Retirement

[SPUFF]

True, and it depends on what self employed you do. If you are essentially doing what you are told by who you signed a contract with, then it has the same pressures as being employed. I.e., if you are signed up to provide a service.

Out of my vets football team, a few are retired and the rest planning towards it, except one bloke who just doesn't want to retire. He built his business up from scratch, initially a shop. But then he realised to get quality products he would have to source them himself and import them. He deals with things like student/hippy stuff, the sort of shops that sell insence, baggy clothes and have stalls at music festivals. So he was off to the likes of Mexico, Nepal, more remote places in India etc, to check out places to buy from and make sure it was all ethical, not sweat shop etc. He spends a fair bit of time per year travelling to these places and because he brings in lots of money, the locals take him out with pride to see their country, walk their mountains, eat the authentic food etc.

He realised that rival shops (there seems to be one in each town so not close rivals) also had the same supply and import issues, so he became an importer to stock them too.

His kids now run most of the business, so it seems like he works the hours and days he wants, spends a fair bit of time travelling to amazing and remote parts of the world, has a laugh with the warehouse lads and doesn't have any pressures of reporting to anyone. He makes very good money if he works or if he doesn't.

I can see why he doesn't want to retire from that.

Sounds like a role he can dip in n out of while the nuts n bolts of the operation are someone elses ballache. Ideal.

 

[Matt Hopkins]

Raises an interesting question in my mind. When thinking about helping our kids financially we usually think deposit for a mortgage or reducing university debt. But if we have to choose between these options, is paying a lumper into a pension pot for them at say 18 a better use of money? Gives them maybe 40 years of growth on that money on top of whatever else they can put in themselves through employment pensions. Ideally help them on all fronts, and I guess the main incentive for paying into a pension...the tax relief... only applies if they're paying enough tax already. But maybe when they start earning decent money and can get that tax relief, it's perhaps one of the best things you can do for them.

Don't think you can do that unless they're earning. If they are it's £60k or tbe amount they earn whichever is higher. Think if you're a non earner the most you can put in is £2880 which is then topped up to £3600

 

[SpiritofBurnden]

Yeah interesting, just skimmed it like,in as much as it says £28600 for a moderate retirement. I've said before everyone's wants and needs are different but that works out after tax of £2100 ish per month, I'd be living more than a moderate retirement if I was getting that

Someone posted an article with a completely different set of calculations a few pages back.

£20K was given as the amount needed for a moderate retirement in that one.

 

[Matt Hopkins]

Someone posted an article with a completely different set of calculations a few pages back.

£20K was given as the amount needed for a moderate retirement in that one.

Yeah I take all them figures with a pinch of salt, there'll be some people on here working full time and not getting near £29k a year

 

[Darlo1973]

Yeah interesting, just skimmed it like,in as much as it says £28600 for a moderate retirement. I've said before everyone's wants and needs are different but that works out after tax of £2100 ish per month, I'd be living more than a moderate retirement if I was getting that

Of course that's £2100 at the age of receiving the state pension. If you want to retire before that then a pot of £28,600 won't last you very long.

Not working also means having more time on your hands to do stuff. Are you going to be happy sitting at home all day watching the telly?

 

[Matt Hopkins]

It’s amazing how many clients tell you they want to retire at 58 or 60 but only have £20k in a pension and no savings. Then the reality sets in that they’re stuck working until state pension age.

That’s why it’s very important to start young.
Auto enrolment has helped with this a little bit but just paying the minimum with the additional employer contributions at least gives you a start.

People certainly need more education on pensions. A few people where I worked thought the fact that they had a private pension meant they were sorted in retirement despite the fact they were just paying in the bare minimum.
Think they need to take more ownership as well leaving your money in the default fund is not necessarily the best thing to do

Of course that's £2100 at the age of receiving the state pension. If you want to retire before that then a pot of £28,600 won't last you very long.

Not working also means having more time on your hands to do stuff. Are you going to be happy sitting at home all day watching the telly?

It's not a pot of £28600 that's what it says you need per year

 

[DaveH]

Sounds like a role he can dip in n out of while the nuts n bolts of the operation are someone elses ballache. Ideal.

Pretty much, though he denies he is part time/semi retired.

The last time we chatted about it, he got up, went out to play squash, went to work for an hour to check on things, spent the afternoon looking after one or two grandchildren then had a light tea before coming to play football. A bit different from the full time day I had!

It's not a pot of £28600 that's what it says you need per year

I was working on a figure of £20k per year each, so £40k joint income.

 

[TAD]

Wife's been doing this 15 years and helped us make 3 or 4 big positive decisions, we probably wouldn't have

Just watch it with new EU rules. If you are non resident you can only spend 6 months in e.g. Spain

I thought it was 90 days?

 

[Jap Stammer]

I think a lot of people will be surprised at how little you need to live comfortably in retirement - the natural thing is to base it on how you live now and project that forward, but that's not necessarily an accurate representation.

My Dad retired at 57 - it wasn't voluntary, he just couldn't do the type of work he was used to because of long-standing back and knee issues (no pun intended). He had a couple of small work pensions and State Pension when he reached 65. My Mam had been retired through ill-health for many years prior to him retiring and she got her pension (at a reduced rate) from the date she actually left work.

