early retirement survive on 1.5k a month yes of no?

mark123

boogieman said:

RandallFlagg said:

jonnyburgo said:

£1500 is roughly what you'd take home if you were earning 24k a year, I'd say go for it. Piece of piece to live on that much if no debts. If you've worked all your life, Not sure how it will affect state pension which is currently around £700 a month fully paid up.

If you have 35 years full NIC contributions then you get full state pension, you can check this on the government website here https://www.gov.uk/check-national-insurance-record

Just because you’ve contributed 35 years of NI there’s no guarantee that you’ll still get a full state pension. There are a few factors that affect the final amount: a) if you’ve ever had your work pension contracted out and b) how early you take retirement (unless you do part time work you’ll end up with empty NI contribution years which ultimately reduce your pension). I’ve got 42 years of NI in but still only qualify for a reduced amount due to a & b. Also don’t forget that state pension is taxable. Keep checking the gov website: the closer you get to pensionable age the more accurate the forecast, but please don’t rely on getting the full whack just because you’ve paid 35 years in.  

hi sorry to disagree  but ive been on the phone to them i have 35yrs contribution as it stands if i take redundancy now (54) and dont work a day till i'm 67 i have enough yrs contribution to entitle me to 100% state pension,it getting the 35yrs  in before you are 67 that counts,you can stop/start /stop /start but as long as the 35yrs worth are in you will get 100%, 

Kittyfrisk

^ Exactly what what I was informed.

My situation was that although I was with the LGPS for the majority of my working life, as the pension scheme was partially 'opted out', this means that I don't qualify for a full state pension.
But... a) this only matters if I'm still alive. b) I'm doing fine on the LGPS pension at the moment c) I can buy the 'missing' contributions ifI want a full pension.
The problem is, I'd have to live for so much longer before I would recover the value of the additional contributions, so it simply is not worth it in my case. YMMV.

Strat_a_tat_tat

mark123 said:

boogieman said:

RandallFlagg said:

jonnyburgo said:

£1500 is roughly what you'd take home if you were earning 24k a year, I'd say go for it. Piece of piece to live on that much if no debts. If you've worked all your life, Not sure how it will affect state pension which is currently around £700 a month fully paid up.

If you have 35 years full NIC contributions then you get full state pension, you can check this on the government website here https://www.gov.uk/check-national-insurance-record

Just because you’ve contributed 35 years of NI there’s no guarantee that you’ll still get a full state pension. There are a few factors that affect the final amount: a) if you’ve ever had your work pension contracted out and b) how early you take retirement (unless you do part time work you’ll end up with empty NI contribution years which ultimately reduce your pension). I’ve got 42 years of NI in but still only qualify for a reduced amount due to a & b. Also don’t forget that state pension is taxable. Keep checking the gov website: the closer you get to pensionable age the more accurate the forecast, but please don’t rely on getting the full whack just because you’ve paid 35 years in.  

hi sorry to disagree  but ive been on the phone to them i have 35yrs contribution as it stands if i take redundancy now (54) and dont work a day till i'm 67 i have enough yrs contribution to entitle me to 100% state pension,it getting the 35yrs  in before you are 67 that counts,you can stop/start /stop /start but as long as the 35yrs worth are in you will get 100%, 

In that case, I'm guessing you were never contracted out.
I have more than 35 yrs of full NI contributions... but I still have to add a few more years in order to get the full pension (under the new, 35 yr scheme). I think this is because I may have been contracted out for a few years in the past.  So I think @boogieman 's point 'a' is correct. However, I don't understand his point 'b'.  I was under the impression that if one has got 35 yrs of full contributions - without any yrs contracted out - one qualifies for the full pension (under the new scheme) regardless of whether you give up work early or not.

HAL9000

In the OP's position, rather than retire I'd be incrementally cutting my hours at work over the next two or three years. That way I'd still be putting something in the pension pot, freeing up some spare time to do the things I want to do, and finding out if I'm really ready to give up work just yet. 

The OP says he'd be getting state pension at 67 - I'm happy to be corrected but if he's 54 now won't his state pension age be 68?

Kittyfrisk

HAL9000 said:

In the OP's position, rather than retire I'd be incrementally cutting my hours at work over the next two or three years. That way I'd still be putting something in the pension pot, freeing up some spare time to do the things I want to do, and finding out if I'm really ready to give up work just yet. 

The OP says he'd be getting state pension at 67 - I'm happy to be corrected but if he's 54 now won't his state pension age be 68?

