Do we have enough to afford retirement?

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Pink sea thrift or armeria maritima

Which suggests around £25,000 – £30,000 a year is enough to retire on and be content and who are we to argue.  Other unspecified experts suggest 2/3rd of your working income is required for a happy retirement.  I have decided to share the details of our retirement income and savings on the blog to help others on a similar journey.  I know our circumstances are peculiar to us and what works for us won’t necessarily apply to you, whatever these online calculators and column writers suggest we are all individuals and what we feel we can live on and have managed to save will be different from anything you can and want to do.  But the information might inspire you or make you re-think your own ideas for financial independence and early retirement.

There are four reasons why early retirement for us has become possible.

Reason number one – downsizing
By 2008 our son was settled with his partner and we were able to sell our family home and down-size to a small flat that was cheap enough to buy mortgage-free [hurrah!] with enough left over to pay for the campervan [double-hurrah!].  The flat is also cheap to heat and run and so contributes to reason number two.

Reason number two – frugal living
Although I am grateful that a company is willing to pay me to give my time and do stuff I have the skills to do, my own income as a travel writer and administrator is below the average in the UK [currently £26,260/year gross].  Jointly we currently receive around £36,000 a year net from our different occupations.  I [honestly] cannot say that we are ‘ultra-frugal’; we have lots of holidays, eat out occasionally, go to gigs and plays, don’t always shop at the cheapest supermarkets and generally enjoy ourselves.  But the main thing is that we spend less than we earn.  Over the past six years [since returning from our ‘gap’ year] our average annual spending has been £24,125 a year [about 2/3rd of our income] and we have saved the rest.

Before we can retire our savings need to be sufficient to cover a period of nine years [see below].  After many modifications and adjustments we have come up with what we hope is a generous budget for retirement of £27,000 a year.  This is more than 2/3rds of our current working income but is near the half-way point of the Which figure above.  Because we have lived fairly frugally over the past six years and we are naturally cautious we wanted to have a bit of expansion room in our early retirement ‘income’.  We have estimated that this amount will be enough for monthly meals out, cultural stuff and [most importantly] travel in the campervan [we are not planning lots of long-haul flights].  It should also be enough to cope with most small household crises [for example buying a new washing machine] and for any larger problems we have a contingency fund of £15,000.

Reason number three – we have pensions
We have saved sufficient to cover our ‘income’ for the years from 2017 to early in 2026.  In this momentous year all of our various pensions [none of them very large] will provide us with an income of a similar amount.

A quick bit about our pensions.  We both have public sector pension that are final salary pensions and often described as ‘gold-plated’ in the media.  I have worked in the NHS for around thirteen years of my working life and for this will receive just over £2,000 a year [not even copper-plated really].  Mr BOTRA will have 30-years service in higher education and so will receive a more useful pension of around £12,000 a year.  In addition I have a couple of small private sector pensions from about eight years in the charity sector that might bring in a few hundred pounds a year but will be dependent on the annuity rates at the time.  I am ashamed to say that for many years I didn’t even save towards a pension but you live and learn.  According to the current forecasts our state pensions will make up the rest of our income.

Reason number four – the inheritance
Inheritance doesn’t sit comfortably with us but there is no doubt that when a close relative died we inherited enough money to bring our retirement forward by about five years.  Some of this inheritance came from selling a house but we also maximised the money by working hard to sell his 170+ paintings, 250+ ornaments and many other collectables.  There was a four-month period in 2014 when we spent our evenings and weekends learning about fine china and collectables, placing detailed adverts on Ebay, packing delicate ornaments and posting them to far-flung destinations.  We dealt with dealers and enthusiasts to make the most of what we had been given.  We are truly grateful for the opportunity this money has given us and as the money came from a relative who enjoyed a long retirement from his mid-50s and spent his money on lots of holidays I like to think he would approve of our choice of how to spend the money.

