How much pension did you retire with, if you retired early?

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I need to get some pensions advice. Trying to decide if I can afford to retire at 56. I will have a £350k pension pot, plus defined benefits of £5k a year which will pay out when I'm 60. Could top up with a part time job until 60. Annuity rates look fairly good right now.

So, if you retired before 60, how much did you have?

Looking at the information you have given I would say not yet.

Annuities are usually not a great choice for income, but a very safe bet.

it all depends on how much money you need to live on as everyone has a different number depending on lifestyle. Factors such as renting or bought, full state pension and partners income are very important.

Try looking up Meaningful Money on YouTube or James Shack to give yourself the basics.

Be wary as advisors want you to have millions even if you have no chance of spending it.

Much more information needed for anyone to have any kind of valid opinion – and unless people on here are qualified pensions and retirement specialists, then an opinion is all it is. You really need some proper advice. No one can say if that is enough money without knowing if, e.g you have a partner, still have dependents, a mortgage, cost of living in your area, what your interests and activities are, do you plan to travel in retirement???

My DB pension is £15k a year with a lump sum of over £70k. I retired at 59 but still work P/T and will do so until I receive my state pension. Then, my annual income will be around £28k for life. DH works PT now, earns around £15k.
I paid off my mortgage, and moved into a smaller property that we renovated so hopefully won’t need anything major spending on it in my lifetime. We live very comfortably.

Everyone’s situation is different as we all have very different outgoings.

You need to start by listing absolutely all of your outgoings so you know what income you need each month.

A £350k pension pot will provide circa £14k per year. Add onto that your DB pension of £5k that gives you £19k per year.

If you aren’t mortgage free that probably isn’t enough before your SP kicks in.

Recently we had a major health scare as a family. We are both in our mid fifties. We realised you can't plan anything! Nor should you ever worry about money. Take the money use it to live! You might be dead tomorrow! Always recommend critical illness though as that has been a god send x

Annuities are amazing at the moment - I was just looking at this yesterday

Work out how much you need and work backwards. Are you 56 now? If not beware that they are potentially moving the age you can take your private pension from 55 to 57 (I get caught by this by a number of weeks fgs!). Some pensions have a protected age so you can still drawdown at 55.

I also think life is too short - if you can do it why not and as you say, top up with a part time job if you need to. But work backwards - you will have an idea of how much your bills are etc. I would suggest starting there

I'll be 56 later this year. Mortgage will be paid off. No dependents. DH will have around £24k pension when he retires in a couple of years.

When I was looking to convert my defined benefit to a pension pot (decided against it in the end) one of the advantages was that I could do draw down rather than an annuity and front load my spending. So in your case draw out more between 56 and 60, then when your 5k kicks in draw out less and when your old age pension kicks in at 67 draw out less again.

The fact you have no mortgage is good, our direct debits are less than 550 a month so our pensions of 21k and 6k a year allow us to live comfortably. We do have savings for bigger purchases

Should also mention, £500k house which we plan to downsize at some point. Around £80k in savings (that's just mine, DH has a bit less).

What are your monthly outgoings?

Are the 80k savings in an ISA?

With your 360k you could take 90k tax free and depending on your outgoings, that could last you all the years till you turn 60 I would assume?

At that point, dh would have his 24k, you would have your 5k a year so 29k a year which is more than most would have in their retirement before you're even taking the rest of your pension

(Sorry 350k not 360k so you could take 87.5k tax free now)

Also try guide.co.uk

You put your numbers in and it helps with what you might need

Thankyou

I haven't retired but probably have a similar amount to you, but very slightly younger. I want to build up a bigger cushion, not so much for the annual income but more for infrequent large costs and to afford help when I can't do things myself. I also want to be sure that I can survive on my income alone as husband is older, not in great health, and his pension will die with him.

My other concern is a change in state pension to make it worth a lot less or further deferrals of the age at which you can get it, beyond the increases up to 68 which are expected. My state pension would kick in when I am a few months past 67 at the moment assuming that change came in. It would be good to have some certainty on this, rather than retire early but then find that there is an unbridgeable gap later and need to go back to work.

Sorry it autocorrected its guiide.co.uk (with 2 i in the middle!)

Let’s be honest - you need to talk to a financial consultant to get reliable advice.

I have friends who did this, they went early, the issue they have is their friendship circle all still work, and due to that have much higher incomes, so can continue to do all the things we used to, nights out, meals, gigs, long weekends away and they can’t.

In addition their worlds have shrunk so much, they now hang out with other pensioners. Like proper elderly people, during the week, as everyone else is working. Watching bargain hunt, going to the shops, etc are interesting things for them. When we say let’s all go for a long weekend, and start looking they are like oh we could get a week away for that price. But they don’t want a week away, when they do come they whinge about price. And we try to cut our cloth to meet their needs but we can’t just all stop because they are on a pension.

if I’m completely honest it has put me right off early retirement.

Nobody can tell you what would be enough because it depends what sort of lifestyle you want to be able to maintain 🤷‍♀️.

Do you know how much pension you would get annually with £350k? Not a lot I imagine.

£3.5k net per month for two of us.

We had a pensions talk from our head of pensions last week (huge global company). His recommendation was a minimum of 5 x your salary and ideally 10 x your salary in your pot to have a 'comfortable' retirement

The PLSA latest figures show that a couple in retirement need

• Minimum Retirement Living Standard £22,400
• Moderate Retirement Living Standard £43,100
• Comfortable Retirement Living Standards £59,000

Most people also spend more in the first ten years of retirement (particularly on house improvements and travel) than in the next ten years, so you need to consider this too.

I retired early and I love it. We have no mortgage and have travelled quite a lot (able to take advantage of cheap out of season deals) not just in this country but also abroad. I feel much healthier and stress free. We also have a lot of friends who either work part-time or who also don’t work. However, my ex-boss found it quite difficult for the first six months, loss of status, few hobbies and adjusting to being with his partner everyday (despite having a very good pension). So along with financial planning, I do think you need to consider the lifestyle, emotional and social aspects of retirement.

I've been quoted a £17k annuity plus tax free lump sum. Topped up with a part time job til 60 when the £5k defined benefits pension kicks in, I feel like that's doable. DH still working and on £70k+

I'm retiring at 56 in August.

No mortgage or other debts.

DB Teachers pension of £18k.£45k lump sum, which I shall invest.

£5k a year from rental. I've also got £10k in a SIPP that I'm adding to every month.

I've been living off what will be my pension for 10 months now so I know that it's doable.

I'm getting a part time job too which will boost my pension and give me some structure to my week.

No way I can work another year in education. Breast cancer in 2021 has totally changed my perspective.

Another vote for using this tool, you can model different scenarios and is really easy to use.
It is free to use and can be so helpful to understand what your pots can give you.
First step as others have said is to understand your current outgoings, if any will change with change in work eg season ticket and work back from there

With your annuity and your H on 70K then surely you know you have enough to live on?