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Planning for Retirement

Discussion in 'General Discussion' started by randomshenans, 4 Sep 2020.

  1. SaBBz

    Mobster

    Joined: 18 Oct 2002

    Posts: 2,822

    Location: Elsewhere

    Do you think your location helps with being able to retire early? I’m thinking about moving away from the UK when I come to retire.
     
  2. CaptainRAVE

    Man of Honour

    Joined: 21 Nov 2004

    Posts: 37,977

    I'll probably drop to part time in my 50s and retire shortly thereafter. No way am I working to official retirement age, I'll probably die shortly after. Screw that. I'll have enough money to get by, I'll just sell our London houses and move somewhere cheaper, possibly back in Wales where money goes so much further.
     
  3. GinG

    Soldato

    Joined: 22 Jul 2006

    Posts: 7,390

    My wife has been in the NHS since she was 21 and got to being ag a band 6 fairly early on so her average earnings for her pension have been decent so far.

    She is working part time now but she should still get a decent pension and payout.

    I joined the emergency services 3 years ago and up until then only had around £20k in a pension pot. I can't remember at what age my retirement is set at, either 55 or 60 but looking at the calculator I will get around £80k payout at around £12k per year.

    We have a mortgage which will be paid off by the age of around 55 (hopefully will reduce this) and I'd say the house is currently worth £300k.

    My parents home is valued at around £250k and this will eventually be split between my sister and I whenever the dreaded day comes.

    I feel we have a decent plan for now and plan on enjoying ourselves having bought a caravan last year making memories with our 2 girls.

    My wage will increase for a further 4 years and the wife is hopefully planning on being a nurse consultant so feel like we will have a good life and able to work towards a comfortable retirement.

    A lot can still happen in 20 years so things can change but retirement is deffinately something I'm not worrying about.
     
  4. GinG

    Soldato

    Joined: 22 Jul 2006

    Posts: 7,390

    I think you have it spot on.

    Having been off with Covid for 3 months almost I really missed the structure of going to work.

    I always thought that when I retire that will. Be it but I think being able to top up the pension whilst keeping a bit of structure in life but without the stresses is a very good option.
     
  5. dirtychinchilla

    Capodecina

    Joined: 2 May 2011

    Posts: 10,229

    Location: Woking, Surrey

    I'm curious how they shook up your finances if you wouldn't mind sharing?
     
  6. Martynt74

    Capodecina

    Joined: 20 Feb 2004

    Posts: 16,083

    Location: Higher Walton

    I think that's the dream retirement plan for anyone living in London!
     
  7. booyaka

    Capodecina

    Joined: 19 Jan 2006

    Posts: 13,630

    I can't speak directly for the poster in question but for someone in their mid 30's I'll give you my experience of this age bracket I see.

    "most" mid 30's/nearing 40 year old couples are as follows:
    • No pension/very little
    • Live for today - retirement is so far away
    • no wills in place
    • no life cover/very little
    • Any pensions they have have probably not been reviewed/touched since they were setup
    • Have little or no savings
    • Don't know much past the basics of pension/planning/retirement
    In most cases it's about education of what they should be doing more of - Saving, using pension/ISA for relief or reducing their tax bill. Spoke to a couple recently in their late 30's with 2 young kids who earned around £60k each, had no clue about life cover (they had none apart from x3 salary for him from his work), had no wills, have almost no pensions as they assumed the state pension would "probably" be enough. Mortgage on variable rate as they haven't had the time to look for a better rate.

    They have an accountant they use as they own 2 BTL properties, who's never spoke to them about pension tax relief/reducing their tax bill by paying into a pension. Both of them pay the bare minimum in via their work pension.

    A long discussion/education about what they should be considering, how they should be planning for the future. We set some goals for them, worked a financial plan out for them and within 6 months they are in a much better place.

    Financial advice/IFA etc shouldn't be about someone who picks funds for you, or transfers a pension....it should be about education, goals, aims and working together.

    It's all well and good to say I want to retire at 55/58/60 etc - but how many people have a plan in place or actually understand whether it's financially possible to retire at that age?
     
  8. SPG

    Soldato

    Joined: 28 Jul 2010

    Posts: 7,157

    I am going for retiring at 68 with a full state pension and my own private pension. One of the lucky ones who enjoys what they do.
     
  9. dirtychinchilla

    Capodecina

    Joined: 2 May 2011

    Posts: 10,229

    Location: Woking, Surrey

    Very interesting. Are you a financial advisor? I'm shocked that a couple in such a good financial position could have so little knowledge of finances.

