Pitfalls of early retirement

bcklschaps

I am re-opening this older thread.

http://www.boards.ie/vbulletin/showthread.php?p=84923343



I am being made redundant next Feb/Mar I will be 43yro. I have been working for about 22years. I will be getting a reasonable redundancy and I have some savings. In total I will be sitting on about 150k.
I will also be able to cash in my pension from 50yro onwards .. so will be inline for another 15K lump sum or there abouts.

I own my own house (Mortgage is fully paid) and I have about 20 acres of farmland as well.

I make a small income from the farmland about 1k per year

I am considering retiring Full Stop in March.

My reasoning.

1). I'm kinda burnt out from work and need a break from the rat race. I am not sure I am happy to work my whole life anyway and then roll over and die. There has got to be more than this ?

2). This break in my work career is coming at a nice time in my life, I am single, I am old enough to have a few quid saved up, but I'm still young enough to be able to have some 'real' fun.

3). I have old aged parents that need a bit more attention than I have been able to give them over the last few years due to my work commitments. Be nice to spend more time with them.

4). There's a few things I would like to do .. If I had the luxury.

Burn my Alarm clock, and sleep-in every morning till 10 or 11am
Enjoy a relaxed breakfast every day.
Do a bit more travelling (but with an open ended agenda, unconstrained by work holidays)
Learn the guitar
Go out drinking at noon on Monday or stay up all night on Wednesday .. and not have to ever worry about work.

But naturally I have a couple of genuine fears as well....

1). That if I took maybe a year off .. that I would not be able to get back into a decent job again and might even get stuck in long term unemployment.
2). I am not sure how my self esteem would hold up if I was long term unemployed. (Especially knowing that it was due to my own conscious decision)

3). Would I eventually get bored and depressed ? How would I spend my time? I couldn't very well spend my days in the pub or go travelling all the time as I would need to be watching the outgoings as I would be living on the dole and only using my savings for exceptionals. Hanging out in Pubs and travelling the world are both fairly expensive pastimes.

4). Speaking of the Pub, I like a drink, but would I become a complete Alcho seeing as I suddenly have plenty of time for it. Maybe end up spending all my loot and become a penniless bum.


Anybody any thoughts ?

smash

165k is not a lot of money. Especially if it's to last you the guts of say, 50 years...

gandalf

How about looking at doing a course. Something that is not commercial based. When I left school I really wanted to do a University History Degree course but stopped myself because there were no jobs at the end of it. If I was in your position now that's what I would do.

You do need something to ensure you keep mixing with people be it a part time job, doing a course or even setting up your own business.

gaz wac

Sometimes retirement is the worst thing that could happen to a person, they just kinda give up!


My dad wishes he was back in work, misses the people, having the crack and the set routine that goes with it. ( he's 70 though)


Hope it all works out for ya OP ....great chance to get out there and do some traveling while your still young. good luck

Work part time, self employed, make more of the farm free rang eggs?, build a small holiday home for rent to provide some income for you self. Re train for some other career you are only 43.

A mixture of all of the above.

valoren

You mentioned the rat race.

Find out what you are passionate about then figure out a way of getting paid for it.
Essentially get paid for having a hobby.

imitation

Why think retirement, you are in an ideal situation to change career into something interesting and enjoyable. That doesnt mean you cant have a nice career break and travel, but as you say it yourself, you will more than likely get bored after a few years of it. Im a firm believer that people need to feel they are doing something with there life. If you are just hanging about its just a slow descent into boredom and obscelence.

Your situation can change a lot too, you could meet somebody too, After 10 years on the dole no employer will be particularly interested, but you maybe stuck for money. Theres no guarantee the state wont get screwed up too, whos to say they will give out the dole indefinitely, most countrys dont, especially not to people who own their own assets that could be sold to support themselves if they dont want to work (rather than being incapable of working)

chops018

Take a year out and see what the story is and how you feel then.

As other posters have said, you could miss out on work etc. after a while.

But if you decided to just take a year out to go travelling, or decide to do something with the money like start a new business, or invest it, then now you have the free time to do it.

43 is super young and most people would probably be looking at having to work another 20-25 years before even thinking of retiring at that age.