 

 

 

 

 

The best of the Lancashire coast

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A sunny autumn day on the wide expanse of the beach at Formby

We took a chance on a November trip in the campervan and were rewarded for our optimism with a sunny day.  We have such a lot of stunning coastline on this island that the Lancashire coast perhaps isn’t what springs to mind when you think of beautiful parts of our coast.  This part of the seaside certainly has more than its fair share of resorts and built up areas.  But Formby Point [not strictly speaking in Lancashire but we still recognise the pre-1974 county boundaries at BOTRA towers] is a jewel in the crown that makes up for everything the planners have done on some stretches of the Lancashire shore and we are lucky that it is less than an hour from our home.

After spending Saturday afternoon walking in the gloom through wild hail and sleet in Southport, the sun on Sunday was very welcome.  In Southport we walked along the wooden planks of the pier until it closed and joined the crowds watching the carnival that is the Christmas lights switch-on in the town.

The sand dunes, pine forests and wide sweep of a beach at Formby are owned and managed by the National Trust.  This area is managed for the wildlife, not just the lovely red squirrels that entertain the visitors here, there are also newts, lizards and the rare Natterjack Toad.  It wasn’t the time of year for reptiles but the red squirrels were plentiful in the pine woods.  We walked around the asparagus fields and wound our way through the dunes.  We returned along the expansive beach, with views north to Blackpool and south to the Welsh mountains.  The beach is so immense that even on a sunny day there is space enough for everyone.

 

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Looking towards the north Wales coast from Formby

The good & bad of leaving presents

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Do people still receive clocks as a leaving present?

How little your work colleagues really know you and the resulting unsuitable leaving present is a long-standing joke within a group of our friends.  One friend once received the most inappropriate leaving gift that left her forever puzzling about how her colleagues had perceived her.  She is a hard-working, intelligent and stylish woman and yet leaving a project her colleagues presented her with a large soft toy rabbit, holding a large stuffed carrot.  I can’t be sure if I am, after so many years, embellishing this story more than it needs but the rabbit might have played a tune if you squeezed its tummy.  Of course, her friends [who perhaps know her a little better] found this gift very amusing but she moved on wondering what she had done to even suggest that this rabbit might be something she would enjoy receiving.

With over 25  different jobs you can imagine I have received numerous leaving presents over the years and looking down the list these gifts come to mind and make me smile, although none have been as unsuitable as the rabbit.

High on my list of leaving presents that stand out are the surprise gifts from a role I put up with for just three months before moving on.  I was very unhappy with the job and never felt I settled in but when I left they showered me with so many different gifts including a plant, writing paper, chocolates and wine, as I staggered home with all these generous presents I wondered if I was making a mistake by leaving.

At another job, despite my colleagues watching me hang up my cycling gear every morning, they decided to buy me a large and extravagant bouquet of flowers.  I puzzled for a while about how to fit the flowers in my pannier but failing and unable to bear just sneaking them in the bin [or walking home] I displayed them on reception and left them behind.

Other teams have got it right.  I still have beautiful jewellery and other tasteful and cherished items from teams and individuals I have worked with.  I still  treasure a soft and cosy throw I received from one workplace, an Italian shawl from another and a beautiful scarf from yet another.  These gifts will always remind me of the wonderful people who clubbed together and went shopping to find something they thought I would like and thinking about these lovely people taking such trouble over a gift for me always brings me close to tears.

All these leaving gifts mark the moment of moving on.  Particularly in community work my relationships with colleagues have often been intense, we will have worked closely as a team, I will have relied on these colleagues in tough situations, laughed with them and toiled with them. I am pleased that these moments get marked in even a small way.

The things that really start the tears flowing when I leave are the cards with all the lovely comments from my co-workers; as I read them I will start to wonder if I am doing the right thing leaving these fantastic people and stepping into the unknown.  One manager who knew me better than many wrote a leaving speech that was a real tear-jerker, describing me as, ‘a true mother-earth hippy with a hint of rock-chick’, giving me something to live up to!

