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Early Retirement at 57

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  • Registered Users Posts: 275 ✭✭pauly58


    You have to have a hobby or interest to get up in the morning for, my Grandfather didn't, he got up, sat in his chair until lunch, then did the same until tea. He was dead at 66.





  • Im assuming they already have a primary residence in Ireland, and they are using the 150 to buy property abroad, live there for 5/6 months of the year (winter) and save a fortune..

    Anyway, 2k a month is alright, but in years to come 2k wont be worth as much as it is now.. but sure ya could be dead by then…

    Impossible to know the future.. its a tough one to know what to do.. but if your sick of your job / commute and all that, fook it go for it.. can always do the part time if necessary..

    My parents did that, father retired at 63, and lived the winter in Gran Canaria for 18 years, definitely helped the health an awful lot, you can see it in them..



  • Registered Users, Registered Users 2 Posts: 3,823 ✭✭✭yagan


    There's definitely a lot to be said for shaking the Irish winter chill out of the bones as we age, and winter breaks are definitely part of future planning. Plus even though I'm early 50s and spend a good bit of time working outdoors my doctor put me on vitamin D after the months of overcast we've had since last June!

    Post edited by Boards.ie: Mike on


  • Registered Users, Registered Users 2 Posts: 1,315 ✭✭✭Viscount Aggro


    You need 2m in a pension pot these days. That's quite normal in professional circles.

    Take 4% yearly income.. that's 80k.. that would be good enough to live on.

    Forget about the state pension.. it will likely be means tested.





  • Not many are gonna have 2m (including myself), no where near it. Where did you get that from?

    Well means tested is not fair way of doing it, how about 2 people on 50k, one spent all their life and the other saved!

    The individual who saved will get a reduced state pension?

    They both paid the same PRSI contributions!

    I doubt it will happen that way..

    And again a person who earned say 30k, compared to the individual who earned a 100k.. so the guy who earned 100k would get less state pension? but he would have paid more PRSI!



  • Registered Users, Registered Users 2 Posts: 2,086 ✭✭✭paddydriver


    I think he/she is trolling.. very few out there are going to have anywhere near €2M in a pension pot and no Gov would be crazy enough to means test the state pension - they'd be wiped out clean in following election.



  • Registered Users, Registered Users 2 Posts: 3,513 ✭✭✭Masala


    You will still have bills…

    VHI €1600 for you..€3200 for both. Car Insurance €500, House Insurance €500, Life Insurance €150. ESB €2,000, Heating €2000. Sky €1,200 Thats nearly €10k out of your €24k… leaving over €1000 a month to live on outside of your wife's take home.

    you won't be travelling the world on that, or buying a new car or kitchen etc… unless you want to dip into savings



  • Registered Users, Registered Users 2 Posts: 1,315 ✭✭✭Viscount Aggro


    They will spin it by saying .. we will have to push out retirement age to 68 or 70, to be able to afford state pension. Or that everyone deserves a living wage. Some other socialist claptrap.

    The 2M figure is the SFT - standard fund threshold. Lots of retirees are up at this level.



  • Registered Users, Registered Users 2 Posts: 3,455 ✭✭✭Patrick2010


    Fair play if you have that, I won’t be near that and I doubt few I know have. Mortgage paid, could easily live on 20k a year but I don’t have an expensive lifestyle. You reckon you need 80k a year to live without even touching the two million?



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  • nah, over expense there.

    I like the way you dbl the health ins for 2 people, but keep all the other expenses as full for the 1 person to pay lol

    1600 Health I dot pay that much

    Not 500 for hse ins

    4000 for heating and electric - wow I’d say I pay maybe 2500 a year.. plus if you live abroad for the winter that goes down a lot!

    Do t have sky, would never pay for sky- Jaysus!

    More correctly, for 1 individual, abt 1200 for health ins, 250 (if it is 500 a yr!) hse ins, 500 for car ins (as each prob have own car) 1250 for heating and elec. you 10k has gone down to 3250 :)


    and as already said if you do want to travel the world, expensive cruises every few mo tha well yea of course you will need a lot more!





  • ya see, ppl Way overestimate what they need. I know he was exaggerating but you need to be realistic!





