State Pension Age Speculated To Rise To 75-81

[Frugal Git]

My version of retirement differs from most. I enjoy manual labour eg decorating/tiling/plastering and intend to 'retire' at 50 from a finance role I have been in since I was 18. However I will continue work for the physical and mental challenge rather than a need for money. .

I completely agree with your version of retirement. Getting out of the office and doing some form of more hands on/meaningful work is the new aim. Whether that's casual labour doing motorbike services, building sheds or setting up home automation systems, fixing computers, financial advising, accounting or tax law or photography and film making it matters not. Jack of all trades sounds good. If I can earn 10k a year doing a combination of the above charging a proper hourly rate for my time - great. That way I have no reason at all to do anything other than leave the pile invested and tinker anyway.

[wish I could afford one]

I won't stray from the thread but FIRE was always my aim. My version of retirement differs from most. I enjoy manual labour eg decorating/tiling/plastering and intend to 'retire' at 50 from a finance role I have been in since I was 18. However I will continue work for the physical and mental challenge rather than a need for money. Most of my friends are in building trades but they have done it all their lives and that's a very different path and physically hard work over a lifetime.

My job pays quite well and the pension at 62 is 4 times what I get a 50......but enough is enough. I nearly left at 40 but discovered and fell into the trap that 20/30's earned money is for food, heating and kids but in my 40's it was for wealth creation and my salary increased substantially too. But 50 is enough for me....the stress, difficulty booking a nice holiday, worry about work when not at work takes it toll.

I am looking forward to working in tranches eg 3 months on, then 9 months off.

Will read your blog. Thx.

Thanks for sharing and nought wrong with any of that. For me FIRE has always been about work becoming optional. That enables margarita's on the beach if I so choose but it also allows voluntary work, side hustles or lower paid more enjoyable work. For me I expect I'll probably decompress for 6-12 months but then if I was placing my bets I'd say I'll be doing one of the last three options after that. First step thoiugh will be to settle in my new country, decompress and rebuild my physical fitness to the peak it once was.

[wish I could afford one]

I completely agree with your version of retirement. Getting out of the office and doing some form of more hands on/meaningful work is the new aim. Whether that's casual labour doing motorbike services, building sheds or setting up home automation systems, fixing computers, financial advising, accounting or tax law or photography and film making it matters not. Jack of all trades sounds good. If I can earn 10k a year doing a combination of the above charging a proper hourly rate for my time - great. That way I have no reason at all to do anything other than leave the pile invested and tinker anyway.

100% agree also.

[Frugal Git]

Good post FG and I know we've had some good discussion in the past but just wanted to comment on two of your points.

I'm trying to be a little more extreme than your withdrawing annual growth by trying to live off the dividends and interest. This is because for me at least I think I would find it difficult to sell down assets during a severe bear market. My divi yield (after netting off current house purchase wealth) is 3.8% today and I'm looking to draw down at 2.5%. This hopefully means by saving some of the divi's in the good times and by having 3 years of cash for the bad times I should be well on my way.

I came to HPC at about the same time I enacted my Plan B. At the time my focus was just trying to afford a home for my family which was Plan A. As the years went on Plan A disappeared but Plan B now actually looks far more interesting and enjoyable from where I sit today.

I think living off the dividends is a much more sensible strategy then mine! Divi yields only form a small part of my choice of where to invest. If i get some, great.

My way at the moment is simple and crude.

* Wait for the market to have a panic. It seems you never have to wait that long.

* Buy the major stocks (generally ftse 100 but the larger end of ftse 250 is usually where it's really beneficial if you have the cojones) from the sector that has been worst hit (providing they now look historically cheap).

* wait for the inevitable 50% correction (which usually comes within months rather than years) back up, and sell my stake.

* keep the profit as 'free' shares and see what happens. If they pay a divi - bonus.

