I've finally decided on a retirement date from work...31/12/2024

Chalky

TTony said:

Chalky said:

but my advice to anyone else who has a high-pressure, multi-layered 60 hour a week job is: Don't underestimate the potential for negative impact on your mental health if you suddenly retire.

I think that's very wise.

To some extent, some employers try to prepare their employees for retirement with pre-retirement courses, etc.  But, for those of us who are self-employed, we have to prepare ourselves.  I'm still planning on phasing-out gradually and avoiding that hard stop.

Very true about the training, and I knew about from management training I received back in the 80s.  Also had a person in my extended family who'd retired from being Chief Super in the Met at Cannon Row nick, so I knew all about 'Leafy Lane syndrome'. 

Trouble is, like many of these things, you always think you're somehow different and will be able to cope better than others.  And you're prepared, so you are sure to be fine.

Then it happens and you realise that reality kiboshes theory - always.

RandallFlagg

LPManic said:

RandallFlagg said:

rze99 said:

Read with keen interest. Thanks for providing some hope! 

I would encourage everyone to get a plan together, there are tools available to help but you need to be a little tuned in to pensions, funds, taxes, drawdown options and debt. Plus you really need a detailed budget to be able to project how much money you will need in retirement.

I have a detailed budget monthly, which is updated daily with actual spend as it happens and have projected this out monthly through to March 2026 with all expected income and outgoings! But I am OCD with money and love spreadsheets.

Randall I seriously need to learn your ways.

If you have time or interest, please offer us normal folk some pointers.

I would be more than happy to outline the way I have steered our personal finances through our journey, but you must recognise that I am no financial advisor and not qualified to give financial advice to anyone, only point out my views, opinions and lessons I have learned, mistakes I have made and successes along the way. I can point to a considerable trove of resources that have helped me for others to consider. I will just have to be careful to caveat everything I post as my opinion and not advice.

We have been very lucky on our personal journey in that I have worked in a well paid job, in management for some time so had the benefit of a good salary and generous company contribution into my pension.

I am conscious that not everyone will be in such a lucky position, so don't want to appear to be gloating or bragging, but, many of the principles I follow, in my opinion, can apply to anyone, whatever, income or position in life they are. I firmly believe that if i knew 20 years ago what I know now, I would already be retired, even without the promotion to a management position in 2013.

I will give it some thought and maybe consider starting another thread over the next day or two sharing my key personal learnings for others to review and debate. There are many ways to Jericho, and certainly when it comes to my investing strategy, I'm sure that some will not agree with my approach, @ToneControl, for example, prefers to steer a different course and we differ considerably in our market outlook! 

One thing to bear in mind is that I love spreadsheets, the world of personal finance and have a love of learning more and more about it. I know from work that many people don't and fog over when I mention the word ‘pension’ which seems to hold such mystery for many, when if fact, the basics about pensions can be quite simple to to grasp, and as individuals we have more power to control the direction of pensions than some may realise, if we choose to.

does that sound of interest to anyone?

Iamnobody

RandallFlagg said:

LPManic said:

RandallFlagg said:

rze99 said:

Read with keen interest. Thanks for providing some hope! 

I would encourage everyone to get a plan together, there are tools available to help but you need to be a little tuned in to pensions, funds, taxes, drawdown options and debt. Plus you really need a detailed budget to be able to project how much money you will need in retirement.

I have a detailed budget monthly, which is updated daily with actual spend as it happens and have projected this out monthly through to March 2026 with all expected income and outgoings! But I am OCD with money and love spreadsheets.

Randall I seriously need to learn your ways.

If you have time or interest, please offer us normal folk some pointers.

I would be more than happy to outline the way I have steered our personal finances through our journey, but you must recognise that I am no financial advisor and not qualified to give financial advice to anyone, only point out my views, opinions and lessons I have learned, mistakes I have made and successes along the way. I can point to a considerable trove of resources that have helped me for others to consider. I will just have to be careful to caveat everything I post as my opinion and not advice.

We have been very lucky on our personal journey in that I have worked in a well paid job, in management for some time so had the benefit of a good salary and generous company contribution into my pension.

I am conscious that not everyone will be in such a lucky position, so don't want to appear to be gloating or bragging, but, many of the principles I follow, in my opinion, can apply to anyone, whatever, income or position in life they are. I firmly believe that if i knew 20 years ago what I know now, I would already be retired, even without the promotion to a management position in 2013.

I will give it some thought and maybe consider starting another thread over the next day or two sharing my key personal learnings for others to review and debate. There are many ways to Jericho, and certainly when it comes to my investing strategy, I'm sure that some will not agree with my approach, @ToneControl, for example, prefers to steer a different course and we differ considerably in our market outlook! 