Fair play on getting to the position you're in now though, I doubt it was easy to have most essential things in your life paid off and have a tidy sum at the end of it.

littlevillage

On a wet Wednesday its definitely tempting to feck off and retire

But as you have rightly pointed out ... what happens, when you get bored and depressed and start spending just to pass the time. I think you would need a bigger nest egg (or be prepared to sell some of the property if necessary)

Incidently I know a lad who did something similar .. Not Sure exactly what age he was but somewhere in late 30's, early 40's. He took voluntary redundancy back in the early 00's, got a nice wedge of cash. He took a good long break (6 Months kinda thing), but then found it hard to get a job and after a year or so he was completely locked out of the employment market. He hasn't worked in 10 or 12 years at this stage and he's a bit of a basket case...hangs around the house all day, drink, depression, over weight etc.

He has never actually admitted it to me but I reckon if he had the chance again he would have done things differently. eg. Stayed working or at least not taken Voluntary redundancy until he had something else lined up first.

BBDBB

Take some time off, relax a bit, but keep busy, find something you enjoy doing and see if you can turn it into a small income, you have some resources, but not really enough to be thinking you will never have to work again. Interest rates are pretty poor so your capital is going to ebb away faster than you think. Make some positive decisions rather than listing a few lazy day ambitions.

recylingbin

Be careful not to die, which seems to happen to a lot of retirees.

Mr. CooL ICE

recylingbin wrote: »

Be careful not to die, which seems to happen to a lot of retirees.

mod:

Down with that sort of thing

bcklschaps

bcklschaps wrote: »

.............

I am considering retiring Full Stop in March.

.................
1). That if I took maybe a year off .. that I would not be able to get back into a decent job again and might even get stuck in long term unemployment.
2). I am not sure how my self esteem would hold up if I was long term unemployed. (Especially knowing that it was due to my own conscious decision) .....................
Anybody any thoughts ?

You're thoughts are all over the place imo

If you genuinely wanted to retire full stop you wouldn't be thinking about not being able to et back into into the rat race after 12 months.

You also seem very inclined to think you'll get overly fond of the gargle.

Financially, €1k/year is nothing essentially, you have 7 years to go until pension at 50, €150k won't be long dwindling.

After 6 or 12 months you will be assessed for JSA, you won't be getting that with €100k in the bank.

If I was you I'd get a job of some sort to keep body and mind together, I'm not gone on work myself but it doesn't do you any harm. Especially if its a handy ish job with low responsibility and little pressure and you have money in the bank.

tina1040

You're only 43. You could live another 43 years.
You're not to old to meet a nice woman and have a couple of kids.
IMO it's far too early with very little assets to be retiring and drifting into sleeping, drinking whenever and being generally lazy.

Letree

Go for it. I would do it in your position. You may have to live more frugally but that one of the choices you have to make. And anyway you can always go back to part time work in a number of years if you feel you'd like a bit more money.

Im stuck with 20 year mortgage and working in a job i dislike. To get a full pension i'll still be working till im 67. Its a terribly depressing thought.

BattleCorp

I suspect that if you retire completely, you will run out of money.

bcklschaps

Thanks all for the useful contributions.

I see that I have a couple of options.

1). Go ahead with the plan. Take the loot in March and never look back. It might involve some fairly thrifty living down the line because my nestegg is modest, but I'll never be a fulltime 9-5 work-aday drone again. (a seasonal part time job might be a reasonable compromise to keep the machine greased and my sanity intact)

2). Take the summer off and see how I feel in the Autumn. Perspective is everything.

3). Try to line up another similar job to the one I have now, before I get layed off... 'its easier to get a job when you have already got one etc.' but maybe negotiate a start date later into the summer to allow for a decent holiday of maybe a Month or two.

the evasion_kid

do it,wage slavery is soul destroying..

danganabu

Option 2 for sure seems the most prudent, but it's your life bud so you do whatever to hell you want and fcuk the begrudgers!

How about just getting a nice part-time number behind the bar in your local, kill two birds with the one stone and no real stress.

draiochtanois

This post has been deleted.

littlevillage

I think we would all like to be in a position of not having to get out of bed on these cold December mornings ... but as most all of the other posters have said.

