claymore
Well-Known Member
I think you need £1K per month to run the house, car, buy food
No savings in that but days out are covered within reason
Retirement
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I think you need £1K per month to run the house, car, buy food
No savings in that but days out are covered within reason
aquaplane
Well-Known Member
It depends on the boat and what you call living comfortably, £20,000 sounds a reasonable income in retirement for someone who has worked for average income. £46,000 to manage on untill the State Pension kicks in would be nice.
Sailfree
Well-Known Member
One aspect no mentioned is when you turn an enjoyable pastime into a job or your living style.
I started repairing cars when I was 20 and it developed into a enjoyable part time business but when I turned it into more of a full time business and 2 employees it was no longer enjoyable. It did finance my degree though when I went back to Uni at 25 married with 2 children! Once I qualified I preferred working as a Civil and Structural engineer and went back to part time car repairs for extra luxuries money.
We spoke about doing the ARC and sailing round the world and finally took 3 months off and went sailing in 2004 as a taster! We discovered we liked the sailing to go to places but not just the sailing. So decided no crossing Oceans for us. In 2004 we took 2 friend out for a sail at Cap Breton - they loved it and within a few years had bought a boat with almost zero experience and sailed off into the sunset on a fairly restricted budget. They cruised down to the Med and around the Med but after 2 years got fed up and now based back on land.
The point I am making is don't do something pleasurable to the extent you get bored or loose interest and then wonder what to do with the rest of your life.
Last two years we have sailed for 4 weeks in sunmmer and this year I am extending it to 6wks - I would like to believe it might develop into 3 - 4 months each summer but we will see. SWMBO has been going on cruises (Cunnard Style) with both mother and seperately with me and has commented that she is cruised out so thats a hint to me to consider the extent of summer sailing holidays to keep her interested. Point I am making is just because you think you want to spend lots of your life sailing if you have a partner also consider whether they will get bored but put up with it for your sake until they finally loath sailing - be careful.
WRT budgets I think if you lived exclusively on a boat you could live on £5 for every £100 you earn now. Think about it PAYE & NI takes 40%, VAT takes 20% then council tax , water rates, house repairs, utility bills, suits for work and extra taxes for TV licence and Fuel, commuting costs - I am sure you get the picture so if you break your ties you can live on very little. its keeping UK roots that costs unless you rent out the house.
I mention the above as food for thought.
For us we are going summer sailing, winter Cunnard style cruise, dinghy sailing holiday and backpacking plus maintaining and renting out a couple of properties. Will we have enough with pensions and savings? - I really don't know but suspect I will have to think about total expenditure where up to know I have not. Last few years I have concentrated on paying off mortgages, saving ISA's and buying new vehicle but get debt free so I have a distorted picture of what we need with everything paid for and taking pensions rather than paying into them. For us it starts I expect in July this year - be interesting in others experiences that are also starting on this next phase of their lives
Mention all the above to assist more rounded considerations so that you don't all think retirement + sailing = 100% happiness for rest of your life.
I started repairing cars when I was 20 and it developed into a enjoyable part time business but when I turned it into more of a full time business and 2 employees it was no longer enjoyable. It did finance my degree though when I went back to Uni at 25 married with 2 children! Once I qualified I preferred working as a Civil and Structural engineer and went back to part time car repairs for extra luxuries money.
We spoke about doing the ARC and sailing round the world and finally took 3 months off and went sailing in 2004 as a taster! We discovered we liked the sailing to go to places but not just the sailing. So decided no crossing Oceans for us. In 2004 we took 2 friend out for a sail at Cap Breton - they loved it and within a few years had bought a boat with almost zero experience and sailed off into the sunset on a fairly restricted budget. They cruised down to the Med and around the Med but after 2 years got fed up and now based back on land.
The point I am making is don't do something pleasurable to the extent you get bored or loose interest and then wonder what to do with the rest of your life.
Last two years we have sailed for 4 weeks in sunmmer and this year I am extending it to 6wks - I would like to believe it might develop into 3 - 4 months each summer but we will see. SWMBO has been going on cruises (Cunnard Style) with both mother and seperately with me and has commented that she is cruised out so thats a hint to me to consider the extent of summer sailing holidays to keep her interested. Point I am making is just because you think you want to spend lots of your life sailing if you have a partner also consider whether they will get bored but put up with it for your sake until they finally loath sailing - be careful.
WRT budgets I think if you lived exclusively on a boat you could live on £5 for every £100 you earn now. Think about it PAYE & NI takes 40%, VAT takes 20% then council tax , water rates, house repairs, utility bills, suits for work and extra taxes for TV licence and Fuel, commuting costs - I am sure you get the picture so if you break your ties you can live on very little. its keeping UK roots that costs unless you rent out the house.
I mention the above as food for thought.
For us we are going summer sailing, winter Cunnard style cruise, dinghy sailing holiday and backpacking plus maintaining and renting out a couple of properties. Will we have enough with pensions and savings? - I really don't know but suspect I will have to think about total expenditure where up to know I have not. Last few years I have concentrated on paying off mortgages, saving ISA's and buying new vehicle but get debt free so I have a distorted picture of what we need with everything paid for and taking pensions rather than paying into them. For us it starts I expect in July this year - be interesting in others experiences that are also starting on this next phase of their lives
Mention all the above to assist more rounded considerations so that you don't all think retirement + sailing = 100% happiness for rest of your life.
