Early Retirement at 57

Quitelife

Whats peoples view on retiring in mid 50s , thinking of doing so in 2 years time ( 55 now ) when i clear my mortgage , would have a DC pot of 600K at that stage , take 150 tax free and draw 24K a year for circa 20 years with state pension kicking in at 66 stated work at 17 but find work very stressful in recent years and find it hard get up to face into it every day, wife earns circa 30K and is happy working away for another 8 years, kids done for.

rob316

https://www.boards.ie/discussion/2058345724/early-retirement-at-57

Its my plan too (but far away yet), go for it, the figures sound good.

Alonzo Mosley

Go for it , sounds as if you're ready to go !

Jim_Hodge

If you can afford it at all just go for it. I did it at 54 and have never looked back. There's a whole new life/world out there beyond work. Mortgage cleared, kids raised and a guaranteed income? Why not?

Generally if you think it feels right then you should do it.

homerun123

Might be worth a chat with a certified financial planner. Check that they're properly qualified here:

https://www.fpsb.ie/

GNWoodd

https://www.boards.ie/discussion/2058345724/early-retirement-at-57

How are you able to access the pension at 57 ? My pension provider is insisting on I waiting until I am 60

ctomas

great stuff, sounds like a nice plan, albeit a bit tight as you go on with inflation etc. From a first look you might want a small supplementary income assuming you’ll be in good health past your mid 70s. If your wife has a similar retirement pot built up by the time she finishes up that would be a help for sure.

Best of luck with it!

bilbot79

How is your health and how long do you expect to live?

E.g. I'm 45 with a Vo2 max of 67. This is the single biggest predictor of longevity so I need to think about keeping myself till mid 90s if I maintain my healthy habits.

I feel like I need 2m and can't retire before 60

cute geoge

https://www.boards.ie/discussion/2058345724/early-retirement-at-57

You could always supliment your pension with some part time work

Madeoface

https://www.boards.ie/discussion/2058345724/early-retirement-at-57

Go for it. If my daughter didn't have to go to a private school I'd be out the door at 57. Similar type of income but smaller lump sum.... probably have to slog on to 59/60.

Should have had my kids younger.. Finding the grind harder in my 50's for sure.

anewme

Go for it! I’m similar age and looking to get out at 60 but I’ll only have a 400k pot and some cash myself.

I’d be happy to give up the stress and work in a garden centre or something, finances permitting.

Stress is the silent killer remember.

elperello

https://www.boards.ie/discussion/2058345724/early-retirement-at-57

Financially you seem well set up.

Contentment is another issue.

Not saying you need to be one of those busy- busy retirees, you may be happy alone on the side of a mountain.

gipi

Slightly different pension-wise as I was public service, but I retired at 58 (having worked since I was 16) and was delighted to get out by then - I'd had enough.

naughtysmurf

doesn’t sound like a great idea to me, even if you got the 24k annuity, that may be a little optimistic, that’s not a lot of money, your wife isn’t earning a huge amount either assuming you still want to light & heat your home, fix / replace things when they break, take a holiday, have your bins emptied etc etc have you totted up all your non kid related monthly outgoings & what you’ll be left with?

You’ll be dipping into your 150k, doubt if you’ll have much if any left by the time your 66 which is still young, unless your idea of retirement is standing & staring out the window,

Quit the stress filled job for a less stressful full or part time one I’d suggest

Glenomra

Retire from your present position but take an alternative paying role, part time if necessary, or imo you will regret retiring very soon. An opinion based on what I have seen around me among a very large family and community. I could detail numerous instances of early retirees experiencing tedium, then poor health, depression and limited finance. Started their retirement actively, walking, cycling, gardening travelling, socialising etcc etc but very quickly inactivity and inertia crept, indeed sprinted, in. Then television,especially sport, youtube videos, but also in one instance Judge Judy dominated their daily lives. One guard retired at 52 a young active healthy man. By 62 he was 'useless '. Only a personal observation. Others probably have very different opinions and experiences.

Jim_Hodge

https://www.boards.ie/discussion/comment/121995686#Comment_121995686

I'm not denying your experience but as someone who retired early I have to say my experience, and that of my old work mates or family, has been the exact opposite.

mun1

good rounded advice here on pros and cons. 55 now , i would hope to wind down my hours to a 4 day week at 57 and then 3 days at 59 and then out at 60.

Ive a well paid but stressful Job with good pension of €60k+ per year plus lump sum at 60 and I would be a bit nervous about quitting work completely too early .

