Like many people in the UK I've been gradually stacking wealth for several years now, in the form of diversified investments including the good old pension.
For pretty much all of my life, i've used my income to increase my wealth, I haven't used my wealth as an income source, but at some point soon that could change, because my wealth is now getting towards being sufficient to be used for such purposes.
NB it' makes absolute sense for me to do this... I know my pensions kick in at 60 and then 67, with a certain amount of liquid funds that come available in both instances, by the time I reach 67 my income from both pensions will be pretty decent, so I may as well draw down on some of the wealth as I approach pension age to work less.
But TBH I'm struggling to get myself into the mindset of drawing down on some of that wealth for income purposes.
The closer I get to retirement age the more I want more of a wealth stack.
I think it's good to be realistic leaning towards pessimistic...
For example my current pension age is 67, but I calculate for 68. I think there's a 95% chance that the pension age is going to be pushed back, just a little. It could go back to 69 or even 70 for people in my age category of course, but I think 68 is a reasonable compromise.
Certainly for anyone in their 50s, I wouldn't bank on being able to claim your SP when you're 67, it'll probably later, obviously for anyone below 50 it's anyone's guess how long you'll have to wait - 72, 75 maybe? But there ain't the money for ya, not with the amount of debt the UK has, sorry but that's just obvious!
(Anyways, that's another story!!!)
I'm also thinking more about big ticket items and future capacity to meet them..
- Cars
- House repairs
- Health
- Big ticket one of luxuries such as holidays.
All of that could be pricey...
And you have so much more if you just wait another year or so to draw down...
Wealth targets for 60 = £120K (draw down £10K a year) Alt = £60K draw down £5K a year and do SOME work!!!
If I were to draw down from age 57 = £180K (draw down £20K a year)
56 would be £200K, 58 would be £160K - THAT'S A REMARKABLE DIFFERENCE the younger I get.
Looked at another way, I'd have £20K year more in the bank PERPETUALLY if I could fully retire on my wealth at 56 but chose to delay just one year until 57
Final thoughts...
I guess if work isn't so bad, which it isn't ATM, one just carries on working for a year or so more, even one year can make a massive difference!
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Or, you just get 1 bitcoin, and you will have enough to live on the rest of your life.
There are two modes in retirement.
You have worked all your life for money, and money seems to be falling apart. (inflation, bank failures…) So, your thoughts for the future are worried.
My best advice is bitcoin, silver and cash in hand.
They will rise more than everything else falls.
There is certainly the possibility everyone's gonna be chasing their tails. I've already got my system-fucked scenario crypto now I'm working on my contingency plan in case the system survives another 30 years, it could do, they're clever!
Ultimate-Ultra-Can-Kicking!
Puts football (Soccer) players to shame with their cleverness.
And, you are correct, the system could limp on that long. I never expected QE-infinity
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My heart says what to f.ck to do with that pension after age of 67 :)
Unless there is anything you specially want to do, and if you can do part-time, keep working!
Yes that's true, work can be very worthwhile, I mean what else is there...?
Hehe ... I found it a dilemma to contemplate not working four years ago, although I could have stopped working then, if I'd wished. It made sense to continue while I adjusted to the notion that I didn't actually need to work (in the sense of earn an income) any more. I don't have that problem now!
I'll probably end up going a similar way myself!
I think 100k pension pot gets you around 5k pension a year. Unless I'm missing something, I can't see how that stacks up if I start retirement at say 65. Life will be so miserable in my 80s if i live that long
Ah that would be miserable, that 100K is in addition to my Teachers and State Pension, the later two are sufficient to meet my needs already, not provide a life of luxury, but life wouldn't be too miserable either.
I heard teachers pension are very good, so it's great that you have that safety net, likewise if you have the full state pension. Pensioners are well looked after by our government.
What I really meany was that with a 100k pot and 5k pension a year, I'd only break even if I live for 20 years, that would be 85 if I start to claim my pension at 65. From a financial return pov, that's what doesn't work for me. I could probably get the same if not better return if I invested it carefully myself, and get the flexibility it use the pot when and how I want
Tbh I haven't fully explored the annuity route to see if there's some thing more than my current understanding, but as it currently stands, pension doesn't work for me
I wouldn't Vest into a private personal pension and then buy an annuity, I might put something in a SIPP, then you get back 25% cash free at 57 in my case.