Can I retire at 61 with 500k pension?

[haveienoughmoney]

There’s a bit of a back story involving the relocation of the company I work for meaning I’d have to commute for 3 hours a day 3 days a week - they will give an allowance to cover some costs for 2 years, after that you’re on your own. They have declined my request for a WFH contract, even though Occupational Health have recommended it, the team I’m in is all remote anyway so there’s little point in my commuting to sit with people who have nothing to do with my role.

So - do I suck it up for 2 years and then retire at 63 or do I go now? My pension pot (DC) is just under 500k which sounds like an awful lot of money, but it could have to last until I’m 90+!

My intention in retirement is to sell my house for about 370k - no mortgage - and move closer to my sons in North Yorkshire where I’d be looking to buy for about 300k. This would enable me to upsize! - I have a tiny but very pretty cottage in Hampshire, I’d be looking to buy a 3 bed town house up North.

I’d value some opinions as once I’ve made the decision there’s no turning back. For what it’s worth I don’t particularly enjoy the job now that we have new owners, both my sons are keen for me to move nearer to them. I really like the area where I’d be looking to buy so if my boys moved away (I don’t think they will, but who knows)? - I think I’d be happy there.

I’m not a big spender and am happy with a reasonably simple life, I need to maintain a decent 2nd hand car, I’d like a few European trips and some meals out.

All thoughts welcome and thank you!

Speak to a qualified ifa ... but yes I think it's fine but then seek part time work to try and cover as much day to day expenses so you minimise your draw down before state retirement age.

@hopingbutlosing

Still worth future proofing. We are younger still but made sure our new house was stair lift compatible, doors wide enough for a wheelchair and the en suite is wheelchair accessible door wise, though current shower isn't we could change it if necessary. I hate moving so I wanted to think it through! We are on 3 floors but the top floor is just guest rooms so barely used

I’d go north like a shot in your position!

I’d then work part time.

I would do a budget of what your expenses will be in retirement, both now when you are younger and fitter, and later when you may be more restricted. Make sure you include everything - MSE website has a budget planner which may list things you haven't thought of.
I would definitely see a financial adviser - £500k now is worth a lot but with inflation averaging maybe 2.5% and may be increasing, it could be worth less in real terms. You'd need it well enough invested or in an annuity or similar to protect against that.

I'd take the redundancy package and look for a totally unrelated casual part time job in your new location for the social side, as your funds won't extend to spending extensive time traveling or taking up an expensive hobby.

People who retire early completely seem to become old for their age faster, especially if they just "potter" and rely on their adult children for social contact. An "elderly" lifestyle develops far too early, as their world shrinks and they become emotionally less independent. Moving away from your base to a place you only know your sons and their girlfriends will accelerate that even further, and though your sons want you near they're used to you being independent - they may well resent you if you start depending on them unnecessarily early, to be blunt.

Even if you get a job in a seaside café or a shop aligned with your interests, it'll keep getting you out of the house and widen your world, as well as being useful extra funds.

Long commute versus a new start in Yorkshire

I know what I would choose

Make the move to Yorkshire

I'm 61, DH older.

Future proofing our home is about having loos upstairs and down and making provision for a personal lift, much nicer than a stair lift. At less that £20k it's a bargain compared to moving home.

Sounds great! I would make sure you allow for maintenance of your house because bigger houses are more expensive to run and would be awful if the get in despaired for lack of funds.

@FinallyHere

I'm 61, DH older.

Future proofing our home is about having loos upstairs and down and making provision for a personal lift, much nicer than a stair lift. At less that £20k it's a bargain compared to moving home.

We bought our current house with an eye on the fact that we may not move again. It's a house rather than a bungalow, but has a full bathroom downstairs already, and has room for a stairlift / lift if we need one. I think it's sensible to think about these things if you are not planning to move again.

I've been discussing retirement with my friends recently.
Several cannot afford to retire & will probably work until state retirement age

Therefore, if you can afford to retire, why wouldn't you ?

I’m the same age and making same considerations, I also read the pensions forum on MSE.

I will drawdown rather than buy an annuity and the forum experts recommend leaving your 25% tax free invested if you don’t need it; the consolidation effect of interest is greater than e.g. putting it into an ISA. Your drawdown amounts would then be 25% tax free when you take them with a greater balance remaining invested.
You are old enough to have a pension with benefits no longer sold - one of mine has a GAR, (guaranteed annual rate) of 3% so it has to increase by that much each year despite the stock market stagnation. If you have this it’s worth leaving for as long as possible. Another has a final bonus on exit. There are other benefits too which is why IFA would be useful.
Your anticipated equity from the house sale + redundancy = 3 years net salary so you could keep the same standard of living, not work at all and defer taking your pension for at least 3 years. On that basis, I’d jump.

