduced a few years ago that I can contemplate retiring early. With a annuities I'd need to work till at least 60 to then get by until SP. For that I'm grateful that a govt finally let people take responsibility for their own affairs.
    Originally posted by JoeEngland
    I'm grateful that I was a respondent to the survey that preceded them. I was able to explain how the GAD limit was low early on when it needed to be high and say that if they wanted me to increase pension contributions they should stop forcing me to use non-pension money to get a level income throughout retirement. They delivered, though I'll never know how much of a role that feedback played.
    • chiefie
    • By chiefie 2nd Jul 18, 10:22 PM
    • 334 Posts
    • 340 Thanks
    chiefie
    The one piece of government legislation that I actually directly benefit from massively as I can stop work earlier than planned. Thank you o GO
    • gadgetmind
    • By gadgetmind 3rd Jul 18, 8:02 AM
    • 10,827 Posts
    • 8,719 Thanks
    gadgetmind
    Yes, we expected some loosening of the GAD rules (which had ironically just become more draconian) or changes to what qualified for uncapped drawdown, but what we got was utterly wonderful.
    I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.

    Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.
    • chucknorris
    • By chucknorris 3rd Jul 18, 12:53 PM
    • 9,638 Posts
    • 14,419 Thanks
    chucknorris

    At no point did I consider myself in competition with fellow students; the challenge was to reach a benchmark I set myself.

    Regimens, schedules and competition in retirement? Not me guv. Sounds far too much like a description of my working life.
    Originally posted by DairyQueen
    You make being in competition sound like a bad thing, maybe it is for you (we are all different), but I relish competition. Not just to help motivate me to achieve my benchmarks, but also for the competition itself. I have total respect (usually) for my opponents, if it wasn't for them I wouldn't be enjoying the competition that they are providing.

    I actually like my work too, although I handed in my notice in to retire 2 years ago, my employer asked me to stay on and work one day per week, which I consider much better than retirement.

    I ran my first Parkrun (5 km) last Saturday, after a year away from running from being injured (still got a couple of minor injuries, that reminds me I must update my signature soon), I didn't do a great time, 26.43, but I was satisfied for the first proper run in a year and on a hilly course. I couldn't have done that time without competing with others. I just got back from a 6 mile run (more of a fast jog) with my dog about an hour ago. I plan to increase my weekly 'long run' by a mile a month until I get up to the half marathon distance (unless any old injuries reappear).
    Last edited by chucknorris; 03-07-2018 at 1:05 PM.
    Chuck Norris can kill two stones with one bird
    The only time Chuck Norris was wrong was when he thought he had made a mistake
    Chuck Norris puts the "laughter" in "manslaughter".
    After running injuries I now mostly hike, gym classes and weight training (also a bit of cycling and swimming), less impact on my joints.
    • Triumph13
    • By Triumph13 3rd Jul 18, 1:33 PM
    • 1,238 Posts
    • 1,562 Thanks
    Triumph13
    Not saying that you are like this chucknorris, but there seem to be many highly competitive people who don't really seem to grasp that not everyone is like them. This wouldn't be a problem, were it not for the fact that it tends to be the competitive people who end up in charge and defining the culture that other people have to work in.
    I fully agree that an enterprise has to be competitive against it's external rivals, but within that context, many people thrive much better in a spirit of internal cooperation towards a joint goal than in a culture of cutthroat competition with their peers.
    • chucknorris
    • By chucknorris 3rd Jul 18, 1:39 PM
    • 9,638 Posts
    • 14,419 Thanks
    chucknorris
    Not saying that you are like this chucknorris, but there seem to be many highly competitive people who don't really seem to grasp that not everyone is like them. This wouldn't be a problem, were it not for the fact that it tends to be the competitive people who end up in charge and defining the culture that other people have to work in.
    I fully agree that an enterprise has to be competitive against it's external rivals, but within that context, many people thrive much better in a spirit of internal cooperation towards a joint goal than in a culture of cutthroat competition with their peers.
    Originally posted by Triumph13
    I acknowledge that you said, 'Not saying that you are like that, and I'm not like that, and I actually said so in my post:

    You make being in competition sound like a bad thing, maybe it is for you (we are all different), but I relish competition. Not just to help motivate me to achieve my benchmarks, but also for the competition itself. I have total respect (usually) for my opponents, if it wasn't for them I wouldn't be enjoying the competition that they are providing.
    Originally posted by chucknorris
    I believe in healthy competition, not cut throat competition, even when I lose, I get something out of it, even if it is only motivation to try/train harder, but sometimes it is more than that, i.e. I might have learned something. So for me competition isn't just about winning. In fact, I think that I have probably learned more in defeat/failure than in success/winning.