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PhillM
Well-Known Member
Sailfree, I think you make some very good points. A hobby should not become a job. What also strikes me is that you are using your money to start you off as a part-time landlord. That in itself is a job and needs to be managed like any other business. Overall you don't describe retirement, rather a change of working style - to one that delivers the finance you want to be able to live the way you want too. Good call
SimonD
Well-Known Member
There seems to be a number of themes in this discussion. Firstly, some people seem to need a job to answer the question: "why am I here?". A job makes them feel fulfilled, important, needed, whatever. I have friends who wouldn't retire simply because they would lose their sense of self-worth. That's not a criticism, just an observation. If you fall into this category, don't retire and if you do, look for some voluntary work, a chairmanship of something etc.
The second theme is money. In my experience, you can do all the calculations you like (and you should) but it won't tell you how much money you will actually spend in retirement. When I retired three years ago I was on a gross of around £57k; my pension is now around £25k and I don't feel any worse off. Part of this is saving commuting costs (of around £7k a year) paying off the mortgage and taking the boat out of a marina. But that doesn't account for all of it: I simply don't feel a need to spend money like I did.
The third theme is what you'll do with all that time. This makes me laugh. About 18 months into retirement, I took a part time job - two and a half days a week - to get some extra cash for a holiday. I've just had to cut this down to a day as it interferes with my life too much! If you are genuinely worried about what you'll do with your time in retirement, see my comments on the first theme!
Personally, I've never been happier than right now with less money and more time; less hassle and more fulfillment, less stress and more relaxation. I take to heart the words of W H Davies: "What is this life if, full of care, We have no time to stand and stare." If you don't need a job to define you and the money equation is not ridiculous, seize the day.
The second theme is money. In my experience, you can do all the calculations you like (and you should) but it won't tell you how much money you will actually spend in retirement. When I retired three years ago I was on a gross of around £57k; my pension is now around £25k and I don't feel any worse off. Part of this is saving commuting costs (of around £7k a year) paying off the mortgage and taking the boat out of a marina. But that doesn't account for all of it: I simply don't feel a need to spend money like I did.
The third theme is what you'll do with all that time. This makes me laugh. About 18 months into retirement, I took a part time job - two and a half days a week - to get some extra cash for a holiday. I've just had to cut this down to a day as it interferes with my life too much! If you are genuinely worried about what you'll do with your time in retirement, see my comments on the first theme!
Personally, I've never been happier than right now with less money and more time; less hassle and more fulfillment, less stress and more relaxation. I take to heart the words of W H Davies: "What is this life if, full of care, We have no time to stand and stare." If you don't need a job to define you and the money equation is not ridiculous, seize the day.
GrahamM376
Well-Known Member
I sold business and retired at 53. Downsized house, stopped running expensive cars, locked up and went sailing. Go back to check the house a couple of times a year for a few weeks. Home is in reality the boat for 9-10 months. 67 now so all pensions activated. For me, lack of clothing and other work related costs saved money (only have one suit now for b, m & deaths
) Not wealthy but have enough income to live on and everything we have is paid for. How much you need is impossible for others to calculate, too many different life styles. For instance not having a marina berth saves us around £5000 compared to many, we do eat out but go where the locals are avoiding seafront and marina restaurants. Do all my own boat maintenance.
) Not wealthy but have enough income to live on and everything we have is paid for. How much you need is impossible for others to calculate, too many different life styles. For instance not having a marina berth saves us around £5000 compared to many, we do eat out but go where the locals are avoiding seafront and marina restaurants. Do all my own boat maintenance.
jordanbasset
Well-Known Member
Myself and my wife 'retired' 4 years ago, living on my pension and BTL investments. We have had a fantastic time, initially living aboard our boat from the UK to Greece and then a few months in a caravan around the UK interspersed with winter in Spain. The memories have been wonderful and would not have traded them for anything. Out of the blue I have been offered a contract to work 2-3 years in the UAE, I am looking forward to it as it will be a new challenge but if it had not of come up there were many more things we wanted to do and hopefully will do in the future. It is a lot to do with the attitude people have to doing new things.
catmandoo
Well-Known Member
Well one thing to realise is that as you get older you continue to decay and an increasing rate . Bismark over a hundred years ago set retirement age as 65 knowing from statistics that those retiring had only 6 months to live on average . I remember when I was a boy in the 60s people used to keep black ties in their desks to attend the funerals of retired colleagues 6 months after they retired . Nowadays we are living much longer due to a better diet , cleaner living and better medical attention . However be prepared for the following after retirement , heart attack resulting in inclusion of a couple of stents , or a complete bypass plus a lot of pills and if you don't then change your life style diabeties , prostate cancer , , cancer of the bowel etc and if they detect any of them early then you get patched up by the medics in due course but keep on taking the pills as I had to do after my triple bypass . as long as you can still stand you can enjoy retirement until Altzheimers sneaks in and you forget who you are . So retire now and enjoy while you still can
Sybarite
Well-Known Member
I think long term sailing can be fun if you add a theme to it. eg In the Med, follow Ulysses' voyages. This leads you to research the voyage in advance in order to be able to recognize the different features. Or possibly it might be to catalogue as many different types of birds as possible.
