Retirement
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Change of career to something more sedentary and option?
I plan to die relatively early, plus a large group of muso's are going to pay me not to write my memoir ... other than that I'm fucked really !
Bit difficult, but talking to HR over last couple of years and they have been great to be honest. Hopefully in next few months we can plan year by year.RaymondLin said:Change of career to something more sedentary and option?
I reduced my hours at work with the intention that I’d keep it going for a few years but ended up doing 100% of the work for 60% of the salary (my manager might argue this point but it certainly made work harder). A lot will depend on the kind of work you do, if you are able to switch off when you finish your shift, but you should probably give it a try. We had a plasterer do some work on our house last year and he said he only did jobs that he thought were manageable on a part time basis as he was semi retired and had to learn to be good at saying No which I wasn’t good at doing.
I am retired but my finances not as well sorted as they could be. If I was guaranteed to live to 90 I’d have carried on for a few more years and put more money in the bank but my oldest brother was dead before retirement age, my other brother forced to retire due to ill health and my sister retried and minted but barely able to walk so whilst I’m still in rude health I shall be spending the kid’s inheritance and take my chances with the state pension.
I am retired but my finances not as well sorted as they could be. If I was guaranteed to live to 90 I’d have carried on for a few more years and put more money in the bank but my oldest brother was dead before retirement age, my other brother forced to retire due to ill health and my sister retried and minted but barely able to walk so whilst I’m still in rude health I shall be spending the kid’s inheritance and take my chances with the state pension.
Ask whoever runs your work pension plan for illustrations of what a reduced pension might look like.
Our Maud did this (she worked in the electricity industry for 18 years). She asked for what it would look like if she retired at 60, 62, and 64 - she was pleasantly surprised to find that the difference between 60 and 64 was so little it made hardly any difference, so not worth doing the extra 4 years' slog.
Our Maud did this (she worked in the electricity industry for 18 years). She asked for what it would look like if she retired at 60, 62, and 64 - she was pleasantly surprised to find that the difference between 60 and 64 was so little it made hardly any difference, so not worth doing the extra 4 years' slog.
I'll be working until I die at my desk.
The only chance I have at retirement is a lottery win or I discover that I have a long lost relative who owns an oil field or something.
The only chance I have at retirement is a lottery win or I discover that I have a long lost relative who owns an oil field or something.
I fully intend to die at my job as well, gonna be a sucky day for any passengers I have on board.
I've recently retired at 57 and while everyone's circumstances are different, you can live on a fair bit less without the "cost" of working.
Our post-tax income when we both worked was around 75% more than our retirement income. With mortgage paid off (I'd been overpaying for around 5 years to get that down as low as possible and our remaining bit was pretty small c £30k so that was repaid from lump sum) and reduced commuting costs / coffees / lunches / clothing etc as well as no longer having to contribute to pension, I'm been relieved that my projections of our requirements were pretty accurate and we're comfortable. We'd no other debt except for car finance (which I continue to pay)
Definitely get pension illustrations from your provider(s) and work out a budget that you can live on. Factor in that you may only need to make any tax free lump sum last for five years until your state pension kicks in and makes up the difference etc.
Better to know the exact position - whether good or bad - than worry about it because you don't know.
Our post-tax income when we both worked was around 75% more than our retirement income. With mortgage paid off (I'd been overpaying for around 5 years to get that down as low as possible and our remaining bit was pretty small c £30k so that was repaid from lump sum) and reduced commuting costs / coffees / lunches / clothing etc as well as no longer having to contribute to pension, I'm been relieved that my projections of our requirements were pretty accurate and we're comfortable. We'd no other debt except for car finance (which I continue to pay)
Definitely get pension illustrations from your provider(s) and work out a budget that you can live on. Factor in that you may only need to make any tax free lump sum last for five years until your state pension kicks in and makes up the difference etc.
Better to know the exact position - whether good or bad - than worry about it because you don't know.
