How much do you need for comfortable existence in retirement.

newbiejim

newbiejim

newbiejim

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I`m 61 in December, acutely aware of the egg timer running down :(. Awareness of being this age has just pretty recently been at the forefront of my consciousness. Consequently my thoughts are on retiring so I can have some years of being relatively fit and indulge the free time. Unfortunately I cant quite determine the balance of free time vs financial security (longer I work I get more pension, but less free time).

In short, how much per month would give a comfortable/non breadline existence (assuming no indulgent foreign holidays, pretty much just a regular existence, no mortgage to pay & circa £400 a month static outgoings.

My current thinking is £1500 a month, which is achievable for me. Is this reasonable?
 
I'm not even remotely close to retirement, but I would plan for more rather than less. My dad told me the other day that when he got to about 55, he was putting £40k a year into his pension...he is obsessed though.
 
dirtychinchilla said:
I'm not even remotely close to retirement, but I would plan for more rather than less. My dad told me the other day that when he got to about 55, he was putting £40k a year into his pension...he is obsessed though.
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Jeez I`m nowhere near that, for clarity, my private pension is circa £9k per year if I go early, remember tho @ 66.6 I get state pension which is circa £9k too, so £18k in a few years. In the interim I would supplement from savings of around £100k.

I think it boils down to valuing your free time.
 
It depends on what you want to do with retirement and how much you currently earn. £1500 a month would give some people a panic attack.
 
sanaxe1 said:
your out goings now minus your morgage and any debts which will be paid upon retirement.
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outgoings are going to change significantly when you retire though. Travel, eating habits, leisure activities, etc are all going to be completely different. I guess some things will go up and some down so it might average out around the same?
 
depends what your lifestyle will be like and how different it is now.. missus and i put in about 4% of our salary into pension per month each, as well as agreeing to put 1500pm into savings each...

If you had kids, then when they grow up, they'll look after you and help with money too.. at least for chinese anyways.. some kids may not give a sh**.
 
Ayahuasca said:
It depends on what you want to do with retirement and how much you currently earn. £1500 a month would give some people a panic attack.
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Agreed, I take home circa £2300 atm so a fair drop, BUT I can save £1000 a month atm if I`m relatively careful

It's possible what I`m asking is all but unanswerable, I just feel having got to this lofty age suddenly a decision like this seems huge, going round in circles with it lol.
 
I retired last October AT 60 and am taking £1223 per month in a draw down from a pension i took out in 1988 which was worth £120k this is not a lot but we have nothing to pay out except usual bills, and it allows us to put a bit away for holidays and buying things etc etc and keeps us under the tax barrier so we pay no tax on it, need to look into that. We went to a financial advisor who sorted this out for us which I would advise you to do.

Obviously the pot goes down but it is enough to last us until we can get the state pension which in my case is 8 years time and the wife which is in 4 years time so what will happen then is the wife will get hers so we will then take less out of my pot each month so it will obviously last longer. Hope this makes sense and is a help, but strongly advise to get expert opinion before doing it ;)
 
Griff7520 said:
I retired last October AT 60 and am taking £1223 per month in a draw down from a pension i took out in 1988 which was worth £120k this is not a lot but we have nothing to pay out except usual bills, and it allows us to put a bit away for holidays and buying things etc etc and keeps us under the tax barrier so we pay no tax on it, need to look into that. We went to a financial advisor who sorted this out for us which I would advise you to do.

Obviously the pot goes down but it is enough to last us until we can get the state pension which in my case is 8 years time and the wife which is in 4 years time so what will happen then is the wife will get hers so we will then take less out of my pot each month so it will obviously last longer. Hope this makes sense and is a help, but strongly advise to get expert opinion before doing it ;)
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Thanks for that , I think you're right about consulting professional. Do you feel it's been the right move? Basically is having a bit less money better than the daily grind ?
 
I have a company pension worth £13000 per annum, an annuity of £3500 per annum, and state pension of £9700 per annum. The company one and the state are somewhat linked to inflation but the company one only up to 2.5%, the annuity not at all. I am reasonably well off.

I pay 20% tax on the entirety of the company one as the other two added make up my tax allowance.
 
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Griff7520 said:
I retired last October AT 60 and am taking £1223 per month in a draw down from a pension i took out in 1988 which was worth £120k this is not a lot but we have nothing to pay out except usual bills, and it allows us to put a bit away for holidays and buying things etc etc and keeps us under the tax barrier so we pay no tax on it, need to look into that. We went to a financial advisor who sorted this out for us which I would advise you to do.

Obviously the pot goes down but it is enough to last us until we can get the state pension which in my case is 8 years time and the wife which is in 4 years time so what will happen then is the wife will get hers so we will then take less out of my pot each month so it will obviously last longer. Hope this makes sense and is a help, but strongly advise to get expert opinion before doing it ;)
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Could you explain how £14,676 p.a. is under the tax barrier please?
 
newbiejim said:
I`m 61 in December, acutely aware of the egg timer running down :(. Awareness of being this age has just pretty recently been at the forefront of my consciousness. Consequently my thoughts are on retiring so I can have some years of being relatively fit and indulge the free time. Unfortunately I cant quite determine the balance of free time vs financial security (longer I work I get more pension, but less free time).

In short, how much per month would give a comfortable/non breadline existence (assuming no indulgent foreign holidays, pretty much just a regular existence, no mortgage to pay & circa £400 a month static outgoings.

My current thinking is £1500 a month, which is achievable for me. Is this reasonable?
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Don't be too comfortable, there's a horrific stat which shows morbidity shoots up when people stop working/don't keep sufficiently busy/tasked.
 
newbiejim said:
Thanks for that , I think you're right about consulting professional. Do you feel it's been the right move? Basically is having a bit less money better than the daily grind ?
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basically it was a decision made out off nessesty, it was not planned but to be honest its fantastic knowing you don't have to go to work everyday and can do what you want. I was having a few health issues what with covid etc etc and after 42 years as a cable maker i decided its time to go, we are not rich by any means but are comfortable....best decision I made ;)

Just plan it right and you will enjoy it ;)
 
Surveyor said:
Could you explain how £14,676 p.a. is under the tax barrier please?
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well the company that deals with my pension split the pot into 2 and I take so much from one and so much from the other pot i believe that is how they get round it...dont fully understand how it works but thats why the company deals with it and not me, I am useless with money so hired professionals to sort it out
 
FoxEye said:
Don't be too comfortable, there's a horrific stat which shows morbidity shoots up when people stop working/don't keep sufficiently busy/tasked.
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Indeed. I’m all for putting money away to live comfortably once you can retire, but it’s about how you retire and what you keep doing. No point having a boat load of cash to then do nothing but laze and holiday. Full time hobby springs to mind, or a charity, or something.
 
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