This can be a very risky strategy and not one to recommend unless you have a strong stomach. But so far this has worked well. I am thinking of making one change to it. There have been a few times I've bought something and it's gone down a lot and is yet to recover. I'm now thinking that if something goes down 20%, I'll accept I got my timing wrong and sell half of it. This reduces my max loss on any individual position to 60%. A huge loss but it's historically counterbalanced by the ratio of times my good picks have worked (and indeed sometimes it is just timing - the 50% gain just comes after the initial paper loss because bottom picking is impossible) I've an 80% success rate on picking things that I've been able to sell - and so far, those 'free' shares have grown substantially too. On quite a few of them the position size now exceeds the original stake (i.e they went up another 300%).

This also has the benefit of providing diversification by natural rhythms. The stock market seems to always have hot and cold sectors, so what's not in favour each year tends to change.

Where it falls down is if I'm not bold enough, I end up accumulating a lot of cash and waiting for an op to park it. I think I should probably also start taking some and making more use of trackers or vanguard style funds, and selling portions of those if required when opportunities present themselves.

Sorry - long post and droning on. Basically stream of conciousness stuff for me to go off and think about how to implement as efficiently as possible.

Edited March 27, 2016 by Frugal Git

[wish I could afford one]

I think living off the dividends is a much more sensible strategy then mine! Divi yields only form a small part of my choice of where to invest. If i get some, great.

My way at the moment is simple and crude.

* Wait for the market to have a panic. It seems you never have to wait that long.

* Buy the major stocks (generally ftse 100 but the larger end of ftse 250 is usually where it's really beneficial if you have the cojones) from the sector that has been worst hit (providing they now look historically cheap).

* wait for the inevitable 50% correction (which usually comes within months rather than years) back up, and sell my stake.

* keep the profit as 'free' shares and see what happens. If they pay a divi - bonus.

This can be a very risky strategy and not one to recommend unless you have a strong stomach. But so far this has worked well. I am thinking of making one change to it. There have been a few times I've bought something and it's gone down a lot and is yet to recover. I'm now thinking that if something goes down 20%, I'll accept I got my timing wrong and sell half of it. This reduces my max loss on any individual position to 60%. A huge loss but it's historically counterbalanced by the ratio of times my good picks have worked. I've an 80% success rate on picking things that I've been able to sell - and so far, those 'free' shares have grown substantially too. On quite a few of them the position size now exceeds the original stake (i.e they went up another 300%).

This also has the benefit of providing diversification by natural rhythms. The stock market seems to always have hot and cold sectors, so what's not in favour each year tends to change.

Where it falls down is if I'm not bold enough, I end up accumulating a lot of cash and waiting for an op to park it. I think I should probably also start taking some and making more use of trackers or vanguard style funds, and selling portions of those if required when opportunities present themselves.

Sorry - long post and droning on. Basically stream of conciousness stuff for me to go off and think about how to implement as efficiently as possible.

Your cojones are an order of magnitude larger than mine. I'm simply a time in the market rather than timing the market with trackers type of person. About as wild as I get is buy, hold and rebalance during the good times or bad.

I built a HYP, which today yields 6% or so, to help with the living off divi's strategy and I'm even having second thoughts about that from an under performance perspective but will stay with it as I need it to make the plan work (at least in the beginning, a good sequence of returns will see me with more wealth than I know what to do with so HYP will hopefully become less important).

I make good use of Vanguard (somebody starting today wouldn't go far wrong with buying a LifeStrategy fund and then going fishing IMHO). You mentioned the FTSE250. Vanguard have the ETF VMID which has an OCF of only 0.1%. Might be of interest...

[Frugal Git]

Your cojones are an order of magnitude larger than mine. I'm simply a time in the market rather than timing the market with trackers type of person. About as wild as I get is buy, hold and rebalance during the good times or bad.

I built a HYP, which today yields 6% or so, to help with the living off divi's strategy and I'm even having second thoughts about that from an under performance perspective but will stay with it as I need it to make the plan work (at least in the beginning, a good sequence of returns will see me with more wealth than I know what to do with so HYP will hopefully become less important).