One thing to bear in mind is that I love spreadsheets, the world of personal finance and have a love of learning more and more about it. I know from work that many people don't and fog over when I mention the word ‘pension’ which seems to hold such mystery for many, when if fact, the basics about pensions can be quite simple to to grasp, and as individuals we have more power to control the direction of pensions than some may realise, if we choose to.

does that sound of interest to anyone?

I’d be interested to hear your opinions and strategy. 

I’ve got 15 years to sort my shit out and retire at 60 and hopefully have an active retirement health permitting etc. 

Or 23 years to roll over at 68 and wear beige. 

ewal

Chalky said:

...
Suddenly, I no longer had pressure or motivation, had none of the good feelings that come from teamwork and collaboration, no conversations about challenges and how we would overcome them, no intellectual debates, no big difficult problems to be analysed and solved against the clock, and of course no sense of success and celebration of a good job done.
...

That sounds like my work post lockdown. The teamwork, camaraderie and sense of purpose have gone. Hence I'm now thinking more and more about retirement, or at least switch to a mode where any work I do will be out of choice.

I'm 56 now and have decided that 60 is the arbitrary age this will happen. I'm in a defined benefit pension scheme, so it's more a matter of how much per year I'm willing to sacrifice.

sev112

Those of you that mention have taking some kind of early redundancy in your 50s : I’m 57 and waiting for either that discussion , what should one be looking for ?

Musicwolf

sev112 said:

Those of you that mention have taking some kind of early redundancy in your 50s : I’m 57 and waiting for either that discussion , what should one be looking for ?

You'll need to check the latest rules from HMRC but when I did my 'sponsored walk' three years ago I got the first £30k tax free then I was able to pay the rest into my pension scheme (you can pay, I think, £40k pa into pension schemes but you can back date that three years).  Paying into my pension meant that I can draw a 25% out tax free then I'll pay 20% tax on the rest by withdrawing it over time (rather than pay 40% on the lot if I'd taken it as cash).

RandallFlagg

Musicwolf said:

sev112 said:

Those of you that mention have taking some kind of early redundancy in your 50s : I’m 57 and waiting for either that discussion , what should one be looking for ?

You'll need to check the latest rules from HMRC but when I did my 'sponsored walk' three years ago I got the first £30k tax free then I was able to pay the rest into my pension scheme (you can pay, I think, £40k pa into pension schemes but you can back date that three years).  Paying into my pension meant that I can draw a 25% out tax free then I'll pay 20% tax on the rest by withdrawing it over time (rather than pay 40% on the lot if I'd taken it as cash).

See redundancy rules here: https://www.gov.uk/redundancy-your-rights/redundancy-pay#:~:text=You%27ll%20normally%20be%20entitled,or%20older%2C%20but%20under%2041

From this tax year you can now pay £60K into your pension including the employers contribution, plus carry froward of any remaining allowances from the last 3 years which were capped at £40K per year.

viz

Didn’t know about the last 3 years thanks RF; gonna put 120k into my pot this year then!

RandallFlagg

viz said:

Didn’t know about the last 3 years thanks RF; gonna put 120k into my pot this year then!

Confirmation on HMRC website here:

https://www.gov.uk/tax-on-your-private-pension/annual-allowance

RaymondLin

Wish i can put away £40k a year lol, that's more than i earn.

boogieman

Chalky said:

I'm a happy pensioner now.  But I suddenly retired as the pandemic started, taking it as a window of opportunity to relinquish all my work commitments.  Good decision overall, but dropping from high pressure 12-hour days to zero work took a huge toll on my mental health.  I wildy underestimated the impact. 

Suddenly, I no longer had pressure or motivation, had none of the good feelings that come from teamwork and collaboration, no conversations about challenges and how we would overcome them, no intellectual debates, no big difficult problems to be analysed and solved against the clock, and of course no sense of success and celebration of a good job done.

I have several hobbies but none of them were in any way a substitute for my previous work.  It took a couple of years and a battering to my health to get it all out of my system.  Not sure how it could have gone better, because of the lockdowns, but my advice to anyone else who has a high-pressure, multi-layered 60 hour a week job is: Don't underestimate the potential for negative impact on your mental health if you suddenly retire.