You will eventually run out of money and maybe run out of your mind too... if you completely retire at 43.

Take a step back ...maybe look at some other handier career options. (It sounds like you have worked hard in a tough gig for the last 22 years).

Would love to be in that position myself. Let us know how it pans out in Feb/Mar ?

Bulbous Salutation

Alcoholism.

The J Stands for Jay

Will the farmland be producing your food? That would help stretch the budget a bit. You'll need to invest the money in order to make more of it. You now have the time to learn everything on how to do that. You will also have the time to learn all sorts of skills. Maybe you'll learn a bit of woodwork, and someone see the contraption you built for the craic from some wood and nails and they decide to buy it off you. You could set up a travel blog and start earning a few quid off that. Hell, you could even blog your expected descent into alcoholism.

FalconGirl

Go for it OP. You can well afford to take a year or two out if you feel that way. As another poster said find something you like doing and maybe invest in it and spend the rest of your career there. Find a job you love and you will never work another day in your life.

I know the feeling of burn out. The 9-5 slog etc. There is more to life than that for sure. Feck the societal norms! My old boss in a financial institution went from being a high flying executive to working in a coffee shop. He quit suddenly because of burn out and is as happy as a pig in ****e serving coffees and scones.

ytpe2r5bxkn0c1

I retired in my early 50s. If you are ready to retire you will know and welcome it.

The money you cite is very very small. My lump sum was several 100,000s and ongoing pension is very generous.

You are just too young for retirement. Take the summer off, do a course, or change to a career you would enjoy.

That said, early retirement is brilliant. I have never been bored and have thrived on it.

Avatar MIA

If I was in your position I would consider taking the redundancy and taking a year out.

I could get away with saying something like, 'I left my previous job to set up a business, but unfortunately I missed the corporate life too much and yes, I would like to work with your company.'

However, the expression 'what's seldom is wonderful' comes to mind. Something like sleeping in until 10/11 am is only a novelty because you cannot do it too often. If you go to bed knowing you've no urgent need to get up a large part of the benefit is lost.

I'd also worry I'd miss out on work life. :rolleyes:

One thing - make sure the €150k you're expecting is post tax. (You'll not get all of a large redundancy fully tax free).

sbsquarepants

I'd jump at it. Live a bit before you die. I would if I could.

Your house is paid for. Take a mortgage out of the equation and you'd be surprised how little money you can get by on. 150k plus whatever the state will give you, you'd get by perfectly happily. I would anyway - but maybe you like champagne and caviar more than I do:D

Permabear

This post has been deleted.

FTA69

Don't think I've ever agreed with Permabear on anything but he's spot on above. Work is important for a man, it gives him structure and a sense of accomplishment. Now, I'm very, very lucky to be doing what I do for a living and I know that being stuck in a sh*te job can also be soul destroying. However, I also believe that the one thing that is more soul destroying is lounging about the place doing dick f*ck all and counting your pennies and that's a position you'll be in very soon along the line if you pack in work completely.

You'll be getting a big lump sum soon which is fantastic; you could use it to put down a deposit on your own gaff or pay off some of your mortgage. You could invest it in a night course or even go back to college and get a new degree in something.

By the sounds of it you are p*ssed off with life in general but there are things you can do to reboot yourself. Use your holidays to take an unconventional trip that will see you discover more about yourself, take up a music or language class in the evenings, get into a fitness routine etc etc. Life is what you make of it.

I think you need a career change and to get out of a boring routine, jacking in work and staying in bed all morning isn't going to do anything for your happiness long term.

maudgonner

Definitely sounds to me like you should take your redundancy, have 6 months or a year off and then reassess.

Bear in mind that you won't be able to just stay on the dole for the next 20-30 years. You'll more than likely have to do some courses/internships designed to get you off the dole. (Yes, I'm sure there are ways to get around this, and this being AH, somebody will be along promptly to laugh at me for suggesting this is the case).

Take a break, enjoy your time off, do stuff you've always wanted to do and get your energy and enthusiasm levels recharged, then you might be in a better position to figure out what to do next. Putting a time limit on it (even a rough one) will mean that you won't sit on your arse at home for months on end, you'll spend the time more wisely.