    EDIT: Actually a lot of the time when I am being competitive, it is only with myself, like this morning seeing how quickly I could run 6 miles (Ok my dog was there too, but I can tell you now, there is no way I could win a race against him), and I am just about to try and do 10 reps bench pressing the weight that I have so far only achieved 9 reps with, I don't think I'll do it today, but I am confident that I will do it soon.
    Last edited by chucknorris; 03-07-2018 at 1:57 PM.
    Chuck Norris can kill two stones with one bird
    The only time Chuck Norris was wrong was when he thought he had made a mistake
    Chuck Norris puts the "laughter" in "manslaughter".
    After running injuries I now mostly hike, gym classes and weight training (also a bit of cycling and swimming), less impact on my joints.
    • Sipowicz
    • By Sipowicz 3rd Jul 18, 1:56 PM
    • 52 Posts
    • 30 Thanks
    Sipowicz
    Chuck.......chill! ;-)
    • chucknorris
    • By chucknorris 3rd Jul 18, 2:32 PM
    • 9,638 Posts
    • 14,419 Thanks
    chucknorris
    Chuck.......chill! ;-)
    Originally posted by Sipowicz
    I am totally chilled lol. But I won't be tonight at 7 pm!
    Chuck Norris can kill two stones with one bird
    The only time Chuck Norris was wrong was when he thought he had made a mistake
    Chuck Norris puts the "laughter" in "manslaughter".
    After running injuries I now mostly hike, gym classes and weight training (also a bit of cycling and swimming), less impact on my joints.
    • gallygirl
    • By gallygirl 3rd Jul 18, 8:36 PM
    • 16,612 Posts
    • 109,707 Thanks
    gallygirl
    About ten years ago, a group of us on a different (womans) forum decided to get our 10,000 and more steps a day. We diligently measured our stride lengths ( before fitbits etc were popular) and I averaged it out to equate to x many steps= 1 mile, so collectively we could cover 50, for example, miles a day. The following day, I'd post about where we were, nice pictures, snippets of info, nothing too heavy as it was all very light hearted.

    We have covered many routes, round the coast of Britain, across Europe, east & west coast of the States, route 66, Oz and NZ, ( we have a Kiwi and a Yank), the odd pilgramige route, Argentina was enjoyable. Trouble is after all this time, we are running out of countries, so the mileage totting up has gone out of the window and we do things like visit World Heritage Sites. Currently we are doing the Silk Road and are in Baku, Azerbaijan.

    As I said, after all that time, we have morphed from a group of fat middle aged women into 20 year old bikini babes, with a penchant for alcohol and fast living, and occasional imprisonment. To explain how bizarre it has become, we have a virtual RV driven by someone that wanted to be a Stepsister, but doesn't like walking, so she drives the virtual RV. Though not over bridges. It really isn't serious and the daily quality is highly dependent on finding a place that is worth talking about. Desert areas, sheesh.

    You asked I hesitate to recommend anyone join us as it's bonkers really.
    Originally posted by bugslet

    Actually I think it sounds rather marvellous . You're keeping active and 'seeing' the world, no doubt learning as you and I'm sure some have followed up with real trips.

    I can recommend walking the Caminito del Rey in Spain if you want some attractive scenery, though you have to wear a hard hat (which clashes somewhat with the bikinis ) and the RV will have to wait in the car park .


    Oh, and great group name
    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"
    • JoeEngland
    • By JoeEngland 3rd Jul 18, 9:15 PM
    • 75 Posts
    • 79 Thanks
    JoeEngland
    I'm grateful that I was a respondent to the survey that preceded them. I was able to explain how the GAD limit was low early on when it needed to be high and say that if they wanted me to increase pension contributions they should stop forcing me to use non-pension money to get a level income throughout retirement. They delivered, though I'll never know how much of a role that feedback played.
    Originally posted by jamesd
    Big thanks in case your feedback played a role! It's refreshing that people are given personal responsibility instead of being treated like naughty children.
    • Marine_life
    • By Marine_life 5th Jul 18, 7:59 AM
    • 888 Posts
    • 1,601 Thanks
    Marine_life
    Back to blogging - hopefully now more regularly:

    http://earlyretirefree.com/how-much-do-i-need-for-retirement-and-will-it-last/
    Money won't buy you happiness....but I have rarely if ever been in a situation where more money made things worse!
    • JoeEngland
    • By JoeEngland 5th Jul 18, 8:30 PM
    • 75 Posts
    • 79 Thanks
    JoeEngland
    Originally posted by Marine_life
    If the 4% rule doesn't factor in SP then it's clearly a flawed number. My retirement plan is based on reducing drawdown on savings and DC pensions by the same amount as SP once I reach 67 and get paid SP.
    • bluenose1
    • By bluenose1 5th Jul 18, 9:46 PM
    • 1,985 Posts
    • 3,197 Thanks
    bluenose1
    My husband gets 20k Pension now and I will get 10k Pension at 60.
    We have about 10k income from properties
    We will have about 70k in a DC scheme in 3 years when I am 55.
    Assume the 4% rule doesn't apply to us. Not sure if there is a formula to use in my circumstances to decide when to retire.
    Money SPENDING Expert

