Advice on early retirement - who's done it? (1 Viewer)

[haganap]

Love reading through these aren't I lucky threads... Here's my take.... I have enough to retire and could do quite comfortably. However, it took me years to get to where I am in my career and I ain't about to throw it away for pursuing one of my hobbies that I will be bored with.
Although I am the same age as the OP I love work... I get up every day enthused and ready to go..... motivated by money and how much I can make, motivated by how I can operate a business and the challenges I face on a daily basis....
I have absolutely no desire to retire and quite frankly no need to.. I was going to retire at 55- here I am at 55 pushing it out to 60. Nikki has reduced her working hours and could retire soon but chooses not to.
Someone said to me- you will know when the time is right.... I await, not with bated breath, but I await.
The OP is clearly in a different place, but PaulC70 - I employ numerous nurses in the private sector that have retired early, taken a break and come back with the flexibility they want, A couple of days a week to top up some income and getting a great balance between loving the job they set out to do and having plenty of free time not being burnt out but more importantly, not living like a poor man. I have one nurse who is 82 and still comes in 2 days a week, she loves her job, remains as fit as a fiddle and it a great nurse.

I am also an early retiree, have been for years. Not enough hours in the day for me and I do not know the meaning of the word bored, which is the point of this post.
It is not JUST about having enough money.

Friend #1: Retired at 61. Enough money, lots of home-centred hobbies which are not weather dependent. However, he did not anticipate/realise how much his identity and self-worth were tied up in his successful career. Now he is not in charge and doesn't have people to order around he finds himself completely lost, spends most of every day just scrolling around YouTube & FaceAche. Friends can see he is very depressed, has put on a dreadful amount of weight, is developing health issues, but we can't get through to him.

Friend #2: Retired early 60's, more than enough money. No hobbies other than sewing. So bored that she is scrabbling around trying to fill her days with volunteering. She has done the holidays & travel thing, and is becoming increasingly unhappy . . .

So if you are in a financial position to quit your career/job do think about what you are going to do with the rest of your life, which could be quite a few decades.

Thank you.... You mate #1 is me all over, that is exactly how I would see myself if I felt for one moment I retired. # friend 2 reminds me of my wife... I think we would both genuinely be bored stiff.

There is no doubt we are both work to live people believe me. Unfortunately though as nurses all our lives and having had 2 kids there's no savings and no investments, just our nhs pensions :-(

I thank you for your service, but your experience or financial experience is far from what many of my colleagues experience? I wonder what happened? Many of my friends I trained and worked alongside for many years are now retiring and seem to be doing rather well off? Are you sure your pension(s) are what they should be? I have friends that are retired and appear better off than when we were running up and down the wards. Remember, you have a very useful skill and something called experience, you could name your price in many places.

Yes that is the normal pension age but you can still choose to take it earlier but it would obviously be reduced, even the 2015 scheme you can chose to take at 55. If you look at the document I refer to in #116 it’s clear. The protected status that someone mentioned for some 1995 holders was just Psychiatrists and maybe psychiatric nurses as it was felt their jobs were more stressful so they could go at 50 at a sort of levelled up rate. Long gone now.

This is correct. Mental Health Officer status as it was known was for my brigade. Unfortunately it changed when I opted to go back in to the pension having not been able to afford to be in the pension scheme as every penny mattered with two babies. Fortunately, my dad made me realise sense and I jumped back in but sadly the MHO status had been removed. I jumped out the NHS in 2014 so I am lucky enough to have about 15 years of Pension? not sure what that would be worth today but one thing is for sure, if I remained in I would be a lot worse off than I am now.

 

[PaulC70]

I think Im going to have to get at the pensions people to find out exactly what is going on because a lot of its not making sense, ive seen other examples at lower wages than me with similar years talking about 15 grand plus a year so maybe theres something wrong with mine and I need to do that nagging and digging to find out.

