Early Retirement at 57

reggie3434

aye living ur life to retire and thinking it will magically be brilliant is not healthy but neither is burying the head/ hopping off pcp deals/ full sky packages and then having to work after you retire. Those articles are just fluff pieces, I do enjoy chatting about it though!

Hotblack Desiato

https://www.boards.ie/discussion/comment/122728566#Comment_122728566

More comfortably than a lot of dual income families with kids! and the retort to that is "when you're working, you can always increase your income" but that's not true for a lot of people, and meanwhile their outgoings are at the mercy of rent / interest rates / childcare.

Bass Reeves

https://www.boards.ie/discussion/comment/122731469#Comment_122731469

A little of things are about personal responsibility. People with decent pensions made decisions that left them in the places they are. Many now that are in the situation with decent pensions left home at an age when nowadays children are have not done there junior certificate. They had to make a life for themselves from there.

bilbot79

https://www.boards.ie/discussion/comment/122730103#Comment_122730103

A lot of people go through their careers unburdened by the high stress, deadline driven, long hours jobs that have to come with higher salaries. I often ask myself if I've done the right thing trying to go down the 'successful career' route and I admire people who find themselves a comfortable niche with decent cash but lower demands. Those are people who have sacrificed some salary and pride in exchange for a more sensible work/life balance and are the kind that you'll find enjoying a Sunday pint without the dreads for Monday. It's not necessarily job satisfaction that is attractive there, rather it's life satisfaction because the job doesn't overrun the person. This approach is heavily facilitated by our tax regime that rewards lower earners and punishes higher earners.

The flipside is without the extra cash the retirement plan gets tanked, especially the early retirement plan. I'm of the type that wants to take the pain now and get out early while I still can rather than drag it out at a lower level for longer. These choices exist the world over, even in Russia people could traditionally choose to work 20 years hard labor in Siberia and receive the state pension early in exchange.

It's partly true that you won't be as fit, healthy and energetic in retirement but if you make parallel investments in your body and diet etc you can have a lot of go-go years and I'm sure if you made a comparison between the number of quality hours available to a retiree over 10 years with a young energetic worker over 25 years you'd be surprised.

Jim_Hodge

https://www.boards.ie/discussion/comment/122731869#Comment_122731869

😀Bilbo, there is a happy medium in life. Not everything, nor everybody, has to be at either end of a scale. You can be successful in a job, move up the ladder, earn good money, contribute to a pension, and enjoy working, have a good family life, have a pint on Sunday and not destroy your health.

bilbot79

https://www.boards.ie/discussion/comment/122731893#Comment_122731893

😊 Give me that job.

That sounds perfect but when you look under the hood there will be a compromise somewhere or other. Maybe such a person compromised on their dream house or their retirement age or something like that (or the number of Sunday pints)

Jim_Hodge

https://www.boards.ie/discussion/comment/122732088#Comment_122732088

You're convinced in that view, so carry on. But I can tell you there is a very happy medium available. Enjoy!

suvigirl

https://www.boards.ie/discussion/comment/122732097#Comment_122732097

You can't collect the state pension at 63 though, so how will you manage?

kippy

https://www.boards.ie/discussion/comment/122731869#Comment_122731869

I don't disagree in general but how do you think people sacrifice pride to have a more sensible work/life balance?

Expunge

https://www.boards.ie/discussion/comment/122732393#Comment_122732393

Any chance you could expand on the winters abroad part of your plan, please? This really appeals to me but, when all is factored in, is it truly a saving?

Thanking you.

Jim2007

https://www.boards.ie/discussion/comment/122732108#Comment_122732108

Don't let the noise distract you from what is important. It's not much fun sitting at home watching the grass grow while everyone one else is off in Spain playing golf, cruising down the Rhine down the Rhine, visiting the Greek Islands or whatever.

Jim2007

https://www.boards.ie/discussion/comment/122732692#Comment_122732692

Ireland is an expensive country, if you can spend the winter in say Portugal it will be cheaper and depending on the country you may end up paying less taxes as well.

Jim_Hodge

https://www.boards.ie/discussion/comment/122732739#Comment_122732739

Oh come off it. Even people on relatively modest pensions get to enjoy holidays at home and abroad. And, not every person's ideal retirement is holidaying. In fact travel can become boring and 'sameish' after a few years. I'm not aware of any retirees, in reasonable health, sitting at home bored. Every day's a holiday.

reggie3434

https://www.boards.ie/discussion/comment/122732809#Comment_122732809

that pride comment struck me too, I used to strive to better my career but you get so much stress up the ladder, went back down and am much happier with the free time, played golf there today. I don't define myself by my job or worry bout keeping up with the jones, no one really cares anyhoo.

readoutloud

Savings guru, always planning for a retirement that he will never get to enjoy. There's a lesson here.