  • what does lots mean :) how many out of the entire workforce in Ireland are going to have 2m :)

    single digit %

    Well all be working til we die at that rate…



  • Registered Users, Registered Users 2 Posts: 7,659 ✭✭✭SuperBowserWorld


    2M



  • Registered Users, Registered Users 2 Posts: 3,823 ✭✭✭yagan


    I know a few who'll have 2m and more in their pot on retirement, but they're workaholics who'd die rather than retire.

    Even if they retired they're the type who'll buy some run down old grand house and then threat it as an investment project which they'll never relax in.





  • They'll be the ones that die of depression few yrs after they retire, as they have nothing else in their lives..



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  • Registered Users, Registered Users 2 Posts: 2,070 ✭✭✭bilbot79


    I agree with this. My plan is for 2.15m. I have 230 as it stands and putting in 2800 a month in total and geared to high risk funds. 45 years old and if I can eek out some wage growth along with 10% investment growth I could do it. Time will tell






  • Market crashes and your f❌❌ked then lol

    you may agree with wanting to have 2m, but he said a lot of professionals WILL have this by retirement!! Which is incorrect..

    Of course they will probably increase retirement age to 70, can’t see it going beyond this, otherwise y’all have no retirement then other than when your too Old to actually do anything

    Means tested I’ve already shown why this could. Not happen





  • obviously trolling or he doesn’t know what he’s talking about

    SFT has nothing to do with the amount for retirement.

    A quick google

    https://nationalpensionhelpline.ie/pensions/standard-fund-threshold-ireland-complete-guide/#what

    In the words of the Irish Government“the Standard Fund Threshold is a ceiling on the total capital value of tax-relieved pension benefits that an individual can draw upon in his or her lifetime from all of that individual’s pension arrangements”

    Put simply, there’s a limit on how much can be in your pension pot and if you exceed that limit there are some not-so-favourable taxation consequences.

    A warning to @bilbot79 - dont save too much :)



  • Registered Users, Registered Users 2 Posts: 2,070 ✭✭✭bilbot79


    The market could well crash around the time I turn 60 but if it does I'll just work longer till it recovers.

    Post edited by Boards.ie: Mike on




  • goes against the whole point of this thread - retiring early

    You may never reach retirement then!



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  • Registered Users, Registered Users 2 Posts: 2,086 ✭✭✭paddydriver


    45 y/o now with 230k in pension and you want to get to €2.15M… you've a lot of years to go even with €2800 a month. High risk funds will be hit quickest and hardest in a downturn and there is every chance of that at some stage in next 10-15 years (or before you get to retire).

    Best of Luck with it though.. 💪





  • yeah, to get to 2m (-230) saving 2800 a month will take 52 yrs lol you could knock off a few years if investment goes up :)

    You’d need to knock over 25 yrs off that by increases in investment to be able to retire at 70!

    Have you actually thought about this, or just plucked numbers out of the air! Ya need some financial advise!Good luck with that!



  • Registered Users, Registered Users 2 Posts: 1,977 ✭✭✭mulbot


    OP, I've an uncle that retired at 55,said it was the best thing he ever did, he had 2 apartments bought out in Spain by that time, he lives in 1 of them for about 5/7 months a year, his family use it at different times of the year, the other is rented out, no idea of his pension amounts or what cash he had etc, he potters about now with classic cars, buying and selling for a bit of extra cash. Can't believe anyone would advise to stay working if they don't need to, especially if you get stressed doing it. Good luck



  • Registered Users, Registered Users 2 Posts: 3,281 ✭✭✭naughtysmurf


    what’s the OP’s wife’s savings & pension set up like as that will affect things too & maybe not positively?



  • Registered Users, Registered Users 2 Posts: 2,070 ✭✭✭bilbot79


    It's completely feasible in a 10% average growth scenario which is typical of stocks in the long term.

    Stick the figures in here: https://www.calcxml.com/do/interest-calculator?skn=#results 230k starting deposit, 28750 annual savings, 5% per year contributions growth (wage rises and rising tax free thresholds at 50+) and 10% compounding interest.

    2.2mil



  • Registered Users, Registered Users 2 Posts: 2,070 ✭✭✭bilbot79


    Heehee lol lol

    Might be you that needs financial advise :)





  • your making a lot of assumptions that you will have a consistent increase year on year..

    Don’t know how 840k (2800 x 12 x 25, retire at 70) is going to nearly triple by compound interest lol

    do investments use compound interest!

    Do you seriously believe that?