I make good use of Vanguard (somebody starting today wouldn't go far wrong with buying a LifeStrategy fund and then going fishing IMHO). You mentioned the FTSE250. Vanguard have the ETF VMID which has an OCF of only 0.1%. Might be of interest...

Thanks you sir - I'll check out the funds. I'm now managing my parents assets too so I have to be a bit more strategic and measured then with my own! And my cojones are simply in accordance to my circumstances - I'm a single bloke who can afford to take what would by any measure be regarded as substantial risks. If you have responsibilities to others then your way is a much, much better choice - as you've so ably demonstrated on the blog. Here's hoping for a fair wind this year and FIRE for you by 2017!

[wish I could afford one]

Thanks you sir - I'll check out the funds. I'm now managing my parents assets too so I have to be a bit more strategic and measured then with my own! And my cojones are simply in accordance to my circumstances - I'm a single bloke who can afford to take what would by any measure be regarded as substantial risks. If you have responsibilities to others then your way is a much, much better choice - as you've so ably demonstrated on the blog. Here's hoping for a fair wind this year and FIRE for you by 2017!

Thanks for the wishes there FG. Wishing you much success going forward as well.

[stuckin2up2down]

You've done really well wish. Your obviously doing very well in your job. Will you be able to just give it up?

I gave up many years ago -to get the kind of pay increases you talk about on your site I'd have to work 12 hour days and most weekends. Not something I could do, would leave me miserable and probably with health issues. Then again I'm probably lazy.

Everyone can live below their means (still have an amazing lifestyle), and afford in a few years to buy a house outright somewhere. Then live off a small wage / savings. That's what i've got, not retirement but somewhat free while I'm still young, but it won't last forever. Funny thing is lots of my friends are coming round to understand how i've got it sorted, trouble is they've spent the last decade or two spunking their money on crap.

[Economic Exile]

So you retired at age 56 ?

I assume you realise how amazing that is ?

Not getting at you - i know you are a decent burd.

No.I wish!

I took an occupational pension early. About 6 years ago I had a rough spell and had the misfortune of having to attend the job centre for a spell. The pension is roughly JSA amount so if the worst comes to the worst I can get by without having to go back there.

As for retiral. No chance until drawing state pension at age 66 for me...currently. Or if 22 year old son leaves home.....but there is little chance of that.

Edited March 28, 2016 by Economic Exile

[jiltedjen]

my state pension age is 68

i will probably retire at 60 and use savings to take me to 68. coupled with claiming everything i can.

might even retire earlier than that so i can have a few able bodied years. my boomer parents with their easy boozy lives are falling to bits in their early 60's.

Add in my actually hard life of a millennial into the equation and all the extra stress i will probably drop dead in my 50's.

i will claim everything i can.

one neat trick for those wanting early retirement (who don't already have degrees) is to take the free money and grants to follow your interests for 2-3 years, that could help you reach your state pension age.

[wish I could afford one]

You've done really well wish. Your obviously doing very well in your job. Will you be able to just give it up?

I gave up many years ago -to get the kind of pay increases you talk about on your site I'd have to work 12 hour days and most weekends. Not something I could do, would leave me miserable and probably with health issues. Then again I'm probably lazy.

Everyone can live below their means (still have an amazing lifestyle), and afford in a few years to buy a house outright somewhere. Then live off a small wage / savings. That's what i've got, not retirement but somewhat free while I'm still young, but it won't last forever. Funny thing is lots of my friends are coming round to understand how i've got it sorted, trouble is they've spent the last decade or two spunking their money on crap.

That's been one of my choices. I'm not a walking genius and have peers around me who are. One thing I've done to out perform them is graft. I work hard with a regular day being greater than 12 hours.