As @Chuffola has wisely pointed out, it costs suprisingly less to live in retirement than you'd ever imagined. I never realised how much it cost me to actually go to work until I didn't need to pay it any more.
Chuffola said:I've recently retired at 57 and while everyone's circumstances are different, you can live on a fair bit less without the "cost" of working.
I'm not disagreeing, but as noted it depends on individual circumstances. At 60 I now get free travel in London, and I don't buy lunches or coffees - in fact by going into the office I get all the free coffee and tea I can drink, plus heating and a desk/chair setup much more comfortable than what I have at home. So I don't think work costs me anything other than time. And stress...Grampa said:As @Chuffola has wisely pointed out, it costs suprisingly less to live in retirement than you'd ever imagined. I never realised how much it cost me to actually go to work until I didn't need to pay it any more.
I’m in my 40s, I work in the public sector. I have a final salary pension scheme from when I started working. I’ve done nearly 20 years and I have a lump sum of 20 quid. I fuck you not. My final salary scheme closed, I was moved to the new scheme 2 weeks into my employment and it changed career average. My pay rises have been about 0.5% averaged out over the time I’ve worked for them. Promotion doesn’t exist as they just delete posts and don’t recruit when people leave.
I logged into our HR system a few weeks ago. They had added 4 years to my retirement age. 68 for my “full” pension now. Even then I’ll be lucky if I get 10k a year.
It’s been a race to the bottom with pensions and I get really pissed off with people of a certain age saying that “government pensions” are gold plated. They aren’t. They are shit.
I’ve also paid a private pension since I was 18. It’s not enough to make up the difference. I expect to work till I die. I don’t expect any state pension to exist when I get to my 60s. Maybe get one if I get to 75.
Anyway, back to the OP, I helped a colleague sort her pension recently. She’s only got 5 years more service than I have but as she was the old scheme and because of the luck of being a boomer she can go at 62 without much of a hit. Works out well for her. Ask for a statement and go from there there.
You might be surprised.
Edit: sorry this wasn’t meant to sound as grumpy or dickish as it might have. I hope you get it sorted. My point was more than no-one should have to work indefinitely doing something that’s physically hard or mentally taxing.
I've watched my pension arrangements be slowly eroded every time I switched job. I had a great pension when I originally moved to the public sector but my team was compulsorily transferred to another public body under TUPE and we were forced to switch pensions. We lost the employer contributions in the new pension that made the original pension so good regardless of whether we stuck with the old one or not. Likewise in the private sector the pension benefits used to sell the package were actually hoovered up by administration fees and my salary hadn't increased from 2007-2013. Luckily I don't live in the UK now so could possibly get away with living on even less with the help of side gigs. Maybe it might be possible to take on my mother in laws business and pay someone to manage it for me because if I get sick I'm screwed.Penn said:I’m in my 40s, I work in the public sector. I have a final salary pension scheme from when I started working. I’ve done nearly 20 years and I have a lump sum of 20 quid. I fuck you not. My final salary scheme closed, I was moved to the new scheme 2 weeks into my employment and it changed career average. My pay rises have been about 0.5% averaged out over the time I’ve worked for them. Promotion doesn’t exist as they just delete posts and don’t recruit when people leave.
I’m in the fortunate position at 60 of having enough money to last me for the rest of my life - as long as I die by New Year’s Eve.
Do you own your house? Is there a possibility of downsizing/moving to a cheaper area to free up some capital? You are allowed to top up private pensions to the max allowance of 60k for the last 3 years and get the tax back. So say you can free up £180k. You can put £180k into a private pension and get £36k back.
More if you are on a higher tax rate.
Are there managerial/clerical roles available where you work? Could you do teaching in your field of expertise?
More if you are on a higher tax rate.
Are there managerial/clerical roles available where you work? Could you do teaching in your field of expertise?