As one guy who was a bit listless when he retired after 45 year working said to me 3 weeks after retirement “every day is a bank holiday”.

Still Sticks in my head today.

Ted222

Having retired early from the day job of 40 years, I’d agree that it’s great not to have the daily grind.

However, if there’s one thing I’ve come to realise, it’s that you need to remain relevant - in whatever form that works for you.

The “every day’s a holiday “ mindset doesn’t last long and you need to have a plan for maintaining body, mind and soul.

SharkMX

https://www.boards.ie/discussion/comment/121995708#Comment_121995708

Im planning on retiring early if i can. Its a fair bit away but, Anyone ive spoken to (about 5 people who have actually done it and i trust to tell me the warts and all details) has told me that they are positive they did the right thing and couldnt imagine still doing someone elses daily grind. They can do whatever they want whenever they want.

The only downside that ive heard from a couple of them is that once friends and family know you are retired they seem to ask you to do favours all the time. Babysitting, driving people around, picking up from the airport, driving people to appointments, helping them paint, pet sitting, come work for our charity, sell some tickets for us. They tell me it took them a while before they felt able to say "Its MY retirement, not yours, and I dont have time for your errands".

If ever you were on the fence, watch this video.

SuperBowserWorld

I would say if you have any untreated mental health problems unrelated to work, then you need to start to address these before you retire, otherwise you'll end up facing your demons with no work to distract you.

banie01

If the figures work for you and they're sustainable? Go for it.

You have a decent pot built up and your lump sum offers you a decent immediate cash pile

One piece of advice I'd offer, is to have a plan to fill your time. Be it a hobby, some nixers, some part time work or even returning to education. Doing "nothing" can quickly lead to friction with one's partner aswell as being quite disheartening if you are used to being productive and having pride in your work.

Whatever you decide to do? All the very best with it and enjoy your retirement, whenever it comes.

Furze99

As regards taking 25% of your pension, presumably it's a PRSA type? I thought you had to nominate your retirement age when setting this up? That you can't just choose when it suits you. But maybe I'm wrong on that.

For ourselves, I think I'll be taking in income long after 65. All very well with a few bob from PRSA and state pension but living is getting more expensive all the time. How's your health insurance OP?

BraveDonut

If you leave your job at 57, could you not sign on for a year and get jobseekers benefit or do you have to draw down your pension?

zg3409

FActor in cost of health insurance if your employer is paying that now. That can be a massive new bill if you retire and need to pay it yourself. Often company health insurance covers both persons and it can be the difference between waiting years for a scan and a scan in a couple of weeks.

€24k per annum isn't a whole lot to enjoy your retirement with. I assume that's the "safe" option. You will safely survive and scrounge- annuities are a massive waste of cash for retirees.

You could reasonably expect much more if you put your pot towards an index tracking fund- risky and volatile in the short term but safe as houses (statistically far safer actually) in the long term. At 57 you'd have a life expectancy of 25 years, which definitely qualifies as the long term.

As far as what to do with your time, that's only a valid question if you have the retirement income to spend with your time . Once you do, shouldn't be too hard.

pavb2

With respect to retirement early or otherwise the comment that stuck with me and I know it’s a generalisation was ‘You can have the time or you can have the money but you can’t have both.’

bullpost

This is worth watching on how to pace your retirement.

https://www.youtube.com/watch?v=DMHMOQ_054U&t=17s

And dont forget you can now get 4% interest on savings with Banks such as N26 and its all EU guaranteed , so good option for your tax-free lump sum.

https://www.boards.ie/discussion/comment/121995584#Comment_121995584

You think he will spend 600k in 9 years? what?

Thats 66k a year, alot of people live perfectly fine on less than half of that (even with mortgage!)

Retirement is all about having things to do, you should have hobbies / interests built up throughout your life

Pity those folk that gave it all to their career, what a waste of time…

my plan to get a place abroad, I think it would be very hard to get motivated during the winter months the older you get !

https://www.boards.ie/discussion/comment/121995967#Comment_121995967

Where's phase 3?

BTW didnt listen to it all, couldnt listen to him talk about 'squeezing all the juice' all the time…

SnowWhale78

Firstly OP Well Done on getting to where you are now. Many people will not be in such a good set up at 55. If you can do it then go for it. I think the hardest thing will be trying not to think on the "What if" I was still working. After a while away from work you tend to forget the tough parts and remember the good things (I experienced this at least during a sabbatical from work).

If you do go ahead try honour the decision and make the most of it. There are pros and cons to everything but focusing on whats good about it will serve you better and thinking of anything you may be missing out on.