Will I be able to give up the day job? Absolutely. I've been on my plan since 2007 and TBH I can now smell victory. I cannot wait to leave the poor quality housing and overcrowding that my job necessitates I put up with. I cannot wait to have my days as my own. Don't get me wrong I don't not like my job but I can certainly think of many things higher on the to do list.

Full disclosure: That said I do try and avoid working weekends as I really do need some down time and family time. Sometimes I have to but it's the exception, not the rule and I do fight having to do it.

[wish I could afford one]

my state pension age is 68

i will probably retire at 60 and use savings to take me to 68. coupled with claiming everything i can.

might even retire earlier than that so i can have a few able bodied years. my boomer parents with their easy boozy lives are falling to bits in their early 60's.

Add in my actually hard life of a millennial into the equation and all the extra stress i will probably drop dead in my 50's.

i will claim everything i can.

one neat trick for those wanting early retirement (who don't already have degrees) is to take the free money and grants to follow your interests for 2-3 years, that could help you reach your state pension age.

Is it really? How do you know that age won't be moved again and again? How do you know it won't eventually be means tested where if you have anything saved you have to use that up in an orderly fashion first? Not meaning to be an ar*e but history shows continuous pension tinkering and I see nothing that is going to make that stop. You do know they've started yet another consultation on the State Pension including age?

My plans are based around a State Pension of exactly £0. Anything more than that and I'm quid's in.

[stuckin2up2down]

That's been one of my choices. I'm not a walking genius and have peers around me who are. One thing I've done to out perform them is graft. I work hard with a regular day being greater than 12 hours.

Will I be able to give up the day job? Absolutely. I've been on my plan since 2007 and TBH I can now smell victory. I cannot wait to leave the poor quality housing and overcrowding that my job necessitates I put up with. I cannot wait to have my days as my own. Don't get me wrong I don't not like my job but I can certainly think of many things higher on the to do list.

Full disclosure: That said I do try and avoid working weekends as I really do need some down time and family time. Sometimes I have to but it's the exception, not the rule and I do fight having to do it.

Well that's fair enough, you genuinely sound like a hard worker and deserve your retirement. In my industry the people working late long days I often out performed them working normal hours. I regularly got overlooked for promotion as I spent less time at my desk.

The way to get ahead was to pretend to work long hours, take credit for others work, shout about the small amount of work you do and be chummy with management.

Good management would know who is doing the work, bad wouldn't. I got bored of it.

[council dweller]

Yes, means testing of state pensions is coming.

This was obvious years back.

I wish I could` is right although a few of us are trying the state pension road.

[wish I could afford one]

Well that's fair enough, you genuinely sound like a hard worker and deserve your retirement. In my industry the people working late long days I often out performed them working normal hours. I regularly got overlooked for promotion as I spent less time at my desk.

The way to get ahead was to pretend to work long hours, take credit for others work, shout about the small amount of work you do and be chummy with management.

Good management would know who is doing the work, bad wouldn't. I got bored of it.

I agree with all of that. I have absolutely no time for face time people. They're wasting their own time and any decent manager would see right through it.

Of a morning I hit the ground running and just do not stop all day. I would estimate that my output is 2-3 times that of my peers. I am lucky though as my company is set up to be a delivery based company and really does pay based on delivery. I would also estimate that my salary is 2-3 times that of my peers and if you walked into my company you would not for a second spot me as a high earner. It's not all rosy for all though as that delivery based culture does not sit well with all people, particularly those who don't want to work for a living.

[ccc]

No.I wish!

I took an occupational pension early. About 6 years ago I had a rough spell and had the misfortune of having to attend the job centre for a spell. The pension is roughly JSA amount so if the worst comes to the worst I can get by without having to go back there.

As for retiral. No chance until drawing state pension at age 66 for me...currently. Or if 22 year old son leaves home.....but there is little chance of that.

Give him the boot !!

[council dweller]

No ....

Some people need time. It`s good to have somewhere to return to in between sowing wild oats of various kinds. It took me til I was 29 !

