Retiring

blue for life said:
Well obviously you don’t know my circumstances and I don’t know yours plus we probably want different things. I don’t have a mortgage and have a lifetime guarantee living in a house owned by my sister paying minimal rent. I won’t need a car later in life where I live. I could live without one now in fact. And I am grown up enough to know what I want and the cost of living into my old age. Oh plus two pensions and the state pension. It’s not a ‘nice theory’.
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In that case, you should accept that you are in a very privileged and unusual position and stop lecturing people on their "spend, spend, spend" lifestyles.
 
Newman Noggs said:
In that case, you should accept that you are in a very privileged and unusual position and stop lecturing people on their "spend, spend, spend" lifestyles.
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I wasn’t lecturing at all. If they have got the money good luck to them. You were making presumptions!
 
willy eckerslike said:
Just wanted to come back to you on your reply, squirty, as I think I have worked out something following Gornik's post which means you might be slightly incorrect (or I may be misunderstanding your terminology).

In the article it mentions how the government calculated everyone's state pension values as at April 2016. I fit almost exactly with the example explained within it, and would have been 29x contributing years at that time, however in my case that seems to have been about 15x full years only, i.e. I was contracted out for the remaining 14. This means my 'starting figure' is around £154 (the basic state pension plus 14 yrs of additional contributions) and with the 5x qualifying years since (come April), will reach full pension - which gov.uk confirm. That's a total of about 20 full years only, nowhere near 35.
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That’s right.
But I also think that any years you have added since 2016 will be calculated as full years, which is also mentioned in the article.
At 2016 I had 8 years full and 33 years contracted out. At that time my pension was forecasted to be approximately £142. The forecast now shows it is nearer to £160 as I’ve done another four years or so since then.
I think they look at your whole NI contribution and then see how much of it was a full NI and how much was contracted out.
 
Am I correct in thinking the COPE figure is reduced from 2016?
When I looked online at my state pension forecast it showed I qualify for the full amount 175.20, but also there was a COPE figure of £24.
So as we're 5 years on at full contributions (2016-current) the COPE figure has been overridden
 
dickie davies said:
Am I correct in thinking the COPE figure is reduced from 2016?
When I looked online at my state pension forecast it showed I qualify for the full amount 175.20, but also there was a COPE figure of £24.
So as we're 5 years on at full contributions (2016-current) the COPE figure has been overridden
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The more I read up on it, the more I think the COPE figure confuses things. If I am correct (and it would be good to get someone to confirm) this figure was a 2016 calculation of the contracted out contributions you had made to that point in time and either:

a) what that would have been worth if it had been left in the (old additional) state pension.
b) what they estimate your contributions should be worth today in your private fund

I don't know if this figure changes over time (since 2016) to reflect estimated growth in the private fund or not, I'm going to keep checking to see if it does. In any case, those funds are all in your private pension now so it will depend how that performed. It can generally be ignored if you are going to get full state pension I would say.

Here's how I think mine is worked out (*using 20/21 rates)...

a) I know I had (in 2016) 29 out of 30 years for the old basic state pension, £134.25* so makes that £129.78.
b) I don't know the additional pension contributions.
c) This years forecast is £174.99 (21p short) but that includes 4 years at £5.01 (which is 1/35th of the current state pension) so subtracting those means my 2016 starting figure is £154.95, and therefore that means my additional state pension (b) equates to £154.95 - £129.78 = £25.19. My COPE amount is £36.42 which suggests I needed 7 years (@£5 pa) but it's almost overridden in my case in 4.
 
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I understand that currently you can have a tax free amount of 25% of your pension pot that can be taken as a lump sum upon retirement. After looking at some other info , notably this

Pension withdrawals: four tax-free ways to access your retirement savings | lovemoney.com

www.lovemoney.com www.lovemoney.com

you can also use the 25% over multiple withdrawals by moving a percentage of the overall pension from the accumulation to income (crystalising that bit of the pension) and then taking 25% of that tax free.

So for example if you had a pot of £500k you could take out £100k leaving the other £400k to grow in the pension. Of the £100k you could then take 25% tax free so £25k leaving the remaining 75% invested. You could do this multiple times until your whole £500k pot has been used up. Considering that the invested pension pot will continue to grow this seems like a fairly tax efficient way of drawing down on a pension pot and avoiding some tax.