If you have to keep working ask your company if you could adopt a training or mentoring role for young or new employees, put your experience to use and get off the front line a bit and maybe plan to phase into reduced hours over time.koneguitarist said:Bit difficult, but talking to HR over last couple of years and they have been great to be honest. Hopefully in next few months we can plan year by year.RaymondLin said:Change of career to something more sedentary and option?
Also, take a long hard look at your annual living costs and see if there is any room to trim back without too much lifestyle compromise.
This is why I keep banging on to my kids, life is like a train track and when you are young it looks like it stretches on for miles into the distance and over the horizon, but, at the other of the track is the older you walking towards you and one day they will pop into view and get closer and closer each day. When you eventually meet up older you will say one of two things to you. Either, “thanks for making an effort and looking after me all these years” or “why didn't you look after me and what do you expect me to do now?”
I also tell them about the magic money time machine. My daughter commented once that the £40 a month she and her employer was paying into her pension was hardly worth it.
So, I showed her what the real value of that money was by demonstrating that she should not view it in todays value but rather in what each pound is worth after a working lifetime of compounding gains when invested sensibly via the magic money time machine.
I opened a spreadsheet and demonstrated that £1 invested today in a global equity index fund compounding at say 9% a year for 35 years is actually worth £20.41, so, her £40 a month is £816 a month in terms of future value, so she is actually buying herself nearly £10K of future value a year even with her small contribution. A bucket will fill from a dripping tap if you are patient.
Caveat is inflation eroding some of that buying power but still the point was made and off she went satisfied and vowed to keep saving, even just a little and invest money. Now, if only my son would listen…
Axe_meister said:
You are allowed to top up private pensions to the max allowance of 60k for the last 3 years and get the tax back.
Careful! That’s only if he is earning at least 60k per year. You can contribute up to 100% of your salary into a pension below an annual wage of 60k a year. Anyone earning higher than that is limited to a 60k annual contribution.
I.e. Someone earning 35k per year can contribute 35k max per year to a pension. If you’re earning a 100k salary you can “only” contribute 60k
I.e. Someone earning 35k per year can contribute 35k max per year to a pension. If you’re earning a 100k salary you can “only” contribute 60k
That's not correct either.Majorscale said:Axe_meister said:
You are allowed to top up private pensions to the max allowance of 60k for the last 3 years and get the tax back.Careful! That’s only if he is earning at least 60k per year. You can contribute up to 100% of your salary into a pension below an annual wage of 60k a year. Anyone earning higher than that is limited to a 60k annual contribution.
I.e. Someone earning 35k per year can contribute 35k max per year to a pension. If you’re earning a 100k salary you can “only” contribute 60k
You can't salary sacrifice 100% of your salary, you have to keep your salary, after salary sacrifice pension payments, at or above the national minimum wage or national living wage if aged over 23.
Someone with pension carry forward of unused allowance from the last 3 years can pay extra in but must earn at least the amount they want to contribute.
Grampa said:As @Chuffola has wisely pointed out, it costs suprisingly less to live in retirement than you'd ever imagined. I never realised how much it cost me to actually go to work until I didn't need to pay it any more.
I'll try to dig out one of my pre-retirement spreadsheets, where I was trying to predict what my post retirement spending would be, and compare it to the reality five years down the line.
What I do know is that I got it wrong, but in a good way. Even allowing for inflation, which has been much higher than I'd predicted, I'm not burning through the cash at the rate that I'd planned.
61 and I can't see myself retiring. I have 3 grown up kids at home, at least one of which will never move out, and the other looking unlikely at the moment (both autism based). Need to keep the money coming in, none of this easy life business for me.
That cheered me up @richardhomer . Although I'm a bit worried that you were up at 5.30am. To me 5.30am is something that only exists as a theoretical concept because the hands of the clock have to pass through it to get to more reasonable hours.richardhomer said:I’m in the fortunate position at 60 of having enough money to last me for the rest of my life - as long as I die by New Year’s Eve.