That seems like a very healthy pension pot OP but obviously depends on the annuity you can buy so its best to get independent advice.

Don't forget the state pension when you're 65/67

I don’t know the answer to the question you’ve asked but I would put in a formal flexible working request and challenge any attempt they make to refuse you a wfh contract. Then I’d make the retirement move you are contemplating and wfh from the new home for a few more years.

I would get a part Job. Dont just give up work completely. £20k a year less tax isnt that much if you want to run a decent car, have holidays abroad, and so on. and not have to count every penny carefully.

If you can afford to retire, why wouldn't you ?

Depends on your job, how much you enjoy it and what needs it fulfils.

I've started looking for interesting things to do when I do retire. Lots of possibilities but I have yet to find one which is free of people hugging responsibility to themselves and not wanting to share, in a way I have never experienced at work.

My 61 year old mil had a spontaneous heart attack recently. Retire and move. Spend spend spend. The age of 68 you get state as well. You may end using all your money paying for nursing care etc at some point. If you don't have it they can't take it.

One very knowledgeable man on MSE has calculated drawdown can be at 6% for most people. A simple calculation shows this empties the pot in 16 years 8 months but with continued investment of the balance should be in excess of 20 years.
With your pot this would be £30k / yr and in 5 years time there’s an additional £9.6k state pension. Far better to spend more enjoying life early on because at 75 yrs+ cost of travel insurance rockets.
When your private pot is empty at some point in your 80’s you will still have state pension and capital in property should you want to downsize to a smaller retirement flat.

Also, from observing family/friends, a lot (not all!) start to go downhill health wise in their 70s, so enjoy your money, travel, eat out, spend!

Loads of good advice here, thank you!

If the new company were to grant me a WFH contract and I went into the office when necessary (monthly team meetings, etc) I’d happily stay put and work for a few more years, maybe making the move at 63/64. But they won’t budge and the more I think about it I realise I’m not prepared to make the pointless commute - I think because it’s ‘only’ 3 days a week I considered giving it a go, had it been 5 days a week in the office I would have requested redundancy immediately.

Someone said I don’t want to risk being an early liability to my boys and their partners - this is something that’s been on my mind but I truly have no intention of imposing upon them. Read too many DIL threads on here and don’t want to recognise myself in a future one! I would hope to find a part time job, join the gym and spend time exploring the new area but still be on hand for dog sitting and helping out with potential childcare.

I’m not ready for the stairlift yet! - but take the point about future proofing the house.

I have seen a financial advisor (much of my pension wealth came from a pension share in my divorce settlement) and his opinion is that I have a very healthy pot which should last a long time. I sometimes forget about the state pension, but that’s another 9k a year in a few years time, I realise I’m luckier than many.

My Dad died 30 years ago 3 months after retiring and never got to enjoy retirement. He was, to all intents and purpose, fit and well - I would hate the same thing to happen to me (although the boys would inherit well)!

Decision made, I think. Redundancy payment, take some time to relax at home and then spend a week up north visiting estate agents. There is no great hurry to move, I want the ‘right’ house in the ‘right’ area.

Thanks again for all your thoughts.

How exciting! Good luck with it all then 😀

Btw… the needless lack of flexibility from the new owners who make me think wary of:

• them being ageist and actively hoping you’ll go (based on age, not you personally!) which doesn’t bode well for staying
• the culture of the company will change in a way you don’t want

For the sake of 2 years with £15K redundancy on the table, I’d take that over being miserable for 6 months then quitting without the redundancy.

I know those two things aren’t a given - just, they’d be in my mind.

I wouldn't think twice about it especially as you don't enjoy your job. Totally agree with talking to an IFA and knowing your options.

Where in North Yorkshire are you walking to the theatre for £300k? Scarborough? If so be very wary -very socially deprived

Cocomarine - the new owners are very proud of their equality, diversity and inclusion policy. I said to HR making middle aged women commute up to 3 hours a day did not reflect upon them well (I’m not the only person affected by this, several colleagues are thinking about leaving too). They said at takeover they didn’t want to lose anybody as they valued the workforce - well, they’re going about it in the wrong way!

* suggest you look for a bungalow all on one level, exterior door wheel-chair accessible. Space for a walk-in accessible shower with a seat, usable by a personal assistant helping you to shower. A manageable garden with sitting out space, where you can potter, keep a pet and dry laundry or park a car.

This is so depressing. OP is 61, not 91!