  • dont worry lads were all sorted, compound interest will save us all…



  • Registered Users, Registered Users 2 Posts: 5,007 ✭✭✭griffin100


    I always aimed to retire at 60 (I’m 51 now) but as more and colleagues and friends / family hit 60 they don’t seem that old and it now seems young to retire. In any event there was a screw up with my public sector pension and I was put in the wrong scheme for years until the error was spotted and so retiring at 60 is now not financially viable for me unless my appeal against removing me from the scheme is successful.

    That said the pension I’ll get at 65 will be very substantial along with a hefty lump sum, and added to that there’s the state pension and a UK pension I’m going to get. Whilst 60 now seems youngish, I’m worried that 65 will be too old to enjoy retirement and do the things I want to do. Whilst I’ve said friends at 60 now seem young, I’ve had three colleagues / friends die in the last year aged 42, 49 and 60. You can never tell what’s ahead. I try not to overthink it 😁



  • Registered Users, Registered Users 2 Posts: 2,070 ✭✭✭bilbot79


    Yes. That literally is it. Compound growth is how pension investing works. And the figures can be astounding, particularly in the last couple of years e.g. If you get to 1.5mil and that year returns 10% you'll get 150,000 in growth alone plus whatever you add to it. It snowballs.

    Compound interest will save you my friend.

    Post edited by Boards.ie: Mike on


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  • If you're spending well north of 300 quid a month for electricity and heat, the problem isn't your income, and you should be seriously upgrading your home to cut that by at least 60%. Likewise, 1,600 a year for health insurance is simply too much.

    You can be rich on 40 grand a year and you can be poor on 100k. A lot depends on what you do with your money, and many people flush a lot of it down the toilet by buying shiny crap- cars, phones, etc..

    That applies whether you're working or not.



  • Registered Users, Registered Users 2 Posts: 964 ✭✭✭mun1


    negative way , as in there’s a lot of time to fill in





  • ok , so you honestly believe 840k is going to turn into 2m.. for every 1 euro you invest you will over double your money lol

    You honestly can’t believe that?

    id say you looking at 1.1m, maybe 1.3 if investments are good..

    how long have you been contributing to your current pension to only have 230!



  • Registered Users, Registered Users 2 Posts: 2,070 ✭✭✭bilbot79


    Yes. That's what I think. That's what 10% growth and an average of 5% contributions increase will get according to the math.

    There is the risk of a downturn at the wrong time but they are generally relatively shortlived and if that happens I will just keep working

    Post edited by Boards.ie: Mike on




  • It won't save them. They're an idiot, and there's no saving an idiot...







  • Registered Users, Registered Users 2 Posts: 6,903 ✭✭✭CelticRambler


    Retired Brits are a special case. A huge number of them (pre-Brexit, at least) stayed signed up with their NHS GP and their NHS optician and their NHS dentist, and made/make trips back to GB for all their regular healthchecks. These'd be mostly the same people who never bothered to learn French/Spanish/Portugese, import/ed their groceries from Tesco or Sainsbury and were/are generally detached from whatever community they're living in - unless it's an immigrant Brits' enclave. Healthcare things do tend to go disastrously wrong for them when they're suddenly forced to join the real world and a trip back to Blighty is a physical impossibility.

    The rest of us over here on the Continent go to the local doctor when we need to (17€55 per visit in France, if you're properly in the system), get our vaccines and prescriptions like you do, and get sent for x-rays/blood tests/colonoscopies/surgery/rehab just like the natives. I know three British guys who've had "health issues" in the very recent past (1xstroke+carpal tunnel, 1x prostate cancer, 1x detached retina, cataracts and severe conjunctivitis) all treated promptly and effectively in France. You wouldn't have heard of any of them, because they all lead bog-standard normal lives and attract little attention from the likes of A Place in the Sun.



  • Registered Users, Registered Users 2 Posts: 1,462 ✭✭✭dunnerc




  • Registered Users, Registered Users 2 Posts: 3,455 ✭✭✭Patrick2010


    I pay virgin media 100 euro a month for tv,broadband and phone



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  • Registered Users, Registered Users 2 Posts: 3,269 ✭✭✭Kaisr Sose


    Its highly unlikely you will avg 10% growth each year. Some years it will be less. As you move closer to retirement, the financial advice would be to.shore up what you have and derisk..These less risky funds won't give you 10% and its the later years where you seem to be banking on the huge growth via compound interest.