[Frugal Git]

I agree with all of that. I have absolutely no time for face time people. They're wasting their own time and any decent manager would see right through it.

Of a morning I hit the ground running and just do not stop all day. I would estimate that my output is 2-3 times that of my peers. I am lucky though as my company is set up to be a delivery based company and really does pay based on delivery. I would also estimate that my salary is 2-3 times that of my peers and if you walked into my company you would not for a second spot me as a high earner. It's not all rosy for all though as that delivery based culture does not sit well with all people, particularly those who don't want to work for a living.

All companies should be like that. Genuine meritocracy. If hard work was genuinely incentivised, that would be tremendous. That it isn't in most places is why I've ended up looking to 'maximise my effective hourly rate' by being as efficient as possible without any additional effort. I'd love to work harder and contribute more but there is no reward anymore for doing so. And I wouldn't have any problem with someone earning 2000x what I did if they were 2000x more productive - but as you say, not everyone likes a fair system.

[winkie]

Working full time to working zero time, is most certainly wrong, a waste of valuable experience, knowledge and resourcefulness....ideally people should retire gradually over time, reducing their hours in their main job from say 55 to 60, using that time to train others with the knowledge they have gained and learned over many years, at the same time in their new found extra spare time learning new skills to take them forward, a complete change of direction......learning new skills, talents with creativity that has been dormant due to time spent doing other paid work, career type work......win.win.

[stuckin2up2down]

I agree with all of that. I have absolutely no time for face time people. They're wasting their own time and any decent manager would see right through it.

Of a morning I hit the ground running and just do not stop all day. I would estimate that my output is 2-3 times that of my peers. I am lucky though as my company is set up to be a delivery based company and really does pay based on delivery. I would also estimate that my salary is 2-3 times that of my peers and if you walked into my company you would not for a second spot me as a high earner. It's not all rosy for all though as that delivery based culture does not sit well with all people, particularly those who don't want to work for a living.

Sounds like a good job to work in. I progressively got lazier the more my work went unnoticed.

Coupled with the fact I hated the huge amount of tax I went did go to a system I didn't support. In the end I decided it wasn't worth the hassle. Now working for myself and doubt I'll ever earn over 10k a year unless house prices go down.

[wherebee]

I agree with all of that. I have absolutely no time for face time people. They're wasting their own time and any decent manager would see right through it.

Of a morning I hit the ground running and just do not stop all day. I would estimate that my output is 2-3 times that of my peers. I am lucky though as my company is set up to be a delivery based company and really does pay based on delivery. I would also estimate that my salary is 2-3 times that of my peers and if you walked into my company you would not for a second spot me as a high earner. It's not all rosy for all though as that delivery based culture does not sit well with all people, particularly those who don't want to work for a living.

what do you mean by face time people? people who go on facebook all day? or people who like meetings?

[council dweller]

Aren`t `face time people` otherwise known as women ?

[wish I could afford one]

what do you mean by face time people? people who go on facebook all day? or people who like meetings?

People who think it's about time in the company rather than maximising delivery for the least amount of time.

[wherebee]

People who think it's about time in the company rather than maximising delivery for the least amount of time.

ah - gotcha. with you on that one.

I always tell me team I don't care if they work 12 hour days or 8 hours days. The only thing that impresses me is quality of output.

[CunningPlan]

My father used to tell me about a warehouseman that worked at a firm where he was senior management. Always seemed to be doing nothing, just sitting around drinking tea or reading the paper . They were looking for cost savings so he was the natural choice to go. However, my father looked a bit deeper and found that the bloke's job was always done properly so decide to investigate further.

He went to see the chap and asked him why he was never really busy. The reply was that he took a look at every product that came into his stores. If he felt it would be a good seller he kept it by the door. If he thought it was total tat it went right down the far end. He rarely had to move more than 20 feet from his chair to pick each days orders.

Outcome was that they utilised the guy's spare time by giving him a seat on the product selection panel.

Work smarter, not harder.