 

[Ravelin]

I think Im going to have to get at the pensions people to find out exactly what is going on because a lot of its not making sense, ive seen other examples at lower wages than me with similar years talking about 15 grand plus a year so maybe theres something wrong with mine and I need to do that nagging and digging to find out.

Always worth checking. When I entered teaching I had a private pension that I had transferred into the teachers scheme. I got a letter from the SPPA , the administrators, telling me the credit amount applied. The next few years statements never really made sense so last year I queried it. Turns out the transfer credit wasn't appearing on my statement, and when it was reissued with it included my current annual pension at NRD almost doubled.

Would love to retire now, at 57, but doesn't currently make financial sense, but both my wife (58) and I are working towards at least semi retirement in a few years.

 

[DandJ]

I was certainly one of the ones who was advising you with all of your joint health issues to get out now but knowing that you’ve worked all your life in the NHS as a nurse I think it’s still true that if you take your pension before 55 it really does get hammered a disproportionate amount. Well worth taking advice though.

Regarding your wife. I don’t understand why if she’s also a nurse and has had a stroke and needs a wheelchair quite a bit why she’s not on disability( or whatever it is called now) with a view to getting a full pension on those grounds. The unions are normally really helpful on this sort of thing.

Hi Carolyn....it shouldn't matter for this thread, but you seem to have me mixed up with someone else on the site. I've already retired, wasn't NHS and my wife isn't/wasn't a nurse.
Dave

 

[carolyn]

Hi Carolyn....it shouldn't matter for this thread, but you seem to have me mixed up with someone else on the site. I've already retired, wasn't NHS and my wife isn't/wasn't a nurse.
Dave

I meant to quote the OP. Apologies. He is a nurse and it’s his wife who is a nurse and has loads of health issues. Dumb moment.

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[TwistNShout]

If you have money, your health and some hobbies you will love retirement, if you lack any one of them then you may find it more difficult.

This is key to enjoying retirement, I'm constantly surprised by the people I meet whom just stopped working with no plan as to how they would fill their time.

It helps enormously if your partner, (if you have one), shares some of your hobbies. My wife supports and takes part in all of mine except the woodworking.

Definitely, our issue is that I have a huge number of hobbies and workshops with several jobs on the go my wife's hobbies are socialising and looking after me. So you both need things to occupy your time.

We spent a lot of time working out budgets, front loading spending for the big expensive trips. I still get offers of "could you help us out for a few months, what's your day rate?" But we don't need the money and we're never home for long enough at a time.

 

[BillyBeckers]

Are you serious? There's not enough hours in the day. I buy a Times on Saturday. Some weeks I don't even get to finish reading it.

I can totally understand that. I buy the Sunday Times every week and am currently 2 weeks behind

 

[BillyBeckers]

I created a spreadsheet, tracking our spending for ~3 years before retirement. This came straight from bank statements - so not some abstract 'budget' which falls apart when you forget to include things.

I then added new expenses - both one-off and recurring. Extra holidays, etc. And deducted commuting.

I also created a one-off budget for the big things - cars, house repairs, health. eg. new car and motorhome every six years.

I used this to forecast our financial position - when to take DB pensions, investments etc. And I included the risks. Some of which have materialised (eg. period of high inflation).

The one thing I could not have forecast was covid - but fortunately, that boosted our finances.

But as others have said. It's easy to focus on what you're escaping from (eg. bad job) and not enough on what the future looks like. I started volunteering on the local steam railway one day a week, joined some local history groups, etc.

Edited to add: We also downsized the house and moved to a new area. Wanted to do that whilst we were young enough to make a new start, Bought a new build with much lower running costs, low maintenance garden.

I did exactly the same, creating a spreadsheet to monitor
the previous 3 years spending using bank and credit card statements. It was a real eye opener. I really didn’t have a true idea of our annual budget prior to this. It also helped me identify a number of old subscriptions we were still paying that were no longer required.

Edit - We are also considering downsizing and relocating.