As an administrator I now work in a support role within a team and as a home-worker the relationships have been less profound.  Tomorrow is my last team meeting with my colleagues and so as I draft this post the comforting smell of homemade ginger cake is seeping around the flat.  My gift to my colleagues is cake and I hope this will in a small way say thank you to them for their support and inspiration.

I am lucky to be able to choose when I finish work

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MRS ONL did a thought provoking post recently that highlighted how many people don’t get to retire when they would choose to.  The post was very timely as the small charity I work in has been going through difficult financial times.  I have told you about these problems before but things have become considerably worse since I gave notice of my impending retirement [these things are not related]!  Every week communications are sent out about someone else who is being made redundant; people who are skilled and dedicated workers who have given so much to the charity and each one of them brings me pain; to say that I feel I am leaving a sinking ship is to understate how fragile this organisation feels at the moment.

Mr BOTRA commented that if I could have hung on a month or more I might have been made redundant too and he is right, I am sure they will move on to the lower grade post when they have finished getting rid of the management tier.  And yet I feel pleased that I got in first, not only to save the charity I work for having to find the few weeks salary they would be obliged to pay me as redundancy pay but also for my own dignity; everyone knows that I am leaving to retire and it is my choice; I haven’t had the stress of ‘consultation’ interviews and competing for the one remaining post.  Other colleagues have not been so fortunate, are not leaving out of their own volition and will be going straight in to job seeking, a particularly tough activity during the festive period.

I don’t want to criticise the work of the charity, the services it delivers are extremely high quality but unfortunately the higher management took the somewhat reckless decision to grow and spend beyond the secured income a few years ago and individuals are now paying the price for that over-stretching.  The new management is taking control of the situation but many good people are being thrown out in the process.

This all really brings home how important having some back-up savings are for those times when employment let’s you down.  I feel privileged to be choosing when I can retire and I am very sad that I have colleagues with an insecure future.  I don’t intend to sound self-pitying, as I realise how fortunate I am, but leaving a despondent and bruised organisation means that certainly none of them will have any interest in joining my retirement party and there will be no one left to care enough about buying me a retirement present.  I will be able to slip away quietly and I think that is most appropriate in the circumstances.

 

 

 

I can’t wait to start spending those savings

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You might expect that as someone who has been saving for some years, firstly for a gap year and more recently for early retirement I am approaching the period when I have to start spending all that money with some trepidation and reluctance.  Instead I find that I am eager to start spending those savings.  I think this is for two reasons; firstly I think that money is only there to spend and I am somewhat uncomfortable earning more money than I need and so having spare money to save; I will be happy when we have just enough. Secondly, of course, the spending period of this early retirement project is the whole point; for me saving isn’t what defines me and money is only saved to be spent in the future.

Looking back I have only ever successfully saved for something when I have a clear goal in mind.  Since the early years of our marriage when the washing machine broke and we didn’t have enough money to buy a new one, we have always aimed to have at least £300 [for that washing machine] in a savings account.  We have prioritised saving for holidays [even when we had very little] for many years, we saved to buy our first campervan and we saved energetically to have our gap year in 2009.  Since returning from this gap year we have worked hard to put money aside to retire.  But apart from these periods of active saving I have generally been a spender and I am looking forward to returning to being that person.

This isn’t to say I want to throw money away or spend money on unnecessary stuff, I have never really been one of the world’s best consumers.  Although I certainly can’t reach the minimalist goal of owning just 33 items of clothing I don’t like owning surplus stuff and I am happier finding second-hand bargains than buying new.

I don’t feel that saving [or spending] money should define me.  I am keen for us to become a none-paid-work couple who have just enough money for our needs and no more [with a little in a contingency fund for that washing machine] and we can work our way through the savings, watching them dwindling as each year passes.  To me, this situation has a harmony; we will be financially secure but not rolling in it and we will be time-rich.  I think it is possible I might get a bit of a thrill if we are super-frugal and finish a year a few hundred pounds below our annual budget … but then if we do manage to do that I will want to celebrate by spending it on throwing a party!