Insomnia is very much a thing for me…Philly_Q said:That cheered me up @richardhomer . Although I'm a bit worried that you were up at 5.30am. To me 5.30am is something that only exists as a theoretical concept because the hands of the clock have to pass through it to get to more reasonable hours.richardhomer said:I’m in the fortunate position at 60 of having enough money to last me for the rest of my life - as long as I die by New Year’s Eve.
Luckily I am fully paid up on NI payments after checking online earlier.
But still wouldn’t be able to access that until 2029, my works pension I won’t be able to draw on for a few years either. May try and cut my hours to a 4 day week and see how I go in 2025.
May win the lottery! 4.5 years to go at maximum.
I've found retirement to be very satisfying. It is, indeed, true that you need far less money to get by once you reach State Pension age (so long as there are two of you) plus a modest private pension.
In terms of the “end of life” thing, this definitely causes some hard thinking although I've found that as your body starts to wind down you begin to see it as a natural part of your existence. Picking up various medical complications also highlights the fact that you are not immortal and you stop pretending that you are. The management of your health becomes a sort of hobby and is a bit of a challenge, in a good way. Of utmost importance is to enhance your mood so stop watching the news, which is, of course, designed to scare you, and maybe take a supplement like Vitamin D, which I found to be quite effective. Get outdoors. Idleness will breed dark thoughts.
As for retirement planning, just remember that all those pension tax breaks inevitably have to get paid back (at least in part) when you start dipping in to it and, also, your remaining pension pot will no longer be free of IHT (for those lucky ones in society).Also choose your provider carefully, which I didn't, by speaking to friends about their personal experiences.
Otherwise, treat retirement/old age as the most interesting, challenging and rewarding stage of life.
nb. Post edited to remove unwarranted comments re pension providers.
@Humboldt Could you be more specific with this comment? Which providers and what did they do?Humboldt said:I've found retirement to be very satisfying. It is, indeed, true that you need far less money to get by once you reach State Pension age (so long as there are two of you) plus a modest private pension.
In terms of the “end of life” thing, this definitely causes some hard thinking although I've found that as your body starts to wind down you begin to see it as a natural part of your existence. Picking up various medical complications also highlights the fact that you are not immortal and you stop pretending that you are. The management of your health becomes a sort of hobby and is a bit of a challenge, in a good way. Of utmost importance is to enhance your mood so stop watching the news, which is, of course, designed to scare you, and maybe take a supplement like Vitamin D, which I found to be quite effective. Get outdoors. Idleness will breed dark thoughts.
As for retirement planning, just remember that all those pension tax breaks inevitably have to get paid back (at least in part) when you start dipping in to it and, also, your remaining pension pot will no longer be free of IHT (for those lucky ones in society). And be aware that the well known pension providers can be particularly profligate with your money, as I have witnessed, so choose your provider carefully, which I didn't, by speaking to friends about their personal experiences.
Otherwise, treat retirement/old age as the most interesting, challenging and rewarding stage of life.
Just that they always seem to have the fanciest offices etc.RandallFlagg said:@Humboldt Could you be more specific with this comment? Which providers and what did they do?Humboldt said:I've found retirement to be very satisfying. It is, indeed, true that you need far less money to get by once you reach State Pension age (so long as there are two of you) plus a modest private pension.
In terms of the “end of life” thing, this definitely causes some hard thinking although I've found that as your body starts to wind down you begin to see it as a natural part of your existence. Picking up various medical complications also highlights the fact that you are not immortal and you stop pretending that you are. The management of your health becomes a sort of hobby and is a bit of a challenge, in a good way. Of utmost importance is to enhance your mood so stop watching the news, which is, of course, designed to scare you, and maybe take a supplement like Vitamin D, which I found to be quite effective. Get outdoors. Idleness will breed dark thoughts.
