Pleasantly surprised how cheap retirement is..

[Reproician]

Two years ago I was earning £70k and living very nicely on it.

Then stuff happened and I decided to take very early retirement. I have good pensions to come in 5 years' time, but meantime have some casual work which earns £4k pa and investment income of about £12k. I planned to live off savings to fill the gap and budgeted up to £20k pa.

Now, I realise I am very fortunate and I am definitely not claiming poverty. I realise being well set up and then moving to a lower income is entirely different to a lifetime lived on a low income. My mortgage is paid off etc, but I am finding I only need to draw on the saving for one off big purchases. I've drawn £6k altogether in 2 years.

I'm still living a good life. I still spend without thinking to hard on the things I want, I still have a busy social life, I still travel multiple times a year.

Being able to be fully flexible means everything is cheaper. I can at the time of the week/month/year when flights are cheapest etc. And the money I must have been spending on clothes, food, travel for work etc. PlusbI think when you're working hard there's a tendency to spend on "treats" that you don't feel the need for when lofe is.lore relaxed.

Just me and an adult son at home. He pays some keep, but I don't make any profit out of him.

Very well done for giving up smoking. Nearly £20 per pack is it, if bought legally?

What do you mean "reverse"? Stop?

I feel a little like this already, and I'm only 48 but I paid my mortgage off five years ago. Our household income pre-tax is around £40k, but the mortgage was the biggest killer. Our income is more than enough to live on, and I save several hundred a month. The only thing that could get better is once the kids finish school that we could holiday off-peak.

Yes, reverse the legislation that allowed right to buy which would stop it? Same question, why didn't any political party in subsequent governments, especially Labour do this? Why not now...they have a large majority so would get it through.

Sounds like it. Can you retire from God?

Move to Scotland. The SNP stopped it in 2016. I agree with you.

Can I ask, did you remain single and have no kids with a view to having a comfortable, early retirement (although I'm not sure how being single might negatively affect that)? Also that's quite something to calculate from a young age. Just curious though.

I feel like the reason we feel well off is that we live in a cheap area. Even in the 80s when we bought our house it was much cheaper than London prices. Hence we were mortgage free while DC were still at school.

Had a discussion with DS1 last night. My DC are both in good public sector jobs and bought houses in their mid 20s. DS(30) knows that public sector pay in London is higher but he hasn't a clue how much higher the col is in London. He would be nowhere near able to buy a three bedroom house with nice garden at 25, on his own salary, in London. The knock on effect is lifelong, he has built up quite a pension / savings pot because of his low mortgage.

The only gain in owning London price property is when you downsize, move away or die. If you don't have to live there your money would go a lot further.

I read so many posts on here from people saying they must have x amount to retire. If you love your job and are in a good working environment then you have the option of building up a massive pot if that's your priority. However, in reality, many are mentally or physically burnt out, or just had enough of working 40+ years and want to enjoy their hobbies, family or being at home more. In fairness, OP acknowleged not everyone has had the earning power they have, but our income has been about 60% of theirs and we were still able to take early retirement.

If DH hadn't retired, he'd probably have been signed off long term sick (asking others to pay for that in terms of benefits). Many of his colleagues have gone off with depression/mental health issues, while he carryied on working being tearful at times and he just couldn't do it any longer. I eventually left as I couldn't take it any more being pressurized to do things that I just couldn't do in the time and being expected to explain myself every single day (turns out the manager has to do my job sometimes now and realises, he takes even longer than me!). What's awful though is people who feel like this, and they really can't retire due to earning capacity near minimum wage.

Completely agree. Blair could have stopped it. The current government could stop it and while it's too late to undo the damage caused to social housing I cannot see any justification in keeping the rtb.

It’s exactly what has happened to many people over the last few years.

I agree. Don't underestimate the cost of working. Commuting is a waste of time and money. It clogs the the streets and roads (more pollution) and took 3 hours out of my working day - one of the better arguments for working from home. I have one pair of tights languishing in my drawer. Don't think I'll ever wear them. I may apply the odd bit of make up once a month, but because I'm retired I'm in a swimming pool a lot and make-up is a right faff there.

Not the UK tax payer.

I am one of those dastardly immigrants who made UK my home as adult, pay >40% income in taxes, barely use the NHS because I can't get an appointment in a timely fashion, and saved the tax payers 1000s by sending my kid to a private school.