(But do burn the alarm clock, or better still, blow it into smithereens)

etoughguy

You have zero plans on how to make 165k last until say 70 which is about 6k (ball park) a year. I would put alot more thought and planning into this if I were you. Sure take loads of time off but that money will run out long before you do without growing or being added to in some way
Boredom is another thing to contend with so stay busy and good luck!

pickarooney

valoren wrote: »

You mentioned the rat race.

Find out what you are passionate about then figure out a way of getting paid for it.
Essentially get paid for having a hobby.

So we should all become prostitutes?

biko

Buy boat, sail the seas.

WhiteWalls

Sign on the rock and rool (dole) and you will be OK for many years. Do a retirement course, stay relatively busy and have a routine

LeeLooLee

Are you serious? At 43, you want to retire and just laze around? Jaysus, you have opportunities most people could only dream of and all you can think to do is lie in every day and go to the pub? After a few months of travelling/relaxing and recharging your batteries, you have the chance to retrain and work in pretty much anything you want, without worrying about study costs or supporting yourself. Or if you really didn't want to have a conventional job again, you could give loads of time as a volunteer to help others. That would surely be more satisfying and make you happier than sitting in the pub half the week?

Strumms

I would not in your circumstances make a conscious decision that ok.. thats me I'm done and retired at 43. Especially being single and having no kids.. that is going to leave a lot of time in your day to fill. I have taken some time off work recently due to a back injury and I have been crawling the walls with boredom. Like you no wife or kids, I don't live with the girlfriend however I have a lot of interests and hobbies but I was still bored to ****. You also spend money much faster as you are always after an outlet to kill the boredom so go shopping.. eat out.. down the pub a bit more... a weekend away a holiday here and there.

What I would do is make a plan and give yourself a year or 6 months to enjoy yourself... Book a few trips away... Buy yourself that guitar and get a teacher... try and get involved in activities with others such as join a 5-a side football team or something along those lines that you would enjoy so that you have stuff to do that takes up your time and you have things to look forward to during you week. That ramble down to the pub a few times a week can become a little too easy and frequent. By all means take some time but don't enter a mindset that you are done. Not healthy and not all that financially viable even if you have land and a few quid its a long way from 43 to 73.

B.A._Baracus

One of the biggest pitfalls of retirement, doesnt matter if it's early or not, is alcohol.
My Dad is recently retired but over the years leading up to his he would see other guys retire and bump into them later on and so many turned to booze as they didn't really have much to do now. Sounds strange but it's a fact.

Even long periods of being on the social welfare can do the same. When you got no job a tuesday afternoon to get pissed is no different than a saturday night.

vienne86

I think you're a bit early to retire and anyway I don't think you have enough money. Anyway I think you would really need to have some serious plans or some consuming passion which you want to pursue, and I don't see those any sign of those in your description. But it is an opportunity to take a course and change the direction of your work......but there needs to be something you really want to change to IMO.

Good luck anyway.

You don't have remotely enough money to retire at your age. You certainly won't be off on mad holidays on that
Retrain and do something else

Robbo

Just be careful when you're exactly one day away from retirement. That day is the most deadly of them all.

Avatar MIA

bluewolf wrote: »

You don't have remotely enough money to retire at your age. You certainly won't be off on mad holidays on that
Retrain and do something else

What are you, an actuary?!?































Oh, right :pac:

Agricola

A relative of mine who was given two months off her mind numbing factory job due to physical injury was almost climbing the walls with boredom and seriously contemplated going back earlier than agreed because she could not fill her days with anything better than what that god awful job provided. People like that would not want to be retiring early.
Others, myself included would happily spend 40 odd years doing pointless arts courses we always wanted to do but never could cos they were pointless, joining clubs, sport, exercise, travelling..... just living fully without the constant nagging problem of money and how to get more of it. You could be one of those people OP, and so maybe VERY early retirement looks attractive. It does to me too. But the problem both of us have is while you have a lot more money than me, neither of us can quit work at that age because we sadly havent the money to last us to 53, let alone the 80 odd years I hope to be knocking around til.