As for retirement planning, just remember that all those pension tax breaks inevitably have to get paid back (at least in part) when you start dipping in to it and, also, your remaining pension pot will no longer be free of IHT (for those lucky ones in society). And be aware that the well known pension providers can be particularly profligate with your money, as I have witnessed, so choose your provider carefully, which I didn't, by speaking to friends about their personal experiences.
Otherwise, treat retirement/old age as the most interesting, challenging and rewarding stage of life.
I'm quite happy to accept that I was exaggerating. They're not the only businesses to act in this way.
I've edited my post accordingly.
You’re right, you can’t salary sacrifice 100% of your salary due to minimum wage but you can pay 100% of your income to a pension.RandallFlagg said:That's not correct either.Majorscale said:Axe_meister said:
You are allowed to top up private pensions to the max allowance of 60k for the last 3 years and get the tax back.Careful! That’s only if he is earning at least 60k per year. You can contribute up to 100% of your salary into a pension below an annual wage of 60k a year. Anyone earning higher than that is limited to a 60k annual contribution.
I.e. Someone earning 35k per year can contribute 35k max per year to a pension. If you’re earning a 100k salary you can “only” contribute 60k
You can't salary sacrifice 100% of your salary, you have to keep your salary, after salary sacrifice pension payments, at or above the national minimum wage or national living wage if aged over 23.
Someone with pension carry forward of unused allowance from the last 3 years can pay extra in but must earn at least the amount they want to contribute.
So, if someone is on £40k and the minimum wage is 12k (I’m just using round figures) you could salary sacrifice £28k and pay £12k gross into a private pension.
In terms of the op, you need to figure out first of all what you need to live on (realistically- people are very unrealistic when they calculate their expenditure). Get a state pension forecast, figure out how short you are. Get an annuity quote to give you an idea of what your private pension is worth. Use https://www.moneyhelper.org.uk/en/pensions-and-retirement/taking-your-pension/compare-annuities
That’ll give you an idea of your lifetime income. If you’ve got enough, you’ll need enough in savings for every year before you get your state pension to bridge the gap.
There are tonnes of other ways to skin the cat, which is why financial advisers exist, but it’ll give you a starting point.
Just to briefly mention the person moaning about government pensions- you think you’ve got it bad, you’re getting a pension where circa 30% of your salary is being paid in. Try being in the private sector or self employed.
That’ll give you an idea of your lifetime income. If you’ve got enough, you’ll need enough in savings for every year before you get your state pension to bridge the gap.
There are tonnes of other ways to skin the cat, which is why financial advisers exist, but it’ll give you a starting point.
Just to briefly mention the person moaning about government pensions- you think you’ve got it bad, you’re getting a pension where circa 30% of your salary is being paid in. Try being in the private sector or self employed.
I'm 57 with 34 years in a local government pension scheme and can now afford to pay in to a salary sacrifice based additional voluntary contribution scheme. I am very lucky.
I feel like I've entered in to a bit of a career twilight zone, in that motivation has ebbed away, but I need to do a few more years - maybe aim for 60? I'd like to speak to a financial advisor, but have struggled to find one. I've tried Unbiased twice, but no-one interested, I think because I'm looking for defined benefit scheme advice.
I really think it's easier to find an FA via a personal recommendation.
I feel like I've entered in to a bit of a career twilight zone, in that motivation has ebbed away, but I need to do a few more years - maybe aim for 60? I'd like to speak to a financial advisor, but have struggled to find one. I've tried Unbiased twice, but no-one interested, I think because I'm looking for defined benefit scheme advice.
I really think it's easier to find an FA via a personal recommendation.
There are 3 types of financial adviserewal said:I'm 57 with 34 years in a local government pension scheme and can now afford to pay in to a salary sacrifice based additional voluntary contribution scheme. I am very lucky.
I feel like I've entered in to a bit of a career twilight zone, in that motivation has ebbed away, but I need to do a few more years - maybe aim for 60? I'd like to speak to a financial advisor, but have struggled to find one. I've tried Unbiased twice, but no-one interested, I think because I'm looking for defined benefit scheme advice.