In the past 20 years, I've seen older generations put my kid's generation's future in jeopardy, via Brexit (after they enjoyed the benefits of EU for decades), and via endless wealth transfer in various forms.

Take simple living costs where I live. Ask anybody in my kid's circle and they will tell you horror stories about rental costs and ridiculously priced houses. Why does this happen? My local pensioners association loves to stop any new construction because - and I kid you not this was one of their objections - they could "see the flat from High St and therefore it was detrimental". My local Tory council loves to play along with these NIMBYs. Deliberately strangling supply has had a very nice positive impact of the house and rental returns of the local pensioners.

The past 15 years have seen an increasing wealth transfer from the young to the old in this and other forms. There was case to boost pension benefit (and it's a benefit like other forms of benefits) back on 2010 but the time for triple lock is over. Heck, parties can't even summon up the courage do a means tested removal of winter fuel benefit.

Sorry if I sound bitter but that's the reality. And now we have Burnham talk about even more taxes to pay for "free" social care, and my rage boils over.

Well if MNetters are as rich as people keep saying on here, they'll ditch the NHS and just go private, which is what is happening already. We like to think there's still an NHS, but haven't we just become a whole new country in terms of national healthcare?

The mortgage?

I had a look at the spreadsheets from the retirement living standards page (https://www.retirementlivingstandards.org.uk/details) link to excel downloads is at the bottom of the page.

It is very detailed but very much shows how variable both fixed and discretionary costs are. For example, under 'household goods' it has an exhaustive list of everything from carpets to lightbulbs, with an estimate of how long each lasts and therefore how much it should cost 'per week'. But probably everyone entering a planned retirement would not be expecting to replace many items ever again.
On the other hand, the council tax is for a band C property in Sheffield (just over £2k per year) which is going to vary quite widely I would have thought.

There are a few things I think it overestimates (I don't need £1500 on clothes per year, or a £10 bottle of wine a week, nor £160 per year on perfume) but they aren't wildly out of line with what you might expect for a 'comfortable' spend to be.

It seems to be for a healthy couple in their 60s - 70s I would guess. It only allows 2 days per year for a cleaner and 2 days per year for a gardener.

One of the things I am most nervous of is a significant policy change that makes a major dint in my finances. Obviously there could be a positive change (eg on costs for care) but there could easily be any one of the following which could make a significant difference in any retirement planning

NI on pensions
Council tax changes based on people per property to encourage people to downsize
Removal of free London travel for all London pensioners
Capping of amounts in ISAs
Removal of tax free cash amount in pensions.

Etc etc.

It is for some people. Some people are bitter for their own understandable / personal reasons.

I took my micro small pension of £650 pm at 55 and I'm still working 3 days pw. With my earnings and pension it brings the total to around £1800 which feels very managable with no mortgage. My husband is similar but has more pension and earnings than me. We split everything and both manage just fine. I figure that the state pension will eventually neatly replace my earnings so provided I keep working I should stay the same.

I've just been thinking about this again over the weekend following an email to say my gas/electricity is going up again and I am really wondering how you manage on less than £2k a month.

My council tax is about £300 a month on its own (actually we pay over 10 months so slightly less)
Gas/elec/water £200

And that's just two bills but it's £5.5Kish out of the £19K before you have done anything else.

You make some very good points especially about the winter fuel payment (why on earth was removing/reducing that even controversial) and, of course, the elderly (in general) voting for Brexit (not my elderly mother!) to piss off the youngsters.

Ah I think you've made the same point as I have! My fixed costs are £550 just for council tax and gas/electricity and by the time you've added water, car insurance/tax x 2 (we might not need two cars in retirement but currently share 2 cars between 3 adults), home insurance and broadband/mobiles you've spent a lot before you've even got to food/household items/window cleaner or whatever.

Removing winter fuel allowance was controversial because 1 in 6 pensioners live in poverty. No-one was suggesting that it should stay for everyone but taking money from some of the poorest people in the land - especially at a time in life when they may also be sick - doesnt go down well with anyone who cares about poor people.

I really think monthly household costs are vastly different compared to where you live.

But they weren't removing it from the ones who live in poverty (and actually don't because they have the safety net of pension credit).

What was personal about that though?