 

[TwistNShout]

I did exactly the same, creating a spreadsheet to monitor
the previous 3 years spending using bank and credit card statements. It was a real eye opener. I really didn’t have a true idea of our annual budget prior to this. It also helped me identify a number of old subscriptions we were still paying that were no longer required.

Edit - We are also considering downsizing and relocating.

I'm glad that I wasn't the only one with spreadsheets, my wife thought I was being a bit ott. Like others, I was a bit surprised at what we had spent on some things over the previous years. Included in the sheets are when state pension kicks in, so we can reduce pension draw down, as well as one mh replacement and one car replacement each. We won't buy new and I'm sure my estimate is wrong but at least I tried.


All of this just gave us confidence that we could do it. We're now over two years in and I aim to sit down and compare actual to estimates in the next few months, especially as investment funds haven't been earning as well as we hoped.

 

[Rapides]

Tired, really just tired of life at the moment and looking at early retirement but only 54 (at end of June) and wife is 56.

For those of you that have done it, Im wondering if you went to an independent financial advisor as part of your research or how did you work out what you could afford?

We retired at 63 and 60 respectively, so not particularly early. Didn’t seek specific advice about the funding, budgets, etc because we’d reached a point where it was obvious our cash savings were enough to help out until our occupational and state pensions kicked in.
However, I do have a separate defined contribution pension pot that I wasn’t happy to leave self-managed in my former employer’s scheme. I transferred it to a SIPP and pay someone to manage it. It was a leap of faith that took some soul-searching, but a year in and I’m happy with how the pot is performing.

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[meanders]

I took early retirement at 50 when made redundant as it was very advantageous financially to do so. Then immediately went to work for another company, before setting up my own consultancy. More or less retired formally at 67 but did my last paid work day last year at 73.

Have been volunteering a lot so keeping busy.

My advice is to do what seems right for you. Everyone has different backgrounds and finances. If you can retire early with good financial security great. Equally, you will need to find something to do. 52 weeks holiday a year isn't as easy as it sounds.

 

[15isto2]

nhs pensions chat, member led discussion group on Facebook is well worth joining

 

[15isto2]

just looking at your pay, I thought you were an ANNP which I assumed was 8a these days. Please tell me that you are part time and not doing it on band 7.

 

[PaulC70]

just looking at your pay, I thought you were an ANNP which I assumed was 8a these days. Please tell me that you are part time and not doing it on band 7.

nope full time on 8a.

 

[15isto2]

nope full time on 8a.

I would check with pensions that they have your correct pay details, I’m bottom 8a with @ 1:4 weekends and no nights and my pensionable pay is several thousand higher than showing on your estimate.

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[our poppy llll]

Tired, really just tired of life at the moment and looking at early retirement but only 54 (at end of June) and wife is 56.

For those of you that have done it, Im wondering if you went to an independent financial advisor as part of your research or how did you work out what you could afford?

If you can afford it, it’s the best thing you can do, im 66 in July. I retired 10 years ago. These last ten years have been the best. However we found time to work is beyond me.

I found I could live of £2800 a month, very comfortably but we live a bit if a high life. Our pensions will give us that, wife’s state, our small private pensions and my state next month.

Today with high interest rates we get more interest than we spend and our pensions will just stay in the bank.
This will change as interest rates drop. But even so I’ve said we’ll top up to £4000 a month.

So 12 months at £1200 per month £14,400 per year .. 25 years = £360,000 If you have savings and assets equal to that level, use the interest and withdraw from your savings the difference. Eventually you will run out of money but you’ll be very old anyway, just keep enough for your funeral.

If you don’t spend £4k a month, it stays in your savings and as costs rise in 5-10-15 years what you save covers the increases in costs of living.

this does not work for those in debt or with mortgages. If you are careful, your expenditure will be less than your pensions. But don’t live the high life while waiting the next 12 years for your pensions.

.

 

[PaulC70]

I would check with pensions that they have your correct pay details, I’m bottom 8a with @ 1:4 weekends and no nights and my pensionable pay is several thousand higher than showing on your estimate.