    Anyway what really strikes me is you saying plan B is to defer retirement. Thats an even worse plan.

    Post edited by Kaisr Sose on


  • Registered Users, Registered Users 2 Posts: 2,070 ✭✭✭bilbot79


    It's more that I defer early retirement if plan A fails. I see it that I'll still be in risky funds at the time rather than tapering.

    At the end of the day though, if you are 60 and don't want to work anymore you'll look at what's in front of you and ask yourself is it enough. I have the 2.15m target because

    1. It's the limit
    2. It's a lovely amount to keep you for a long time
    3. It's plausible for me in a high risk scenario (depending on markets)
    4. One needs a goal



  • Registered Users, Registered Users 2 Posts: 1,462 ✭✭✭dunnerc


    I pay Zgemma combo box 100 euro, sky dish 30 euro , saorview aerial 20 euro .One off payment 150 euro .

    Virgin media 500gb broadband 35 euro a month , 420 a year + 0ne off payment of 150 for free tv channels + 6.99 a month to 48.ie for unlimited phone and texts and 100gb data .





  • Of course some years it will be less. That's what average means. And bilbot is talking about annualised return. The nasdaq 100 annualised return since 1986, net of annualised inflation, is 11%. Disregarding inflation, history is very much on bilbots side re the more popular s&p 500.

    Standard advice is 60% equity, 40% bonds piling more into bonds as you approach retirement. It's good advice over the short term but it's terrible advice over the long term. High return indexes are volatile. Low return options are stable- which in this context is another way of saying stagnant...



  • Moderators, Business & Finance Moderators Posts: 17,807 Mod ✭✭✭✭Henry Ford III






  • last things. You can only contribute a certain % of you salary to a pension.. so I doubt you could be contributing 2800pm..



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  • Registered Users, Registered Users 2 Posts: 6,893 ✭✭✭Allinall


    You can contribute as much as you like.

    There is a cap on the tax relief you can get, depending on your age.

    Post edited by Boards.ie: Mike on


  • Registered Users, Registered Users 2 Posts: 2,070 ✭✭✭bilbot79


    Exactly. My company is paying 600 odd and I'm paying 2200 which is only costing me around 1320 after tax.

    Pension = the ultimate get rich slowly scheme



  • Registered Users, Registered Users 2 Posts: 26,846 ✭✭✭✭Peregrinus


    It would be a mistake to think that the risk posed by volatile returns ceases when you retire, though. On the contrary, it becomes more acute, as you will no longer be able to respond to lower-than-expected returns by deferring retirement (you have already retired) or by increasing contributions (you are no longer earning).

    So, while in retirement, you want your fund invested in low-risk assets whose returns are less volatile.

    But here's the thing; you don't want to have to switch from higher-risk volatile assets to lower-risk stable assets in one giant leap at the point of retirement. If that happens at a time when the high-risk volatile assets are in the downward phase of their volatility, you're permanently locked in to that lower valuation. It makes huge long-term difference to the level of your retirement income.

    It's no answer to say that you will defer retirement until the markets rise again; you may not have a choice about the timing of your retirement if it is occasioned by ill-health, for example, or by a badly-timed redundancy.

    So, the received wisdom is that you progressively switch from the higher-risk assets to the lower-risk over a period — say, about 5 years — leading up to your expected retirement date.

    The other point worth thinking about is your twin assumptions that you'll get an average return of 10% a year and that your contributions will rise by 5% a year.

    Why would your contributions rise by 5% a year? Because you expect (or at least hope) that your earnings will grow, is my guess. And of course they almost certainly will; historically, earnings do grow from year to year. Why? Inflation is why.

    Effectively, you're assuming 5% wage inflation there. But of course wage inflation also implies price inflation. You project that at the age of retirement (which, IIRC, is in 15 years time) you'll have accumulated savings of €2.15 million. But what will €2.15 million be worth in 15 years time?

    Given your assumed 5% inflation rate, the answer is "about €1.24 million in today's money". Not a trivial amount, but a good deal less than €2.15 million. And, if you're aged 60 today, your life expectancy (if you're male) would be about 22 years 5 months. (Higher if you're female.) By the time you actually reach age 60, that period is likely to be a bit longer.