That’s similar to what happened to my dad. He was in middle management and heading toward compulsory retirement age (when that was still a thing, before the age discrimination laws came in) but was told the company would keep him on to train his successor. Literally weeks before his 65th birthday the company was taken over and he was told he’d be going in a month’s time. Suddenly he’d gone from a high pressure well paid job to just sitting at home twiddling his thumbs, with virtually no time to adjust. I got really worried about him and his mental health, because he lost interest in everything… he didn’t want to go out, didn’t want to try doing anything new, didn’t even want to take a holiday. Eventually after about a year of virtually becoming part of the sofa, he went to visit his brother and came back with a newfound interest in wood turning and carving. He wasn’t very good at it, but that really didn’t matter, he’d got his spark back. That’s what I was referring to in my earlier post: ideally you have to gear up for retirement and almost treat it like a new job. 

maharg101

It's really interesting to read about people's different experiences. I'm 53, and have dropped down to a 4 day week this year, 3 day week planned for next year, then possibly down to a 1 day week when I'm 55. I have a couple of pensions I can take from 55, and they would be enough to get by on by themselves, with some minor lifestyle changes. So I'm quite fortunate in that respect. My wife is already retired, having taken a medical retirement some years ago following a stroke.

I'm thinking that keeping 1 day a week going for a while will be a good thing. Almost zero pressure / stress, whilst keeping the benefits of working i.e. wedge and interactions with colleagues.

viz

^ that sounds ideal (apart from the stroke obviously) 

viz

RandallFlagg said:

viz said:

Didn’t know about the last 3 years thanks RF; gonna put 120k into my pot this year then!

Confirmation on HMRC website here:

https://www.gov.uk/tax-on-your-private-pension/annual-allowance

Cool, cheers. I was slightly joking about putting away 120k this year, but thank you for the info 

Philly_Q

RandallFlagg said:

One thing to bear in mind is that I love spreadsheets, the world of personal finance and have a love of learning more and more about it. I know from work that many people don't and fog over when I mention the word ‘pension’ which seems to hold such mystery for many, when if fact, the basics about pensions can be quite simple to to grasp, and as individuals we have more power to control the direction of pensions than some may realise, if we choose to.

The funny thing is, although I'm an accountant and no stranger to spreadsheets (although you can keep your macros and pivot tables and charts and all that complicated shit).... I'm also one of those people who fogs over when you mention the word "pension" and I really don't have much interest in personal finance. 

I keep a record of what I receive and spend, I know exactly what assets I have and where they are, but I don't "manage" them at all.  I need to get to grips with it but I don't have the time and I'm not interested enough to make the time.

RandallFlagg

Philly_Q said:

RandallFlagg said:

One thing to bear in mind is that I love spreadsheets, the world of personal finance and have a love of learning more and more about it. I know from work that many people don't and fog over when I mention the word ‘pension’ which seems to hold such mystery for many, when if fact, the basics about pensions can be quite simple to to grasp, and as individuals we have more power to control the direction of pensions than some may realise, if we choose to.

The funny thing is, although I'm an accountant and no stranger to spreadsheets (although you can keep your macros and pivot tables and charts and all that complicated shit).... I'm also one of those people who fogs over when you mention the word "pension" and I really don't have much interest in personal finance. 

I keep a record of what I receive and spend, I know exactly what assets I have and where they are, but I don't "manage" them at all.  I need to get to grips with it but I don't have the time and I'm not interested enough to make the time.

I thinks that's the case with many people, I speak with Managers from our Finance Dept and they are the same. The word ‘Pension’ does seem to come with an air of complication and mystery for many people, but at the end of the day it's just another type of account where you save money, much like an ISA or bank account, just with differing tax treatments and withdrawal conditions. This became much more apparent to me once I passed the age when I could withdraw from my pension.

Money is money, it's the same stuff whichever account it is in.

RaymondLin

Pension to me has always been so far away, I didn't even have a work one until I was in my early 30's, right now I've still never sat down and done a spreadsheet, mainly because I don't earn enough to really need it, I know how much I have after bills left each much and then just save as much as I am able to.

I have not sat down to work out how much i will be getting, I am just putting away as much as i can afford, starting with my work contribution, and then anything left over I chuck it at Vanguard.  Since they are not a normal bank account, i see it as money out of my reach which is the best thing.  If it's all in my normal account I might end up spending it or something.

Koa

It’s the ‘pensions trundling along ‘in default funds bit that interests me, I think many of us with some sort of pension just trust the ‘experts’ 

RandallFlagg

Koa said:

It’s the ‘pensions trundling along ‘in default funds bit that interests me, I think many of us with some sort of pension just trust the ‘experts’ 

From everything I have learned, and I may be cynical, but I am of the opinion that the pension fund management industry is more about what cut of the gains your money makes, through being invested in the market, that they can take rather than put in your pocket. They are like the house croupier at a casino, the rake comes out and they take their cut. 

Actively managed funds fees mount up over decades and can ravage your potential returns, which are mediocre at best in default house funds. Index funds are much lower cost, give you real market returns and can save you tens of thousands or more over a working lifetime.

The facts around active fund vs index fund performance and fees are well documented for anyone to research.

https://youtu.be/FlpwTJJEasA

mrkb

Im interested in how much per year people think they’ll need to retire. It’s something I’m struggling to work out, hence it’s difficult to determine when I can retire.