    I'm 31 for reference. My wife and I both have active pensions, although in all fairness they aren't particularly healthy, but she now works for the council. I invested her previous pension into the Vanguard S&P tracker so that's earning a bit for us. We aren't living for today, but we also have short term financial goals that can obscure the long term ones (buying a new house, establishing emergency fund which has been wiped out in the house purchase). No need for a will as I see it - no children so my wife would get it all and vice versa. We both have life cover, which would pay off the mortgage at least - might need to up that if/when we move. I check our pensions every so often and they're performing well, though her new one I'm not sure about. Savings again will be wiped out in buying a house, but time will remedy that.

    I did try to take financial advice, but our lack of emergency fund meant we had no savings at that time so there was apparently no advice to give. I'd love to just be saving, though.
     
  10. Mr^B

    Mobster

    Joined: 25 Nov 2002

    Posts: 3,434

    My employer contributions are over £20k a year, that combined with the tax that I don't pay on my contributions means that, yes they are not the only investment people should make, but for 99% of people it must be at LEAST one of them.
     
  11. booyaka

    Capodecina

    Joined: 19 Jan 2006

    Posts: 13,630

    Absolutely - Gone are the days of a single job for 40 years and a pension/gold watch at the end.

    Now I see everything for retirement income - pension/ISA/ savings/BTL/company money drawdown/directors accounts/dividends to name but a few - It's all about what is the most tax efficient way of generating the income required
     
  12. martin363

    Hitman

    Joined: 18 Jan 2012

    Posts: 640

    Location: Ho Chi Minh, Vietnam

    Yes, but perhaps not in the way you mean. 1 year here is worth 3 years financially in the UK. That is what has enabled out position. That said we plan to live 9 month in Greece and 3 in the UK from the summer this year. The cost of living and quality of life in Greece are both better when compared to the UK.
     
  13. martin363

    Hitman

    Joined: 18 Jan 2012

    Posts: 640

    Location: Ho Chi Minh, Vietnam

    Agreed, a pension is a MUST, and the earlier the better. We are now in a position where we have been advised to pay no further contributions into it, as it will likely exceed the gov limits before we are ready to take it. I stopped paying in in 2004. Compounding and a final salary cash out done right is great.
     
  14. Martynt74

    Capodecina

    Joined: 20 Feb 2004

    Posts: 16,083

    Location: Higher Walton

    Agreed, we've tried to set a retirement plan on one of the Greek islands and trying to do what we can to bring it as close to now as possible. Although i wonder how Brexit will impact your plans due to being over the 6 month limit. I presume you'd have to become Greek residents?
     
  15. Yaayuh!

    Capodecina

    Joined: 5 Nov 2010

    Posts: 21,115

    I'll probably die before retirement. If not, there's always money in the banana stand.
     
  16. Martynt74

    Capodecina

    Joined: 20 Feb 2004

    Posts: 16,083

    Location: Higher Walton

    :D
     
  17. martin363

    Hitman

    Joined: 18 Jan 2012

    Posts: 640

    Location: Ho Chi Minh, Vietnam

    My wife and daughter are Greek, so though I currently have no residency rights, we don’t anticipate an issue when applying for ILR. Plus we have a registered family situation, property and tax returns going back some years. We were also married in the Greek church in Athens, which helps in Greece. You are correct though, for us brexit has not been a great development.

    the limit is also 90 days in any 180.......
     
    Last edited: 24 Feb 2021
  18. Theophany

    Perma Banned

    Joined: 1 Sep 2010

    Posts: 11,227

    Location: Bell End, Worcestershire

    Just to add to this: most small town solicitors are chronically under-professionally developed people who absolutely will give you terrible advice if it increases their billable hours and most accountants will give you the facts but not the advice and leave you to make the worst decision possible in whatever way you choose.

    That isn't to say all financial advisers are good, they aren't and there is no shortage of duffers looking for an easy 1%. But they bridge the gap between these two groups of professionals who, for some inexplicable reason, people trust implicitly.

    And yes the above is very much anecdotal, but I come across it with alarming regularity.
     
  19. Mint8

    Gangster

    Joined: 25 Oct 2013

    Posts: 239

    I am intrigued as to why you say annuity ? Whats wrong with transferring to a Sipp and the ability to grow your pot ?
     
    Last edited: 24 Feb 2021
  20. Mr^B

    Mobster

    Joined: 25 Nov 2002

    Posts: 3,434

    It depends if you trust the investment to grow as in investment, it depends how long you plan on living, and finally it depends on what your retirement goals are.