I really think it's easier to find an FA via a personal recommendation.
1) Someone tied to an insurance firm or fund manager. St James Place are the largest example. Their job is to sell you their products.
2) An IFA who is whole of market, but whilst not allowed from a regulatory point of view, they’ll have some bias, generally due to links with fund manager or insurance firm. Quilter are probably the biggest example - IFA but with incentives to sell Quilter products.
3) Genuine IFA. They’ll have options to pay by the hour and will be able to help.
The issue with genuine IFA by the hour is there is often a disconnect between what the public will think advice costs and what it actually does, due to the cost of regulation. Because categories 1 & 2 exist, a customer will right ask why they’re going to pay thousands to be sold a product. By the hour advice is less profitable, but if you’re prepared to pay somewhere between £250-300 plus VAT per hour, you’ll find someone. Expect to budget for at least 10 hours work as cashflow models and the regulatory paperwork required will be a decent chunk of time and therefore cost.
3) Genuine IFA. They’ll have options to pay by the hour and will be able to help.
The issue with genuine IFA by the hour is there is often a disconnect between what the public will think advice costs and what it actually does, due to the cost of regulation. Because categories 1 & 2 exist, a customer will right ask why they’re going to pay thousands to be sold a product. By the hour advice is less profitable, but if you’re prepared to pay somewhere between £250-300 plus VAT per hour, you’ll find someone. Expect to budget for at least 10 hours work as cashflow models and the regulatory paperwork required will be a decent chunk of time and therefore cost.
Once upon a time there used to be local government pension roadshows and you could get quite a lot of advice. I don't think they've existed for many years though.chris78 said:There are 3 types of financial adviserewal said:I'm 57 with 34 years in a local government pension scheme and can now afford to pay in to a salary sacrifice based additional voluntary contribution scheme. I am very lucky.
I feel like I've entered in to a bit of a career twilight zone, in that motivation has ebbed away, but I need to do a few more years - maybe aim for 60? I'd like to speak to a financial advisor, but have struggled to find one. I've tried Unbiased twice, but no-one interested, I think because I'm looking for defined benefit scheme advice.
I really think it's easier to find an FA via a personal recommendation.
1) Someone tied to an insurance firm or fund manager. St James Place are the largest example. Their job is to sell you their products.2) An IFA who is whole of market, but whilst not allowed from a regulatory point of view, they’ll have some bias, generally due to links with fund manager or insurance firm. Quilter are probably the biggest example - IFA but with incentives to sell Quilter products.
3) Genuine IFA. They’ll have options to pay by the hour and will be able to help.
The issue with genuine IFA by the hour is there is often a disconnect between what the public will think advice costs and what it actually does, due to the cost of regulation. Because categories 1 & 2 exist, a customer will right ask why they’re going to pay thousands to be sold a product. By the hour advice is less profitable, but if you’re prepared to pay somewhere between £250-300 plus VAT per hour, you’ll find someone. Expect to budget for at least 10 hours work as cashflow models and the regulatory paperwork required will be a decent chunk of time and therefore cost.
The bulk of my local government pension scheme was with Manchester (I never worked there just what was decided on my behalf)and they weren't very helpful. I have a few years in a separate scheme run by Worcestershire and this is smaller and you can speak to people and get options. Obviously they don't help with overall financial planning but in terms of the pension really helpful. So depending on what scheme you are in you might be able to get some limited free advice from yours. The CAB run (or ran anyway) pension planning surgeries but again won't touch local government schemes with a bargepole.
Belated thanks for the advice.
My LG pension management organisation doesn't provide advice. I'll have another look about in the new year.
My LG pension management organisation doesn't provide advice. I'll have another look about in the new year.
i am an engineer, working at height and at times heavy work.
So my company have been very understanding and realise that I have to be managed if I want to last.