Depends what happens over the next couple of years in England, could even be 78 

rlw

Will £1500 be enough in ten years time?

ronnyb

I retired on a full pension at 51. I used my lump sum together with some savings and bought a small house which we rent out. I spent about 18 months doing a gardening round for pensioners that were friends of my mother in law. I'm not the type to go golfing or fishing etc, my only real interest is guitars and music and saw a casual job with a government organisation advertised in the local newspaper. 12 years later and i'm still doing it. I probably work on average between 8 to 10 days a month and sometimes it's quite physically and mentally demanding. It keeps me fit and i cycle to and from work. I don't think i'd be happy if i had every day off, i'd get bored and i definitely think you need a purpose in life. I don't really need the extra money, i don't have an expensive lifestyle and have pretty much all the guitars i want. One day i'll say i'll fully retire but it's not yet.   

RandallFlagg

rlw said:

Will £1500 be enough in ten years time?

You're right, it won't. In my plan I have a spreadsheet that inflates the amount I plan to drawdown each year to keep up with inflation.

Kittyfrisk

@mark123 ;  
Is it by any chance an LGPS scheme that you are in, or a private type?

For the others in this conversation, if it is an LGPS scheme, then this offers full index linking to pension benefits i.e. there is no upper limit or capping on the amount by which benefits will be increased in times of high inflation.

Iamnobody

Only you know the answer. My own opinion on retirement is when you can afford to, do it.

Then take a part time job that’s rewarding but not necessarily highly paid.

Thats my own plan...

There are lots of people who have to live on that and less and pay a mortgage and bills, bring up kids etc so if you cut your cloth accordingly £1.5k/month is pretty decent if you ask me.

Strat_a_tat_tat

Kittyfrisk said:

@mark123 ;  
Is it by any chance an LGPS scheme that you are in, or a private type?

For the others in this conversation, if it is an LGPS scheme, then this offers full index linking to pension benefits i.e. there is no upper limit or capping on the amount by which benefits will be increased in times of high inflation.

Wow... full index linking!  The benefits of a public sector pension!  ;-)

Barney

Im thinking of finishing in the next 2 years...or possibly 3 day week ...iff the company will allow that ...im going to use drawdown on my pension i think until im 67 and can get state pension ...im thinking i wont need a lot at that age ...I have no debts and house is paid ..so iff i am short of money i will get a part time job... dunno off I am right in thinking you can draw £1200 tax free free a year from your pension ?...
Plus will have a few guitars that I will be selling

Strat_a_tat_tat

Barney said:

Im thinking of finishing in the next 2 years...or possibly 3 day week ...iff the company will allow that ...im going to use drawdown on my pension i think until im 67 and can get state pension ...im thinking i wont need a lot at that age ...I have no debts and house is paid ..so iff i am short of money i will get a part time job... dunno off I am right in thinking you can draw £1200 tax free free a year from your pension ?...
Plus will have a few guitars that I will be selling

Not sure about £1,200pa as a blanket rule. Not heard that one.

You can take out 25% of the value of the pension... without paying tax.  You can either do that in one lump, or I think you can take it in stages (not sure of the details).  Other monies you take out of your pension will be subject to income tax (along with pretty much any other income you have)... but the first £12,500 of income per annum is exempt from income tax.

Barney

Strat_a_tat_tat said:

Barney said:

Im thinking of finishing in the next 2 years...or possibly 3 day week ...iff the company will allow that ...im going to use drawdown on my pension i think until im 67 and can get state pension ...im thinking i wont need a lot at that age ...I have no debts and house is paid ..so iff i am short of money i will get a part time job... dunno off I am right in thinking you can draw £1200 tax free free a year from your pension ?...
Plus will have a few guitars that I will be selling

Not sure about £1,200pa as a blanket rule. Not heard that one.

but the first £12,500 of income per annum is exempt from income tax.

So does this mean £12,500 can be took tax free through drawdown ?...im not sure cos i havnt looked into it really ..but I just assumed..maybe wrongly that you are allowed £12.500 a year tax free as you are with any wage ...everything above that you pay normal tax on.... i might be totally wrong though 

HAL9000

Barney said:

... dunno off I am right in thinking you can draw £1200 tax free free a year from your pension ?...

My understanding is that 25% of your pension fund can be taken tax free. After that it's taxed the same as any other income.

So, if you were to take 25% of your pension pot in year one then that would be tax free. Anything taken in year two would then be taxed just like any other income. I don't think the £1200 p.a. tax-free  you mentioned can be right (unless it's the amount required to bring your total income up to the tax threshold).

