To give up working at 52?

[caniquitwork]

I am a teacher, but I've had enough.
I have a small teacher's pension- small because only paid in 15 years and even then mostly only part time. Have some other private pensions which will eventually pay out about £1000 a month, but not till I'm 60. Would not touch teacher's pension until then either.
So here's the aibu part - I have a house I own outright so no mortgage, but to live on until 60 I have about £250000 I inherited. Would obviously invest but don't think interest would be enough to live on, so would also just withdraw from the pot iyswim.
Would that work? Would it be selfish- should I keep this money safe for my children?
No dh in the picture. Keep
going round in circles. Wouldn't mind working in another job to supplement but worried if I could even find anything.

Yes. Just thinking a £250 000 house here lets for £1400

why do you say don't put your money in to BTL? thanks

You're not financially insecure OP, but you would be making yourself so if I chose to retire at 52 with no good reason to do so other than you're fed up of working! You have a house with no mortgage - great - but you'll always need somewhere to live, so unless you downsize and release some of that equity it's tied up in bricks and mortar and will be for the foreseeable. And while your mortgage is paid off, you need to maintain that house (or another house) for the rest of your life and houses need constant maintenance. You will need to redecorate, have a new kitchen or bathroom periodically, replace furniture, soft furnishings and appliances, deal with loose tiles and leaks, have trees and bushes trimmed, etc. And as you age, you'll have to get people in to do more jobs for you - maybe a gardener, a cleaner, a handyman - so you need a bit of a cushion for those extra expenses.

In order to enjoy a moderately comfortable retirement, according to Standard Life (www.standardlife.co.uk/articles/article-page/how-much-do-i-need-to-retire), you need to be drawing a pension of £31,300 per year as a single person. Your £250,000, if spent over 8 years, will bring you £31,250 per year, so for the first 8 years of your retirement you'd be able to afford that comfortable lifestyle, but that only takes you up to age 60. What will happen after that? Your figures aren't clear, but you need to do some number crunching to see what your various pensions would bring in per year. I'm guessing that they won't be close to that £31,300 figure and with the CoL having gone up so much recently what happens if it goes up further? You've got a lot of years ahead of you in which to worry about that, if you stop work now.

Not aimed at you OP, just a general comment but if having paid off your mortgage, having £250k in the bank and a decent pension lined up isn't enough to give up a job you hate and enjoy your remaining healthy life years then what exactly is the fucking point of it all. Are we just supposed to work ourselves in to the ground forever, accumulating more and more wealth for some undefined future benefit. You could literally be dead tomorrow. I wouldn't work a single day longer in a job that sucked the life out of me if I didn't have to.

Well, you are financially secure, you are just not in a position to retire at 52. Which would be a very privileged position to be in and very few people can afford that. You just need to keep working.

You could literally be dead tomorrow

Well yes, that's possible - but it's extremely unlikely. The OP's life expectancy is probably the same as mine (I'm a similar age) and mine is 87. That is a hell of a lot of years to need to fund.

The OP's £250k nest egg, if invested wisely, could provide her with a nice, regular income on top of her pensions once she reaches retirement age. I'm fairly sure an IFA would recommend she does that. But no one with an ounce of good sense would recommend that a single, able-bodied adult with a professional career quit work at 52 with the amount that the OP has saved currently.

@KittensSchmittens but 52 is very young to stop working, I think the answers would be different if she was 62. If she stops working now the OP would be throwing away 14 more years building up her occupational pension as well as burning through £250k lump sum she has from an inheritance.

Ther eis also the risk of she gets to 62 after 10 years of not working and realises her pensions are not what enough, she may well be unemployable.

To give some context @caniquitwork to the figures.

We've chosen to take an annual pension of a reasonable sum, when the time comes, giving a guaranteed annual income, rather than cash in a final salary pension and live off capital & the interest.

Our brilliant IFA said that a pension pot (over £1M) wasn't enough to fund potentially 30 more years of life. This was retiring at 65.

He also advised keeping £200K of savings aside for possible nursing home fees, rather than relying on a 'bottom of the pile version' from the council.

Get yourself an IFA preferably through recommendation.

My younger brother died last year aged 57. He never got to enjoy his pension and I know quite a few people who haven't lived to see retirement. I'm 60 this year and I wish I could afford to retire and help look after my gc. I have enough credits for a full pension at 67 if I get there.