Ah yes but only been 8a for just 3 years now, previously only a 6 :-/ I am however challenging the pension people as I do feel they've not given me accurate information and have joined the aforementioned facebook group which has been very informative and helpful.

 

[Brains]

I was 'retired' at 60 the main cause was the pandemic, which made my job impossible for the best part of a year or more.

But I also think the company was 'ageist' as by then I was the oldest person in the division by then (150 people, mostly in their twenties and thirties)
I had been doing the job longer than most of them had been alive, and I suspect they got tired of me telling them exactly where their 'latest' idea would go wrong as the last time we did it, it did not work because .....

The Pandemic gave them a perfect exit strategy.
They have since had to employ two other 'older' people to fill my space.
But I've found out that a series of training videos I made a decade ago have been dusted down and are back in regular use.
I also see my profile it typically getting 20-30 hits a week, half of which are from the company I used to work for when they look for the resident expert in the field.

That all said, I was thinking of retiring at 62'ish so in 2022'ish.

With the benefit of hindsight, I probably should have retired about 2018'ish, late 50's.
I could have done a lot more, but I think the motorhome might have been a campervan!

 

[Brains]

The critical thing is the interest rate.
The PFI's typically use a pessimistic 3.5% (at the moment it's 4.25%)

Which means for every £100,000 in savings/pensions you will get £3,500 per year.

Which means to earn the current minimum wage of £12,500 PA (which puts you below the official poverty line).
You need to have £350,000 in pensions/savings.
At this income you would also be below the minimum tax level.

In the real world, a pension pot of a minimum £600,000, will give you at least £21,000 PA, which as long as you don't have any Mortgages/rent or debts or any expensive hobbies or lifestyle should be a reasonable life.
Of course if two of you have that sort of money in a pension pot, you can live very nicely !

So how much is in the Pension pot ? Under £350,000 ? Then keep working!

Over £600,000 ? Then, as long as you are not paying rent or a Mortgage and debts are paid off, you can start planning a retirement date !

 

[gus-lopez]

If you have money, your health and some hobbies you will love retirement,

I have one out of the three

So how much is in the Pension pot ?

Nothing.

I packed in working 22 years ago.i received my state pension 5 years ago.

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[Brains]

So how much is in the Pension pot ?

Nothing.

I packed in working 22 years ago.i received my state pension 5 years ago.

With no job and no pension.
What did you live on for 17 years ?
Savings ??

 

[Dutch 68]

With no job and no pension.
What did you live on for 17 years ?
Savings ??

Job on the side ,Gus offers the final solution to your problems

 

[Brains]

Job on the side ,Gus offers the final solution to your problems

I was suspecting something similar.
What is known as a 'long stretch'

 

[Fragle]

The critical thing is the interest rate.
The PFI's typically use a pessimistic 3.5% (at the moment it's 4.25%)

Which means for every £100,000 in savings/pensions you will get £3,500 per year.

Which means to earn the current minimum wage of £12,500 PA (which puts you below the official poverty line).
You need to have £350,000 in pensions/savings.
At this income you would also be below the minimum tax level.

In the real world, a pension pot of a minimum £600,000, will give you at least £21,000 PA, which as long as you don't have any Mortgages/rent or debts or any expensive hobbies or lifestyle should be a reasonable life.
Of course if two of you have that sort of money in a pension pot, you can live very nicely !

So how much is in the Pension pot ? Under £350,000 ? Then keep working!

Over £600,000 ? Then, as long as you are not paying rent or a Mortgage and debts are paid off, you can start planning a retirement date !

What planet are you living on. £350 k and you have to keep working.
I retired at 60 with nowhere near your £350 k. Yes I have no debt ect and we live a comfortable lifestyle Doing 2x 90 days in Europe each year

Sounds like financial advisor talk

 

[andyman]

The critical thing is the interest rate.
The PFI's typically use a pessimistic 3.5% (at the moment it's 4.25%)

Which means for every £100,000 in savings/pensions you will get £3,500 per year.