I am 45 currently and aiming to also retire at 55ish. My biggest challenge is trying to determine a lifestyle I would be happy with. It wouldn't be the one I have now based on my pension forecast but where would I be happy with if say I lived 25-30 years after that? For example been able to go out and eat a few times a week or only having that option once every 2 weeks? I think its such freedom of spending choices we have when working that become somewhat limited when we retire.

CelticRambler

I'll be 57 this year and am effectively "retired" for the last twenty years; still not short of things to fill my time! :D As I had/have no pension to count on, I do a bit of intermittent salaried work, about 16 weeks a year, but I find it's a struggle to fit that into my schedule of more interesting/useful/productive activities.

Further to what several others have said, and like with many other changes of life, what's most important is that you're not "running away" from your current situation, but "running towards" something else, otherwise you will end up creating and/or replicating many of the negative aspects of the present. It's also really important that both partners in the relationship are in complete agreement about the how and when the situation changes.

As for the financial side, one of the great advantages of being "retired" is that you're no longer tied into spending money because money has to be spent - provided you don't simply swap one costly habit for another. E.g. you'll be spending a certain amount on travel for your weekly commute, as well as trips to the shops, social and sporting events, weekends away, etc.

If you've "all the time in the world" it'd be easy to fall into the habit of jumping into the car and heading off to the hardware for that one piece of moulding you need to finish the job, or down to the shops for that one ingredient you're missing for tonight's dinner, or half way across the country to pick up that great bargain you found on DoneDeal … when you could just as easily put off each of those journeys, do them all in a single trip over the course of a long day and save yourself the cost and time of several km's worth of driving. Similarly, if you pace yourself in your purchases, you can save a lot on equipment and materials by having a permanent wish-list and then wait for the product to become available at the right price.

BalboBiggins

https://www.boards.ie/discussion/comment/121995716#Comment_121995716

That's an interesting quote. Did he mean it in a positive or negative way?

naughtysmurf

https://www.boards.ie/discussion/comment/121995989#Comment_121995989

that’s not how pensions work, re-read his post

yagan

I'm approaching mid 50s and from what I've seen of others who have retired after a full on lifetime of work is those who dismount too quickly seem to have a lot of issues like depression and general ill health.

If money isn't an issue then the priority seems to be transitioning to a different pace of life and getting used to setting your own goals and targets in the absence of an employer doing it for you.

We're kinda starting into that next phase, we now have a garden that's a challenge, and we're thinking campervan for touring Europe in the long run, although I fancy trying cycling a eurovelo route.

https://www.boards.ie/discussion/comment/121996558#Comment_121996558

I just did. he never mentioned any thing else. Particularly about how pensions work?

Can you enlighten me please?

https://www.boards.ie/discussion/comment/121996666#Comment_121996666

like I said it’s all about interests/hobbies..

You dont need a fortune to retire if you have this.. like the poster who said he would burn through 600k in 9 years..

SharkMX

You can draw your private pension at 50.

A financial planner will sort that out for you. You cant get the OAP til 66.

I forgot to add this link in my earlier post. Might want to give it a look if you are on the fence.

https://www.google.com/url?sa=t&source=web&rct=j&opi=89978449&url=https://www.youtube.com/watch%3Fv%3DOuDCDp9Z9Y4&ved=2ahUKEwirzIvxj7WFAxXnQEEAHSCYDr8QtwJ6BAgUEAI&usg=AOvVaw1uIsPI6joBarjnneqJ3EBl

yagan

https://www.boards.ie/discussion/comment/121996684#Comment_121996684

Yeah, I hear some people fret about not being able to afford retirement and when I ask them why they think that way it always seems to circle back to them not knowing how to fill their days, so being able to afford distractions like long cruises is a priority.

Whereas for me a couple of weeks by a pool in Tenerife in Jan/Feb would be enough to keep the winter blues at bay. The rest of the time I'd be happy doing as I do now, a bit of exercise, a bit of garden, a bit of everything.

naughtysmurf

https://www.boards.ie/discussion/comment/121996668#Comment_121996668

unless I’m misunderstanding, he doesn’t mention any other savings just a potential pension pot of 600k & his wife earns 30k

If he retires & takes the 150k tax free he’s got 150k in cash plus buys an annuity or ARF with the remaining pension pot of 450k, the annuity will be in or around 22/24k as he says (4/5%of 450k)

So he’s going from paid employment of ? to let’s say an income of 2k a month & 150k savings in the bank.