 

 

I hope my retired self doesn’t forget the workers

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A dripping Scottish spiders web

One of my concerns about being retired is becoming one of those people [and I have met a few] who tell you about the one thing they have done in a day and then make out they are leading really busy lives.  They will tell you this in all seriousness and genuinely seem to have forgotten what life is like for the working population.  These retirees are oblivious to how the workers have to fit in dentist appointments, buying stuff on Ebay and getting the car fixed and all around the nine-to-five job.  And that these wage slaves still have to find time to get home and clean the bathroom … and yet all these retirees were these people once.  I hope that when I am retired I remember what it was like to feel that the days are running away with you and there is so much to cram in and I also hope I will be the retired person who offers to help out our working friends with tasks to make their life less stressful.

This isn’t that I won’t sometimes revel in the opportunity retirement will offer to just do not very much in a day, to not feel the need to fill my time and to be a one-task-a-day type of person.  This is one of the many benefits of retirement and I can’t wait to relax in to this state of being time-rich.  I will be able to sweep up the leaves and chat to the neighbours and then spend the rest of the day taking a walk, watching the wren out of the window, practicing some tai chi or curling up in an armchair reading.  What I want to avoid doing is telling anyone who will listen about how busy I have been to my working friends, and I hope I never say, ‘I don’t know how I had time to go to work’ just because I had to go for a blood test or I took the time to water the neighbours plants.  I hope I remember how lucky I am to be retired and I hope I do not feel the need to justify my existence by pretending I have a lot on my plate.

I will try hard not to become so relaxed that I forget the stresses of pre-retirement days but I hope that all my friends [real and virtual] will please tell me if I become that person!

A budget-friendly autumn trip to Scotland

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Looking across the beautiful Loch Linnhe

Scotland is the most motorhome friendly part of the UK and this, and the beautiful scenery, is why you meet so many other motorhomers when you visit this wonderful country.  In Scotland it is rare to find a height barrier [although Kinlochleven should be ashamed of the one of the B863] and there are plenty of small car parks and large lay-bys to pull up for a brew-with-a-view or an overnight stop.  We are considerate motorhomers who just enjoy the freedom of the road and although everywhere was pretty tidy, we always leave no mark on these freely provided facilities and pick up and take away any litter.

On this trip we found a great overnight stop on the Glen Lochy road, we stayed on the car park of the eclectic and warren-like Highland Arts Exhibition in Ellenabeich on the Isle of Seil for £10, just a short stroll from the cosy Oyster Bar, enjoyed a night of luxury at the Caravan Club Bunree site[£19.90], with spectacular views over Loch Linnhe and then joined half a dozen other ‘vans in Glencoe on the Signal Rock car park for a final free night.

Scotland was in its full autumnal glory, the trees magnificent in stunning ranges of colours.  We took a walk from the car park in Glen Orchy to see some of the fine native Scots Pine trees  in the hidden hillside remant of the Caledonian forest at Allt Broighleachan.  We also walked from Port Appin to find the cliffs and sea arch, now stranded high and dry since sea levels have fallen.  We found a real gem at Glencoe Lochan with great footpaths and lovely views to the distinctive Pap of Glencoe and reflections in the lochan.  We followed the West Highland Way and the massive pipeline through which water roared down to the hydroelectric plant in Kinlochleven and relaxed watching the climbers on the climbing wall in the village.  We picked up the West Highland Way again on one of our favourite parts of this long distance walk on the cobbled old road from Victoria Bridge.

We spotted a golden eagle soaring over Loch Feochan and a red deer peering out of the golden grass from the path to Loch Dochard and lots of distinctive pochard diving and bobbing on the sea lochs.

We filled up with lpg / autogas while we were away.  We have a refillable cylinder and this fuels our cooking and heating when we are off-grid.  Even in cold winter weather this only costs us a few pounds a night to keep the ‘van warm, run the fridge and provide us with the numerous mugs of tea and coffee we survive on and a freshly cooked evening meal.