Which means to earn the current minimum wage of £12,500 PA (which puts you below the official poverty line).
You need to have £350,000 in pensions/savings.
At this income you would also be below the minimum tax level.

In the real world, a pension pot of a minimum £600,000, will give you at least £21,000 PA, which as long as you don't have any Mortgages/rent or debts or any expensive hobbies or lifestyle should be a reasonable life.
Of course if two of you have that sort of money in a pension pot, you can live very nicely !

So how much is in the Pension pot ? Under £350,000 ? Then keep working!

Over £600,000 ? Then, as long as you are not paying rent or a Mortgage and debts are paid off, you can start planning a retirement date !

I’d better go back work. And put more than I was earning a year in my pension pot.

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[Brains]

What planet are you living on. £350 k and you have to keep working.
I retired at 60 with nowhere near your £350 k. Yes I have no debt ect and we live a comfortable lifestyle Doing 2x 90 days in Europe each year

Sounds like financial advisor talk

A pension pot of £350,000 will give you about £235 a week.
Which is the equivalent of 2 days a week job at minimum wage.
It is also roughly the same amount as the state pension.

If you can survive in the UK on that amount, you are doing well.
Many however end up on the street trying to survive on that amount.

You may have 2 x 90 days on the mainland each year,
But you would never be able to afford to replace the motorhome.
One expensive bill (Vehicle, health, etc) could make you destitute overnight.

 

[Brains]

I’d better go back work. And put more than I was earning a year in my pension pot.

If you start early, ideally in your 20's then it's fairly easy.
The later you start, the harder it gets.
Remember most companies will match your contributions up to a point.

The company I worked for back in the late 80's had a Pensions Advisor from the Norwich come in and do a company wide talk.
The one thing I remember was him saying that by the time we all reached retirement age in the late 2020's (soooo far ahead then) then state pension would be almost worthless as the number of recipients would be substantially greater than the number of contributors.

Therefore unless you want to be begging on the streets in old age, get your own personal pension up and running ASAP.

I followed his advice.
With the benefit of hindsight, he was correct.

 

[ontheroadagain]

A pension pot of £350,000 will give you about £235 a week.

Is your calculation based on only withdrawing the potential growth (eg 3.5%) and keeping the £350K invested?
You could take more and reduce the £350k to zero over a 25 year period for example.

 

[Brains]

I’d better go back work. And put more than I was earning a year in my pension pot.

FYI:

HMG recommends the MINIMUM amount every person needs to contribute to their pension pot is 12.5% of their salary.
The Average Salary is around £35k in the UK
Which means as a minimum you should be putting in £4,375 PA (£364 PCM/£91 PW) into your pension pot from your early 20's onwards.

The way I did it was start early.
Put in as much as the company would fund match me for (which was about 5%)
and then once the mortgage was paid off I carried on paying the same amount every month into the pension pot.

Unfortunately anyone now looking into the entire pension situation and in their 50's may have left it too late.
You need to start early to actually benefit.

 

[Dutch 68]

FYI:

HMG recommends the MINIMUM amount every person needs to contribute to their pension pot is 12.5% of their salary.
The Average Salary is around £35k in the UK
Which means as a minimum you should be putting in £4,375 PA (£364 PCM/£91 PW) into your pension pot from your early 20's onwards.

The way I did it was start early.
Put in as much as the company would fund match me for (which was about 5%)
and then once the mortgage was paid off I carried on paying the same amount every month into the pension pot.

Unfortunately anyone now looking into the entire pension situation and in their 50's may have left it too late.
You need to start early to actually benefit.

People putting 4375 per annum from their 20’s , you must think of the privileged few, most youngsters are trying to get up the housing ladder and can’t get access to that kind of money to put away in a pension , and even that is difficult enough for most, plenty of youngsters with a masters degree working in Tesco or Mc D

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