    • gadgetmind
    • By gadgetmind 5th Jul 18, 10:22 PM
    • 10,827 Posts
    • 8,719 Thanks
    gadgetmind
    once I reach 67 and get paid SP.
    Originally posted by JoeEngland
    Assuming Brexit doesn't bankrupt HMG such that they means test state pension. "Saved some money up? Great, spend that first, and then try your luck again as there is no more money."

    I have 0 in my plan for state pension as anything else is blind optimism.
    I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.

    Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.
    • JoeEngland
    • By JoeEngland 5th Jul 18, 10:30 PM
    • 75 Posts
    • 79 Thanks
    JoeEngland
    Assuming Brexit doesn't bankrupt HMG such that they means test state pension. "Saved some money up? Great, spend that first, and then try your luck again as there is no more money."

    I have 0 in my plan for state pension as anything else is blind optimism.
    Originally posted by gadgetmind
    I'm not going to get into an argument about Brexit, but take your point. Besides, we don't know what could happen to SP in the future without Brexit, just as I don't know if I'll live to 67.
    • AnotherJoe
    • By AnotherJoe 6th Jul 18, 12:34 AM
    • 9,889 Posts
    • 11,047 Thanks
    AnotherJoe
    My husband gets 20k Pension now and I will get 10k Pension at 60.
    We have about 10k income from properties
    We will have about 70k in a DC scheme in 3 years when I am 55.
    Assume the 4% rule doesn't apply to us. Not sure if there is a formula to use in my circumstances to decide when to retire.
    Originally posted by bluenose1

    The 4% "rule" applies to any money you intend to draw down from an amount that you want to last indefinitely. In your case you likely would plan to run it down to "fill the gap between age 55 and your 10k DB pension aged 60 so you wont be using the 4% rule.



    The "formula" is not exactly brain surgery, just add your DB + SP plus whatever you think you need to burn down from your "pension pot" (which may include personal pension, ISAs and other savings) .



    A few lines in a spreadsheet or if thats too difficult, on a bit of paper. One line per year, showing the different amounts coming in
    eg

    aged 55 20k DB + 10k rent + say 10k from DC = 40k.
    aged 56 20k DB + 10k rent + say 10k from DC = 40k.
    aged 57 20k DB + 10k rent + say 10k from DC = 40k.
    aged 58 20k DB + 10k rent + say 10k from DC = 40k.
    aged 59 20k DB + 10k rent + say 10k from DC* = 40k.
    aged 60 20k DB + 10k rent + 10k DB =40k
    etc
    and at age 67
    aged 67 20k DB + 10k rent + 10k DB + SP1 ?8k + SP2 ?8k = 56k

    Is 40k enough to live on aged 55? If so you can retire. If not, you cant. Or you can "semi retire" and take part time jobs. Add those into the numbers.

    *That leaves you 20k in DC as a fall back, eg 5 years at 10k out.
    • Marine_life
    • By Marine_life 6th Jul 18, 8:05 AM
    • 888 Posts
    • 1,601 Thanks
    Marine_life
    My husband gets 20k Pension now and I will get 10k Pension at 60.
    We have about 10k income from properties
    We will have about 70k in a DC scheme in 3 years when I am 55.
    Assume the 4% rule doesn't apply to us. Not sure if there is a formula to use in my circumstances to decide when to retire.
    Originally posted by bluenose1
    The 4% rule is aimed at those who are relying mainly on investments to meet their retirement needs and the uncertainty that entails.

    In your case if your pensions income is from defined benefit pensions that adjust with inflation then your calculation is more about understanding your expenses and whether your secure income sources meet those needs. Your DC pension pot will probably form only a small portion of your retirement income.
    Money won't buy you happiness....but I have rarely if ever been in a situation where more money made things worse!
    • OldMusicGuy
    • By OldMusicGuy 6th Jul 18, 9:23 AM
    • 449 Posts
    • 890 Thanks
    OldMusicGuy
    I personally wouldn't trust the 4% rule over a 30 year retirement based on what has happened in the past, because there are some pretty big societal and economic shifts looming. However, I think it's a really useful guide number to help get an idea of what size of DC pot you need to retire and I wish I'd known about it earlier.

    I'm using a bucket strategy in retirement rather than any form of safe withdrawal rate but that suits my very risk-averse nature. One of the most important things I have learned is to find both investment and decumulation strategies that suit your psychological makeup.
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