Even he he was very disciplined & took 10k of his 150k every year to bump his monthly by 800 a month until his state pension kicks in, his 150k would be gone in ten years & all he’d have then is the state pension from 66

There are loads of potential future costs, they could both live until their mid eighties or longer, as mentioned, health insurance, car ownership if they have one plus just the day to day costs of living & home ownership before you look at leisure / travel & other nice stuff

I’ve no problem with him doing it, just saying do your sums & if you’re happy with the lifestyle that income will give you and it suits you, grand but I’d recommend getting proper professional advice too

Jim_Hodge

https://www.boards.ie/discussion/comment/121996440#Comment_121996440

I've heard it used both ways but to me it's a huge positive.

https://www.boards.ie/discussion/comment/121996858#Comment_121996858

well it’s not potentially 600k, it is 600k :)

But you have to include the state pension aswell.. I know it’s not a certainty, that’s why it’s so hard to calculate how much you need..

Any formula out there to calculate it?

most people would need less when they retire as they would not have mortgage, kids, travel to work amongst other stuff.. I would think 2k a month is sufficient, depends o what you want to do really.. as a poster said if you want to go on a massive cruise every few mths then yeah you will need loads, but months in Tenerife every winter you end up saving money, less electricity, heating cheaper food etc

look at the last vid posted.. some good info there, where he does state ppl can overestimate how much they need!

yagan

Another quote I like is "if you enjoy wasting time then it isn't wasted!".

I'd hate to facing full retirement thinking every day not working has to have validation.

Iguarantee

https://www.boards.ie/discussion/comment/121995967#Comment_121995967

4% gross or net?

Revolut offer >5% gross but it’s only ~2.4% net…. Big difference!

bullpost

https://www.boards.ie/discussion/comment/121997139#Comment_121997139

Its gross I believe. Its only available with their premium "metal" card which costs around €20 a month.

naughtysmurf

https://www.boards.ie/discussion/comment/121997053#Comment_121997053

I will look at the video later, my gut tells me though that by 66 the 150k could well be gone & yes replaced by the state pension at 66

57 is very young to be restricting your income to 34k for 9/10 years or potentially a lot longer imo assuming he’s coming from a decent higher salary & that will be an adjustment in itself & factor in inflation too & yes it’s hard to calculate & everyone is different, personally I hope to be gone Jan-March to warmer weather

https://www.boards.ie/discussion/comment/121997290#Comment_121997290

You must be on a massive wage, 34k a year = just under 3k a month - must have an expensive coke habit or something lol

I would say 34k net = 50 - 55k salary.. this salary is above the average, plus you dont have all the expenses I mentioned b4..

But yeah each to their own, if you have expensive tastes then you will need a lot more. But I assume ppl with expensive habits would be earning alot more, therefore should have a bigger pension when they do retire..

Quick calc, he retires at 57 with 150k lump sum, and if he wants to maintain 2k a month, he has 450k for this

He will get state pension at 68 (isnt it now?), therefor 24k for 11 years = 264k

Then the remaining 214 he will have state pension of approx 1k a month, therefore only needs 12k per yr out of the 214 which will last him approx 18yrs - up until he is 86…

Not bad really..

Making alot of assumptions here, that his pension does not fall in value, the state pension still exists, he doesnt have any major expensive health concerns, inflation etc..

But when talking about retirement you have to, its always a risk..

nothing stopping him doing mixers, or part time work after 5 yrs (when he's 62 for example), or moving abroad where his money would go alot further..

I would love to retire when Im 60, and am making financial plans for that.. who knows if the amount I have by then will last til I die.. I could die when Im 65 or 95!

Edit: sorry made a big mistake in calc above, he will have 186k left by the time he is 68, so will have 12k for 15.5 yrs, so up until he is 83!

Jim_Hodge

Just with regard to the lump sum. I know from personal experience and discussion with other retirees that many don't make huge inroads into it. It's actually surprising how you don't need as much as you imagined when retired.

https://www.boards.ie/discussion/comment/121997447#Comment_121997447

Agree, that 150 could invest in a property abroad… live their and save a fortune :)

yagan

https://www.boards.ie/discussion/comment/121997490#Comment_121997490

My only fear with that is what happens when living abroad and there's a health complications. I've pondered such a move and looked at websites about retired Brits in Spain/France/Portugal and a recurring theme seems to be is all mostly goes well until it disasterously goes wrong.

I'd rather downsize than give up my primary residence in Ireland. Besides I lived in oz for years and heat has its own tedium after a while.