    So, you have to ask yourself, will the equivalent of €1.24 million be enough to keep me in champagne and oysters, or at least in beer and baked beans, for 22 or 23 years? But even that is not really good enough; having enough money to last you for the average life expectancy for a person of your age and gender gives you a 50% chance of running out of money before you die — possibly many years before you die; you could easily live to, say, 90 or 95. Plus, do your retirement savings have to keep not only you but also your spouse/partner, should they live longer than you?

    The message here is not that we're all doomed, financially speaking; it's that we need to think realistically about what income we will actually need or want in retirement. If you own your own home, don't have work-related expenses, and enjoy gardening, going for a stroll, having a quiet pint of an evening, and other recreations that can be pursued at a modest cost, €1.24 million can be stretched for a long time. If your ideal retirement involves wintering in Biarritz every year, buying yourself a new car every two years and flying first class everywhere, you have a bit of a problem.

    The thing you need to ask yourself is, will my projected retirement savings be enough to pay for the kind of life I want to have in retirement? In considering this question it's really not helpful to model the nominal figure you calculate your savings will accumulate to. €2.15 million looks like a stupendous amount of money, but you can be sure that by the time you actually have it, in 15 years, it will look a lot less stupendous. So don't think in terms of getting a 10% return; think in terms of the real return (i.e. the return in excess of inflation) that your savings can earn. The figures you get from calculations like that will give you a much more realistic feel for how wealthy you will be.



  • Registered Users, Registered Users 2 Posts: 1,457 ✭✭✭SharkMX


    I was out with a few people I used to work with last night and one of them was retired and he was in his 50s.

    During the night, since this thread was fresh in my mind, I quizzed him about it. He said he would talk to me in more detail again if i was interested in doing that myself.

    I will try and summarize it here, but there was alcohol had :)

    He retired when he was 53 (The same year he was finished his mortgage). He is 57 now.

    His wife retired too at the same time as him. They have grown up children.

    The year before they had retired they had expenses that they then didnt have after they retired (only rough figures i can remember). €1400 Mortgage, €1000 pm into pension, €500 pm savings, Car loan €250 pm, €100 for parking near work, fuel, €100pm for commuter ticket and a few more that I can remember.

    He said when they retired they didnt have mortgage, were not adding to pensions, were not adding to savings anymore as it was coming out instead of in. And their car loan was finished about 2 months after they retired too. They also went down to one car and traded the 2 cars for 1 newer car. So they had already about €3500 less on outgoings.

    There were other costs that i cant think of now that he said just vanished too.

    Now they go on more holidays than they used to because they can just check the cheapest off peak prices and book them on the spot. So they do that a lot. Probably a break once every month or two to Spain, Italy, Greece apart from in the summer.

    They havent even taken their lump sums yet because they are still living on savings so their pensions are actually still growing. They will take his lump sum and draw his pension in about 2 years. When that cash gets low they will activate her pension.

    For bills he said he actually spends much less, for much more holidays overall. Electricity and heating is about double but it doubled anyway for everyone over the last few years, so he cant tell how much extra from both being at home. And they are away a good bit of the winter now.

    For lifestyle he put iot to me like this - "I can now do whatever I want. I can sleep in if I want, I have zero stress, I could even work if I wanted. But I find I am relaxed all the time and never in a rush or concerned with anything to do with a job. Whats not to like"

    I asked were there any downsides and he said there was one. He said he felt guilty saying "Sorry, i cant, im off on holiday that week. when his children asked if they would mind the grand children. And the wife loved minding the grand children as much as possible"

    All in all it seemed very positive. I will have a much longr conversation with him when i get the chance but I was inspired. I know others who have done this but didnt get into as much detail with them about it as he was going into. He knew all the figures off the top of his head and said he has a spreadsheet he will send me from his last 5 years before retiring. One thing im very aware of is that none of them regret it at all. And anyone who ive ever heard questioning why anyone would ever want to retire early arent and will never be in a position to do it themselves so it always seems like an "i never loved him anyway" sort of comment from them.



  • Registered Users, Registered Users 2 Posts: 6,108 ✭✭✭Trigger Happy


    I will be retiring early too but leaving it until I am nearer 60. When you take out mortgage, cost of work, cost of kid I will have more disposable income after tax than I have now and able to afford the travel and things I want to do - within reason. That's something to look forward to. Half of my post retirement income will be index linked which also helps.

    But one thing that strikes me from reading this thread is how confidently wrong some people can be on how pensions work.



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