They had no mortgage, no major bills other than utilities and SKY TV and they still managed a night out every week, a meal somewhere nice once a month or so, and between 2 and 3 foreign holidays a year - nowhere flash, mind. Just somewhere relatively cheap with a lot of sunshine. They drove a small hatchback.

My Dad always used to tell me that I'd be shocked at how well you could live on what was a relatively small annual income (I wasn't - I'd seen it in practice with them) once there were no major bills to pay, no kids to look after and no cost of going to work to factor in.

Retire as soon as you can, folks. As someone stated earlier, you're a long time dead and you can't take it with you. Plus you'll be freeing up employment for someone younger than you who needs it more.

 

[SPUFF]

Pretty much, though he denies he is part time/semi retired.

The last time we chatted about it, he got up, went out to play squash, went to work for an hour to check on things, spent the afternoon looking after one or two grandchildren then had a light tea before coming to play football. A bit different from the full time day I had!

I was working on a figure of £20k per year each, so £40k joint income.

Living the dream that like. I can have similar days then some hellish ones.

I think a lot of people will be surprised at how little you need to live comfortably in retirement - the natural thing is to base it on how you live now and project that forward, but that's not necessarily an accurate representation.

My Dad retired at 57 - it wasn't voluntary, he just couldn't do the type of work he was used to because of long-standing back and knee issues (no pun intended). He had a couple of small work pensions and State Pension when he reached 65. My Mam had been retired through ill-health for many years prior to him retiring and she got her pension (at a reduced rate) from the date she actually left work.

They had no mortgage, no major bills other than utilities and SKY TV and they still managed a night out every week, a meal somewhere nice once a month or so, and between 2 and 3 foreign holidays a year - nowhere flash, mind. Just somewhere relatively cheap with a lot of sunshine. They drove a small hatchback.

My Dad always used to tell me that I'd be shocked at how well you could live on what was a relatively small annual income (I wasn't - I'd seen it in practice with them) once there were no major bills to pay, no kids to look after and no cost of going to work to factor in.

Retire as soon as you can, folks. As someone stated earlier, you're a long time dead and you can't take it with you. Plus you'll be freeing up employment for someone younger than you who needs it more.

A grand nearly covers my golf membership n season ticket.

Probably average 2 games a week n get to all homes. Thats you entertained for about a third of the year. Plus a few grand pints n bait like

 

[DaveH]

Living the dream that like. I can have similar days then some hellish ones.

It would be nice. Basically he put the business in motion and now receives the rewards regardless of input. He is a pretty smart bloke.

I'm like most here, I get paid for the time I do. When I stop working, I stop getting paid. No rolling legacy of cash coming in. There is potential for continued income from some of my wife's book writing if that takes off. But her area is popular maths and science. Coffee table reading for nerdy types or people with a casual interest in the subject who pick it up and put it down. I can't see a long sustained income from that or one of them becoming an international best seller. Really cool if she has some success with that, but it is produced purely because she is interested, not because of the money it will make.

 

[Matt Hopkins]

I think a lot of people will be surprised at how little you need to live comfortably in retirement - the natural thing is to base it on how you live now and project that forward, but that's not necessarily an accurate representation.

My Dad retired at 57 - it wasn't voluntary, he just couldn't do the type of work he was used to because of long-standing back and knee issues (no pun intended). He had a couple of small work pensions and State Pension when he reached 65. My Mam had been retired through ill-health for many years prior to him retiring and she got her pension (at a reduced rate) from the date she actually left work.

They had no mortgage, no major bills other than utilities and SKY TV and they still managed a night out every week, a meal somewhere nice once a month or so, and between 2 and 3 foreign holidays a year - nowhere flash, mind. Just somewhere relatively cheap with a lot of sunshine. They drove a small hatchback.

My Dad always used to tell me that I'd be shocked at how well you could live on what was a relatively small annual income (I wasn't - I'd seen it in practice with them) once there were no major bills to pay, no kids to look after and no cost of going to work to factor in.

Retire as soon as you can, folks. As someone stated earlier, you're a long time dead and you can't take it with you. Plus you'll be freeing up employment for someone younger than you who needs it more.

Nice post that. As for the last paragraph definitely that,better to run out of money than time. Pedants will say we all will eventually but you get the sentiment

 

[Derbla]

I thought it was 90 days?

Total 6 months / 90 days per stretch I think

 

[The Great Soprendo]

Don't think you can do that unless they're earning. If they are it's £60k or tbe amount they earn whichever is higher. Think if you're a non earner the most you can put in is £2880 which is then topped up to £3600

Probably not, hence better once they start earning (to get the tax relief)

 

[Derbla]

Agree Mate.
Always been good with money, paid into pensions continually since 16.
Have savings, Mortgage paid off and always the option of down sizing.
Yet still that doubt “do you have enough” rattling around in my head.
60 in December and feels like I’m looking over the edge thinking work a bit longer or jump. Trust me I want to jump, only I can make that call.
Starting to get closer to shouting, ‘fk it” and jumping. What is the worst that can happen, that really is a key defining question to most of us.
It‘s the norm to graft, work hard and struggle to suddenly see that income level reduce. Having kids later in life definitely a factor, mind you I had fk all thus they can do the same

Jump. You never know what is health wise around the corner...and once you get a few hurdles in the way you realise how being healthy shapes your thinking and provides an illusion of good times and continuity...