Now the question I have is where does this leave you in relation to your lifetime allowance, say if your pension pot was approaching the lifetime limit, (BTW I realise that figure is just north of £1M). Does the lifetime limit only take into account the accumulation part of the pension or would it also include the crystalised (income) part as well ?
 
Kompany Car said:
I understand that currently you can have a tax free amount of 25% of your pension pot that can be taken as a lump sum upon retirement. After looking at some other info , notably this

Pension withdrawals: four tax-free ways to access your retirement savings | lovemoney.com

www.lovemoney.com www.lovemoney.com

you can also use the 25% over multiple withdrawals by moving a percentage of the overall pension from the accumulation to income (crystalising that bit of the pension) and then taking 25% of that tax free.

So for example if you had a pot of £500k you could take out £100k leaving the other £400k to grow in the pension. Of the £100k you could then take 25% tax free so £25k leaving the remaining 75% invested. You could do this multiple times until your whole £500k pot has been used up. Considering that the invested pension pot will continue to grow this seems like a fairly tax efficient way of drawing down on a pension pot and avoiding some tax.

Now the question I have is where does this leave you in relation to your lifetime allowance, say if your pension pot was approaching the lifetime limit, (BTW I realise that figure is just north of £1M). Does the lifetime limit only take into account the accumulation part of the pension or would it also include the crystalised (income) part as well ?
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Lifetime allowance is tested at every crystallisation event and includes everything. It is also tested at 75 too.

www.pensionsadvisoryservice.org.uk

Lifetime allowance for pension savings | MoneyHelper

The lifetime allowance is a limit on how much you can build up in pension benefits without paying tax. Find out the rules and how to protect your pension.
www.pensionsadvisoryservice.org.uk www.pensionsadvisoryservice.org.uk
 
Retiring (or not) is a very personal decision. I’m happily working even though I’m approaching 67 but obviously that isn’t for everyone.

Equally, retiring as soon as possible and the ‘not enough hours in the day’ viewpoint of others doesn’t appeal to me in the slightest.
 
I'm taking early retirement on my 50th birthday in May. Have been working since I was 17, bought my first house at 21 and paid off my mortgage when I was 32. Haven't had a car for 17 years, and I'm not at all materialistic (apart from spending money watching City home and away, holidays, beer and other essentials).
Looking forward to spending my time getting fit and staying fit, sorting out some longstanding issues with my house and garden and loads of travel and relaxation.
Haven't been enjoying my job for a while, especially after having worked in isolation at home for the last year, so really looking forward to being able to knock it on the head.
 
staffsblue said:
I'm taking early retirement on my 50th birthday in May. Have been working since I was 17, bought my first house at 21 and paid off my mortgage when I was 32. Haven't had a car for 17 years, and I'm not at all materialistic (apart from spending money watching City home and away, holidays, beer and other essentials).
Looking forward to spending my time getting fit and staying fit, sorting out some longstanding issues with my house and garden and loads of travel and relaxation.
Haven't been enjoying my job for a while, especially after having worked in isolation at home for the last year, so really looking forward to being able to knock it on the head.
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Well done mate - fair play to you
 
During this lockdown i've been pondering retiring even though i only do 25hrs a week.
Being away from work has made me 'nice' again according to the breadknife.

After spending ten years going to the pub after work and getting annoyed by the people in them then coming home in a bad mood i probably needed a kick up the arse to get out of that cycle and covid has done that.
 
stonerblue said:
During this lockdown i've been pondering retiring even though i only do 25hrs a week.
Being away from work has made me 'nice' again according to the breadknife.

After spending ten years going to the pub after work and getting annoyed by the people in them then coming home in a bad mood i probably needed a kick up the arse to get out of that cycle and covid has done that.
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I found less time spent on social media did this for me, deleted most apps and turn the news off after the headlines, also not watching sky sports news afetr a rag or dipper win helps
 
Blue Maverick said:
I found less time spent on social media did this for me, deleted most apps and turn the news off after the headlines, also not watching sky sports news afetr a rag or dipper win helps
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Ha, yeah. I only do this site and a bit of facebook for work and never have ssn on. In fact, the only time i used to see ssn was in the pub. Rarely watch the news either.
Living, working and boozing in the same town means i get mithered by all sorts of people all the time and it's probably worn me out.
 
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