Conall Cernach

If you intend signing on until your pension kicks in you will get JSB for a couple of years but then your stamps will run out and you will be on JSA which is means tested so if you have money in the bank or property you will get feck all. Also if you think you will some day have to rely on the state pension you will only qualify for that when you're 68 or possibly later if the rules change again. You might not have enough stamps to get the contributory pension so again you might have to be means tested for the non-contributory one.

ScumLord

bcklschaps wrote: »

Thanks all for the useful contributions.

I see that I have a couple of options.

1). Go ahead with the plan. Take the loot in March and never look back. It might involve some fairly thrifty living down the line because my nestegg is modest, but I'll never be a fulltime 9-5 work-aday drone again. (a seasonal part time job might be a reasonable compromise to keep the machine greased and my sanity intact)

2). Take the summer off and see how I feel in the Autumn. Perspective is everything.

3). Try to line up another similar job to the one I have now, before I get layed off... 'its easier to get a job when you have already got one etc.' but maybe negotiate a start date later into the summer to allow for a decent holiday of maybe a Month or two.

I'd take option 2. The money you've saved has given you some options but it's not really going to allow you to live out your life without working.

You could set aside €30,000 and spend a year traveling. I'd look into reeducating yourself after that. You may well find that retirement doesn't suit you. You could end up frittering away your money on things that get presented to you, invest in this or that. It's very easy to spend money. Maybe even easier to spend big amounts because you can make big purchases.

The money does allow you some time to reassess and start a new phase in your life. You're probably only half way through life, do you really want to tie down your future to doing nothing?

Its a sobering thought, but even if you had 1 million rather than 165k, you would still have to really watch what you spend to be able to never work again! at 43 you would probably need in the region of 2 million to be able to never work again and be sure of even a modest lifestyle... a sickening thought really, that it take a lotto win amount! better to use your hard-earned savings to take a break and then re-train for something else.

Spanish Eyes

I think you are a bit young to give up all work related activities altogether. Hope you don't mind me saying that.

I took an early retirement package like the poster Srameen above in mid 50s. I had carefully planned for it, paid down debt, no mortgage, no kids needing my help etc. and so forth.

TBH I was also a bit burned out, but I was so happy to go, the time was absolutely right for me.

For the first year I did absolutely nada. Just travelled and dossed around, it was fantastic.

Then in year two (which is now), I got up off my big fat ass and did voluntary stuff. Hmmm. didn't really suit me.

Now I do guiding in St. Patrick's Cathedral and for DCC in the Summer for the tourists. I love it. The interraction, and I have two other languages (one of which is BAD!).

I structure my life around being a lazy fecker, doing what I enjoy as above and eating and drinking ABROAD. Every two months or so I'm off.

Anyway, it won't work for everyone, but state of mind and ARE YOU REALLY READY are very important.

Take a year off. Doss around, travel, eat, drink, be merry. Do all the things in your own time that you couldn't do when working.

An important thing to remember is that if you retire, all your peers will still generally be working. They may HATE you lol, and you may miss their company too.

I'd say after a year you will know what to do. And at your age you will get another job doing something now that the economy is rising again, not like five years ago.

Do a trial run first. You are quite young.

curiosity

I'm taking it that you're not a parent, and single, OP. Have you worked out what your yearly income/expenses would be? From the figures you mentioned, you couldn't go spend/travel crazy, but you could easily manage to take a year out, travel a bit, mooch...

MadDog76

Single, no job and 150k .......... Vegas!!!!!

JJJJNR

Take a break and try mushroom growing, its a great hobby and you could make a nice profit at local markets/veg shops.

tara83

Plan to take six months doing the things you've wanted like sleeping in, travelling and then assess your next step.

You might want to return to a similar job, take a handy part time role go back to education etc.

Don't panic that a year out of the workforce makes you unemployable. Taking the opportunity to enjoy life after redundancy is common and won't go against you. If anything you'll be able to take greater chances like temp or contract roles which you wouldn't have risked when you were in full time permanent employment

Fleawuss

Don't spend your declining years saying "if only". You have a chance not to fritter a small nest egg away on bullshyte but a chance to take stock of where you are on your road. Take that chance to find something that gives you life not burn out.