 

[Dark Traveller]

I think a lot of people will be surprised at how little you need to live comfortably in retirement - the natural thing is to base it on how you live now and project that forward, but that's not necessarily an accurate representation.

My Dad retired at 57 - it wasn't voluntary, he just couldn't do the type of work he was used to because of long-standing back and knee issues (no pun intended). He had a couple of small work pensions and State Pension when he reached 65. My Mam had been retired through ill-health for many years prior to him retiring and she got her pension (at a reduced rate) from the date she actually left work.

They had no mortgage, no major bills other than utilities and SKY TV and they still managed a night out every week, a meal somewhere nice once a month or so, and between 2 and 3 foreign holidays a year - nowhere flash, mind. Just somewhere relatively cheap with a lot of sunshine. They drove a small hatchback.

My Dad always used to tell me that I'd be shocked at how well you could live on what was a relatively small annual income (I wasn't - I'd seen it in practice with them) once there were no major bills to pay, no kids to look after and no cost of going to work to factor in.

Retire as soon as you can, folks. As someone stated earlier, you're a long time dead and you can't take it with you. Plus you'll be freeing up employment for someone younger than you who needs it more.

My Mam used to say quite a lot, once her and Dad were claiming state pension combined with Dad’s small work pension, they were both better off financially than they ever had been when they were both fit and working. They too had to leave work earlier than planned because of health issues. Both in their late 50s I think.

Mam used to look at their bank balance and say that her younger self would have had a fit if she saw the money they both had now.

I remember as a young un in the late 70s/early 80, Dad bringing in his pay packet, and they’d both be sitting at the dinner table working out what needed paying, what needed for food and then Mam putting a bit aside for holiday money, before giving Dad his pocket money. He used to look down at his hand and I could almost see him thinking “WTF is this?!?”

 

[The Great Soprendo]

They can't access the money in a pension for decades after they start work though.

If you help them out with a deposit for a property they'll at least be paying a mortgage rather than rent.

A big pension isn't as much use if you're spending a big chunk of it on rent when you retire.

I agree, hence saying it's about balance. There are benefits to giving them something they can't access for decades too. And of course you don't really want to be renting in retirement, but it's also worth thinking about the likely value of 40 years of compound interest and stock market growth....which has managed more than 10% a year on average over that timescale.

Assuming 10% growth pa, £10K turns into about £450K after 40 years.

 

[GordonMuchallNo1Fan]

I think a lot of people will be surprised at how little you need to live comfortably in retirement - the natural thing is to base it on how you live now and project that forward, but that's not necessarily an accurate representation.

My Dad retired at 57 - it wasn't voluntary, he just couldn't do the type of work he was used to because of long-standing back and knee issues (no pun intended). He had a couple of small work pensions and State Pension when he reached 65. My Mam had been retired through ill-health for many years prior to him retiring and she got her pension (at a reduced rate) from the date she actually left work.

They had no mortgage, no major bills other than utilities and SKY TV and they still managed a night out every week, a meal somewhere nice once a month or so, and between 2 and 3 foreign holidays a year - nowhere flash, mind. Just somewhere relatively cheap with a lot of sunshine. They drove a small hatchback.

My Dad always used to tell me that I'd be shocked at how well you could live on what was a relatively small annual income (I wasn't - I'd seen it in practice with them) once there were no major bills to pay, no kids to look after and no cost of going to work to factor in.

Retire as soon as you can, folks. As someone stated earlier, you're a long time dead and you can't take it with you. Plus you'll be freeing up employment for someone younger than you who needs it more.

Spot on this

 

[SPUFF]

My Mam used to say quite a lot, once her and Dad were claiming state pension combined with Dad’s small work pension, they were both better off financially than they ever had been when they were both fit and working. They too had to leave work earlier than planned because of health issues. Both in their late 50s I think.

Mam used to look at their bank balance and say that her younger self would have had a fit if she saw the money they both had now.

I remember as a young un in the late 70s/early 80, Dad bringing in his pay packet, and they’d both be sitting at the dinner table working out what needed paying, what needed for food and then Mam putting a bit aside for holiday money, before giving Dad his pocket money. He used to look down at his hand and I could almost see him thinking “WTF is this?!?”

“get yerself out for a half love”

 

[Fact Hunt]

I agree, hence saying it's about balance. There are benefits to giving them something they can't access for decades too. And of course you don't really want to be renting in retirement, but it's also worth thinking about the likely value of 40 years of compound interest and stock market growth....which has managed more than 10% a year on average over that timescale.

Assuming 10% growth pa, £10K turns into about £450K after 40 years.

What has grown by 10% pa for the past 40 years? I’ve missed out!