https://www.nytimes.com/2024/07/13/your-money/jonathan-clements-cancer.html

Your pension, all things going well and no severe market fluctuations or bomb out, will last until 77. I woukd advise against it unless you have other revenue

reggie3434

https://www.boards.ie/discussion/comment/122734718#Comment_122734718

Thank you for teaching us o wise one

Jim_Hodge

https://www.boards.ie/discussion/comment/122734772#Comment_122734772

Who are you talking to there? Mine will certainly see me well past 77.

https://www.boards.ie/discussion/comment/122734852#Comment_122734852

To the OP.

elperello

Jonathan Clements own words about his diagnosis and reflections on life and imminent death.

https://humbledollar.com/2024/06/the-c-word/

Quitelife

people once they hit 55 need to start winding down , most people are in good shape up to 70 but after that for the majority they are not in good shape to enjoy life

bilbot79

https://www.boards.ie/discussion/comment/122732539#Comment_122732539

Well I mean they might reign in their ambitions and allow their peers to leapfrog them etc

Quitelife

https://www.boards.ie/discussion/comment/122734917#Comment_122734917

thanks for thoughts … there’s a piece of me happy to get to 77 with reasonable income and rely on state pension at 77 if I’m still around … can’t imagine my needs been much at 77

Oscar_Madison

https://www.boards.ie/discussion/comment/122732733#Comment_122732733

Totally. That sunshine, being near the sea- it certainly lifts the spirits in the young no less the old or elderly.

Winter in Ireland is probably my biggest dread when retired - I’d plan to leave the country between November and February if at all possible - I’d be happy pottering around Ireland for the rest of that time.

People are going to be living a lot longer in the future, you also have to completely support yourself up until at least age 66 before state pension kicks in. Who says you won't need to cash a lump sum out from time to time of which will be taxed. If you want to retire early I would be aiming for a pension fund of at least 1.5 mill asap.

Quitelife

https://www.boards.ie/discussion/comment/122740593#Comment_122740593

that’s a lot of money for most people … I’ll have to make do with 600k

Bass Reeves

https://www.boards.ie/discussion/comment/122740593#Comment_122740593

Is that 1.5 million in a present, 10 years or 30 years time fund. Over 30 years. Over 40 years @a grogrosth Rate of 6 % it woukd require 12.5k/ year in contributions spread evenly. Unless your employer was making g substantial contributions it would be a non runner.

As for making significant lump sum withdrawals these are not tax efficient. With any fund you have the option of taking 25% In a lump sum 200k is tax free and next 300k is taxed @20%. A fund of 1.5million gives a 375k drawdown of which 35k is paid in tax giving 335k after tax leaving a fund of 1.125 million. 4% drawdown is 45k/ year which is approximately the lower tax limit at present.

If You leave it in an 50% equities fund it will still average probably 6% growth. However you have to ride the highs and lows ofvthe market and only draw 4% whether it's up above or below a million. Because of the levels of contributions I cannot see such a fund being possible unless you are in your twenties and have 40 years of a above average income

chicks4free

Is anyone buying property with self administered pensions?

Peregrinus

You can do this, but there are restrictions.

• You can't buy a property to develop and sell on; it has to be a long-term buy-and-hold investment.
• Arm's length transactions only; your SSAP can't buy a property from yourself, a family member or an associate, and while the fund holds the property it can't be let to, occupied by or used by you, your business, your limited company, your family members, your associated. It has to be let on market terms to a person who is in no way connected to you.
• Your fund can't borrow. So you'll need to have enough in the fund to complete the purchase without any borrowing.

Also, from an investment point of view, most advisers would say that investing your retirment fund wholly or largely in a single property would represent an unacceptably risky concentration of investment. If your fund is very large indeed it may have enough money in it to buy a property that represents a small part only of the total fund, but not many people would be in that happy position.

So, while it is possible for an SSAP to invest directly in a property, for all these reasons it probably doesn't happen very often.

Jim2007

https://www.boards.ie/discussion/comment/122803539#Comment_122803539

People got burned investing in property in 2008, not because of the banks, not because of the government nor the bond holders…. but because they did something incredibly stupid, they ignored all the best practice when it comes to investing:

• They borrowed to invest
• They failed to diversify their investment
• They invested in an illiquid asset
• They invested in probably the highest asset class available to the average punter
• They invested in a high risk asset class with a low rate of return
• They ignored the asset allocation rules and instead of keeping property at 6-7% they went 100% in!

Now had they ignored all the hype, they would have avoid this, but they did not and they have not learned the lesson and will happily blame everyone but themselves for their situation.

So if you decide to ignore all the best practice and buy a property, it may work out for you, but it may not. And if it does not, the the reality is you have no one to blame but yourself.