Strat_a_tat_tat

Barney said:

Strat_a_tat_tat said:

Barney said:

Im thinking of finishing in the next 2 years...or possibly 3 day week ...iff the company will allow that ...im going to use drawdown on my pension i think until im 67 and can get state pension ...im thinking i wont need a lot at that age ...I have no debts and house is paid ..so iff i am short of money i will get a part time job... dunno off I am right in thinking you can draw £1200 tax free free a year from your pension ?...
Plus will have a few guitars that I will be selling

Not sure about £1,200pa as a blanket rule. Not heard that one.

but the first £12,500 of income per annum is exempt from income tax.

So does this mean £12,500 can be took tax free through drawdown ?...im not sure cos i havnt looked into it really ..but I just assumed..maybe wrongly that you are allowed £12.500 a year tax free as you are with any wage ...everything above that you pay normal tax on.... i might be totally wrong though 

I think, generally, if you've got no other income... you could take £12,500 a year out of your pension and not have to pay tax ( I say generally because the taxman does also allow people to earn a small amount from hobbies or renting a room out. Not sure how much... but it's quite a small amount like £1k per annum maybe).

But remember, you can also take 25% out of your pension tax free (either as a lump or spread over multiple payments). I'm thinking I'd probably take the 25% out in one go... and then invest it (or spend it on guitars!).

GoldenEraGuitars

mark123 said:

 I'm 54 no mortgage, car paid for, no debt, no kids ,pension adviser said i would easily have 1.5k a month to live off ,basic outgoings inc food fuel gas leccy poll tax water £800 .

I just read this again.... £800 on utilities, food and fuel? Just to compare, our mortgage, utilities, phone contracts, rates, insurances, car payments, broadband, tv licence, heat, fuel and half the food for a family of 5 is less than this. Can you trim that £800 down? 

Kittyfrisk

Strat_a_tat_tat said:

Kittyfrisk said:

@mark123 ;;  
Is it by any chance an LGPS scheme that you are in, or a private type?

For the others in this conversation, if it is an LGPS scheme, then this offers full index linking to pension benefits i.e. there is no upper limit or capping on the amount by which benefits will be increased in times of high inflation.

Wow... full index linking!  The benefits of a public sector pension!  ;-)

Yes, that's true. How very fucking hilarious!! 
I was present at the last gasp of the now much villified 'public sector pension' that was designed to protect it's members in retirement & look after the interests of the majority of it's contributors.
This was the aspirational gold standard for years & it worked well, but apparently it was really a terrible communist plot.  * need new emoji for really fucking angry* 
There were many of us that worked steadily for low wages for years while paying generously into the system for all the right reasons.
I know lots of people that in the late 90's & early 00's that were persuaded to move out of the LGPS by Thatcher's wide boy sharks with promises of higher gains & sunny uplands.
They all without exception ended up poorer & pissed off.  But that's greed for you * shrug* So, excuse me if I don't cry too many crocodile tears for those that abandoned the idea of a common good, for personal betterment. 
Nor am I basking in smug assurance. I'm incredibly sorry for all those that had the ladder pulled up in front of their faces & I don't want it to be repeated. Same goes for access to housing, benefits etc.

Strat_a_tat_tat

Kittyfrisk said:

Strat_a_tat_tat said:

Kittyfrisk said:

@mark123 ;;  
Is it by any chance an LGPS scheme that you are in, or a private type?

For the others in this conversation, if it is an LGPS scheme, then this offers full index linking to pension benefits i.e. there is no upper limit or capping on the amount by which benefits will be increased in times of high inflation.

Wow... full index linking!  The benefits of a public sector pension!  ;-)

Yes, that's true. How very fucking hilarious!! 

Forgive me if I'm missing something... but your comment seems a bit harsh!
Not everyone gets to enjoy an index linked pension... despite years of making large contributions. 
There aren't many final salary pensions left in the private sector... and I've never known of an index linked final salary pension in the private sector (ever).  So I'm not sure who you're angry with here.

Kittyfrisk

I said 'I was present at the last gasp of the now much villified 'public sector pension' that was designed to protect it's members in retirement & look after the interests of the majority of it's contributors.'
And "Nor am I basking in smug assurance. I'm incredibly sorry for all those that had the ladder pulled up in front of their faces & I don't want it to be repeated. Same goes for access to housing, benefits etc.'

I'm not angry at you or any individual. Sorry if it appeared that way.
I am however really, really angry at politicians over the last 40 years that have nodded through changes that systematically impoverish the majority whilst protecting & favouring the wealthy.