@cheezncrackers the standard life link is not working for me but 31k equates to 2600 a month, which is more than I currently take home after tax!

I read an aviva blog that stated 1700 a month was a target for a comfortable retirement. No idea who to believe.

I'm sorry to hear about your DB @Manthide, but the point is that you often don't know if you're going to be one of the unlucky ones in advance. And while there is always a chance that you won't make old age, there is a greater chance that you will. It's important to plan carefully for your retirement and not make sudden changes to your plans without ensuring that you'll have enough. If the OP does her due diligence, speaks to an IFA and goes through all the numbers I'm sure she will make a plan that is sensible.

I've known a few retired teachers who do exam invigilation to earn extra money. It's seasonal of course but incredibly easy money, though boring.

Absolutely no reason to feel that way.

The best thing to do is get yourself armed with some facts. Double check your teachers pension is correct- also make sure that the annual amount is not based on you continuing to work until you are 60.
Check what jobs are available in your area, see if you can find out any info about invigilating or marking.

Try living off a reduced amount of salary and see how it feels - plug the rest into your pension or savings.

It might be once you have done the calculations you decide that you could stay on for say 2-3 more years. That way you would still get to retire early, but you would build more pension and savings. It may not be so bad if you can see an end point in the near future.

It would take most of her capital. Houses are an illiquid investment meaning that if you need the money quickly then you can't get it. It's also a one-way bet on the housing market that could turn at any time. The home still requires maintenance and extras funds spent on it to maintain it. Lastly, you have to deal with people and people can be fickle.

No, you shouldn’t limit your life plans in order to keep that money for your children. Use it for what you want to do, and if you want to give up work, do so.

Have 6 months or a year off, relaxing. It might be there is a job you’d always fancied but didn’t pay enough, so you didn’t do it. Say you’ve always wanted to be a florist - do it part time.

Your "brilliant" IFA needs some serious education!

@marshmallowmix With changes in legislation it’s a lot harder to remove a tenant. You have to let them have pets now due to a change in legislation. Plus housing now needs to be raised to a very high standard with houses having specific insulation etc. Obviously I’m against slum landlords but it’s all changing and costing landlords more. It’s why many small landlords are selling or changing to air BnB. Peoples hatred of landlords means that huge corporations are buying swathes of houses, the rental market is only going to get worse.

If you suddenly need money it’s tied up in a house and that house may take months to sell. So then you need to give notice and then even an ok house sale without too many pitfalls can take six months to sell so it may sit empty. Also an actual house to buy, prices are insane now. A 2 bed terrace was 80k to 100k where I lived 20 years ago when I contemplated becoming a landlord, they are now 200k. Then all you need is a tenant that wrecks the house and causes thousands of pounds of damage. You get bad landlords but you also get bad tenants.

If people are small landlords in addition to having other investments that’s very different.

I would check the job situation first.

People seem to think it's easy to waltz into low paid part time jobs, not realising that a) there aren't a lot of them about and b) the good ones will be snapped up quickly.

OP does have more options because of her current role, but it's good to be realistic about what roles actually exist.

That is my worry @rookiemere

I think I'd rather listen to them than some unknown poster.

What exactly are you finding fault with? Do tell. I find your comments rather ridiculous.

I'm not giving precise details of my money- just the bare bones. And you have no idea of the context or circumstances.

The figures I quoted are actually fairly standard for living off cashing in a pension.

We've been with him for years and he's excellent. I can't share his details as he's fully booked now 😁

I had to remove the ")"

https://www.standardlife.co.uk/articles/article-page/how-much-do-i-need-to-retire

I early retired on a pension fund of £500K (half your IFA's advice). I've lived quite happily with holidays and cars, etc for the last 10 years and only drawn down a fraction of the portfolio left after purchasing a pension. My Excel plans show me well ahead of target for the next 20 years.

So, yes, your IFA stating that you have to have £1M is just cuckoo.

The £1M pot being insufficient is probably based on it producing an income far higher than the OP is used to as a teacher. Therefore totally irrelevant.

You're incredibly rude to be honest.

It' s possible to have another opinion without being unpleasant.

The figures you quote don't work for us- we're not stupid. And it's high risk.

You do you, as they say.

Agree. See a financial advisor, make a plan, and go for it. Shrouds don’t have pockets.