Retired in Crete
Well-Known Member
If it is of any help this is what I did.
I retired aged 62 (wife was 57) in 2005. I sold our house in the UK, banked half the cash and with the rest bought a brand new two bedroomed bungalow on a mountainside in Crete with a view of the sea. It has a 25 sq.m swimming pool and a garden of 1,300 sq.m. We lived off the banked capital for 3 years until my pensions kicked in.
My current income is way below you quoted 20K GBP per year yet I have a 29ft yacht in the local marina (mooring fees 1300 Euros p.a.) and drive a 4 year old car which I bought new here. To give you a cost of living in Crete have a look at this: http://www.livingincrete.net/board/viewtopic.php?t=8094 which gives a comprehensive breakdown of costs. As the introduction says “Most couples do well on a figure between 11,000 and 18,000 Euros (9,166 and 15,000 GBP) per year”.
I have also overwintered in Bali and Thailand which, provided you stay for three months, is actually cheaper than staying here as the air fares are more than compensated for by the far lower living costs.
I used to enjoy working for a living but I have to say that being retired is the best job I have ever had!
John
Sailfree
Well-Known Member
John can you advise what you did for accomodation in Thailand please as that would interest SWMBO for winter months.
Thanks
bedouin
Well-Known Member
Of course with current annuity rates, to get an annuity pension of £20K for a couple at 55 (index linked) needs a pot of pretty much £1,000,000.
It is all very depressing
It is all very depressing
longjohnsilver
Well-Known Member
But that was yesterday's rules. Ok the actual changes come next year but if you're retiring now take what tax free cash you need from your pot and then use drawdown when necessary. A much better way of taking your pension, and as of next year all the fund is available to you.
mjcoon
Well-Known Member
But don't forget the tax; it's not really all available (IIRC). (Because taking it all out means it wasn't really a pension investment.)
Mike.
bedouin
Well-Known Member
Yes and no - taking it all out as a lump sum means you could be paying 50% of it back to the Government - so large capital withdrawals really don't make much sense.
So if your plans are to take enough out on retirement to get into the 40% tax bracket there is little reason to put it into the pension in the first place. Might as well take the money now - pay the 40% tax, and then let it grow in a lower cost environment (e.g. ISA)
rwoofer
Well-Known Member
Truly depressing. I thought I was doing well to get a quarter of that together by 45..........
[2574]
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I really can see there being a cap put on tax free withdrawals otherwise there'll be huge salary sacrifices in to the pension funds and then, if the pension holder is 55 years or older, an immediate tax free withdrawal of a quarter of that money thereby effectively reducing the marginal tax rate (of a higher rate taxpayer) to 30%; a useful saving.
I'm three years too young to take a lump sum but if I was 55 or more I think I'd be looking to take capital ASAP and then maximum reinvestment in ISA's (and maybe Premium Bonds as well). A very nice tax break whilst it lasts.
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longjohnsilver
Well-Known Member
Absolutely, that's exactly what I'll be doing in the next few years. A combination of TFC and withdrawals to remain under the 40% tax bracket. Should work out to be very tax efficient both for growth and income.
And don't forget that as of April 6 you're restricted to an annual contribution of 40K (currently 50K) and you can use unused allowance going back 3 years. So yes there's scope for largish contributions, but not huge in the overall scheme of things.
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bedouin
Well-Known Member
I thought the tax free sum was already limited - if not I am sure they will do.
Huge salary sacrifices are really not an option any more as they have imposed limits on the annual contribution.
Greg2
Well-Known Member
A fascinating thread! Very surprised to hear people talking about not being able to survive on a pension that is nearly twice average earnings and which many of our children may never achieve during their working lives.
I retired from a very demanding career a couple of years ago when I was just shy of fifty. Full pension and didn't have to work but I wasn't ready to stop as I need a challenge, just not the level of challenge I used to have. Rough plan is to work for a few years in a less demanding role linked to my boating interests with the objective of seeing our daughter though uni and masters and using the less demanding role as part of the glide path to doing less and eventually no paid work. Who knows how it will pan out and I will probably keep myself busy one way or the other but I am convinced that a gradual reduction is the way to go....just stopping can't be good for you and having a plan is probably essential.
I retired from a very demanding career a couple of years ago when I was just shy of fifty. Full pension and didn't have to work but I wasn't ready to stop as I need a challenge, just not the level of challenge I used to have. Rough plan is to work for a few years in a less demanding role linked to my boating interests with the objective of seeing our daughter though uni and masters and using the less demanding role as part of the glide path to doing less and eventually no paid work. Who knows how it will pan out and I will probably keep myself busy one way or the other but I am convinced that a gradual reduction is the way to go....just stopping can't be good for you and having a plan is probably essential.
