Financial Planning for Retirement - where are you?

[trentlad]

I thought my wife and I were doing quite well with savings and investments but she sent me an email today which apparently declares us as far behind:

By age... Aim to have saved:

30......... ½X your salary
35......... 1X your salary
40......... 2X your salary
45......... 4X your salary
50......... 6X your salary

It seems crazy expecting to double your savings every five years. Where are you guys, on track or do you have other plans?

 

[trentlad]

Everything that you'd use as a source of income after retirement.

 

[trentlad]

I'm retired (age 36) and my income is £18k a year approx depending on share yield, dividends etc. This is roughly 40% of what I earnt prior to retiring and the investment pot is approx £225k with a yield of around 8% a year. Happy with that... retired - as in never intending nor never needing to work again for financial reasons. £18k is more than adequate with no mortgage and no debts.... Plus when I get to 50 I can draw on my workplace pension (which is another £9k) then there is the state pension @ 68 (or whetever they change it to) so that's another £8k. So, without adjusting for inflation, I'll be drawing £35k at least at state pension age - should be more than that though as the investment pot grows over time (I'm not drawing down 100% of the return) and whatever equity release scheme on my house brings in.

How have you managed to retire and still earn 18K per annum at the age of 36... ah I see now but what if those investments reduce in return?

I have to say I'm impressed that you had the reservation to invest so early in your career and the will power to cut down on your living costs and not live lavishly on what you could have earned. Well done!