Retirement...when, how old and how much??

My plan/hope is to stop working at 60, not retire as I’d like to give something back to society although not sure what yet (I’d like to go with Mrs MB and do something in somewhere like Ghana rather than UK initially) - my job has always been about making money for folk which is a bit soul destroying when I think about it too much. A few things need to fall in to place for it to happen but I’m hopeful it will all work out. Else I’ll be working until 65+ and I’ll probably miss the opportunity to do something for good.
 
SebastianBlue said:
I covered all of this in my post: “unless your investment realisation horizon is 20+ years and you are certain you will not have any cashflow issues in the impending global economic decline.”

But even your “good” scenario would not be sufficient for the economic downturn coming. People are underestimating the depth and breadth of market instability and dysfunction.

And “all the uncertainty and high inflation are factored into the current prices anyway” is not correct; that is a falsehood in the “everything is priced in” narrative being perpetuated by inexperienced retail traders that have become a more prominent force (both within markets and within broader culture) over the last few years.

Most have only invested/traded during a time of “stocks only go up”, instigated by the largest monetary and market intervention in human history, which is now being unwound due to functional, emergency requirements. It is a fundamental misunderstanding of market dynamics that has continually seen them “buy the dip”, as the the markets keeping dipping.

And the last thing someone that may have serious cashflow issues in the coming deep global recession would want in sustained high inflation conditions would be to have a double hit to their buying power by locking in their pound or dollar denominated savings in to equities that are losing value. If you held £50,000 in a low yield savings account, even with inflation, it would outperform an investment account continually losing value in addition to buying power. And that’s not factoring in the loss of value when a large number of people begin selling assets to cover cashflow deficits (see UK pension debacle currently taking place for an example of the spiral that ensues).

I say all of this as a person that has worked in financial data analytics for my entire career and has degrees in economics, statistics, and analytics and access to underlying credit and risk market data not available to most.

We have barely realised a bear market and calls for this being the “bottom” are pure desperation. There is a reason most seasoned, respected analysts are saying there is far more pain to come.

What is happening with GILTs, BoE intervention to prevent more asset dumping, and the volatility in global bond markets are merely early warnings of what is to come.

We are far from a “bottom” and anyone buying now needs to understand that and determine if losing 20-40% of the value of their investment from here, with a likely 5-7 year recovery to just nominal initial cap outlay (this is going to be a long recovery, nothing like 2020 for many reasons) makes sense for their financial situation given the impending global economic downturn.

My advice not to buy now is based on statistically significant data showing “most” people are not in a strong position to weather the storm that is coming and so should not be making decisions that would put them in an even worse position. Many aren’t even in a position to manage the current situation.

What people do now will have a significant impact on whether they are able to navigate what is to come. There should be an acute focus on protecting cashflow, as it matters little if you have a large investment account when you cannot meet you current financial obligations (which forces you in to an asset dump that begins a vicious wealth destruction cycle).
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I agree with you completely about average people who aren't in a good cash position, but if we strip that all back and presume that the imaginary person is in a good financial position with adequate savings, no immediate goals (within 5 years) and who has a fund hundred £'s to spare each month - I still find it incredibly hard to argue against investing into a SIPP right now.

You can guarantee a 20% ROI immediately (obviously more if you're a higher-rate taxpayer). There is no alternative to someone who has spare cash they want to invest that would offer as good a deal as that.

Anyone who's fairly uninformed on the matter shouldn't be trying to time the market. They should set and forget, reinvest dividends, etc. And I will die on this hill.... no matter how qualified someone is, or how much data they've analyzed, no one.... whether it's Warren Buffet or Joe Bloggs, knows what's going to happen. The market could double in the next year. It could half.

This link isn't for you (as you obviously know a lot more on this subject than most) but for other forum members, read this article about Bob, the world's worst market timer. It highlights quite well the fact that crashes are part of investing and if you're in it for the long haul you'd do very well to lose out.
 
Manchester33 said:
I agree with you completely about average people who aren't in a good cash position, but if we strip that all back and presume that the imaginary person is in a good financial position with adequate savings, no immediate goals (within 5 years) and who has a fund hundred £'s to spare each month - I still find it incredibly hard to argue against investing into a SIPP right now.

You can guarantee a 20% ROI immediately (obviously more if you're a higher-rate taxpayer). There is no alternative to someone who has spare cash they want to invest that would offer as good a deal as that.

Anyone who's fairly uninformed on the matter shouldn't be trying to time the market. They should set and forget, reinvest dividends, etc. And I will die on this hill.... no matter how qualified someone is, or how much data they've analyzed, no one.... whether it's Warren Buffet or Joe Bloggs, knows what's going to happen. The market could double in the next year. It could half.

This link isn't for you (as you obviously know a lot more on this subject than most) but for other forum members, read this article about Bob, the world's worst market timer. It highlights quite well the fact that crashes are part of investing and if you're in it for the long haul you'd do very well to lose out.
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Of course, as I said in my posts, if your horizon is 20+ years (and you know you will have absolutely no cash flow issues in an economic downturn) than it doesn’t really matter when you enter the market. I have and never will argue otherwise.

But that is not the case for the vast majority of people that would be considering entering the market right now. Hence my advice.

And today’s Japan, German, US CPI data is an indicator of what I have been trying to warn everyone about (since essentially February of 2020).

Current conditions are very different to recent downturns (even the GFC). Entrenched inflation compounds investment losses in a way not seen in nearly 50 years. And economic conditions are going to get worse, especially in the UK, which will put immense strain on most people’s cashflow.

That means entering and losing 20%, with it likely not even recovering to the level of initial capital outlay for five years or more, as you struggle to make ends meet, is a very risky play.
 
Gorton_Tubster said:
Iv semi retired. Earnt my shares and now working to keep fit and have framework around my
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Blue Maverick said:
Just retired at 53, paid off the mortgage (thank fuck) got a slush fund for emergencies and the rest I’m using at my leisure, guaranteed income forever and when I pop my clogs the wife is looked after forever. Retire as soon as you can and enjoy your life.
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You sound a bit smug there mate, oh I forgot you're a fireman ? Cushy job mate...
 
Came upon me quickly and as a bit of a shock last year - however thanks to a redundancy and pensions I have had nigh on a good lottery win tax free and am getting about 50% of my previous earnings every month. No mortgage as I paid that off and state pension if it and I survive another 5 and a half years ..... it's about what you want I think - I won't struggle with heating bills ( though like everyone I'd rather they were back where they were ) - I can put decent food on the table and I can afford to run a 9 year old car which suits my needs with ease. Depends what you want from life I suppose.

I do buy extra and put it in the food bank bin and the supermarket and I buy the Big Issue and also make a payment to a local pet charity - I do this because I want to but should that be my role in the 6th biggest economy in the world? When did Paul Dacre last buy a Big Issue? I suspect Johnson would take from the food bank bin in the supermarket not contribute .... I am a pensioner because of circumstances however the more I hear that these fuckers want me to go back to work to in effect save their sorry arses the more I am proud to be a pensioner as its become a type of industrial action against a Govt that just does not reflect my values.
 
Blue Maverick said:
Just retired at 53, paid off the mortgage (thank fuck) got a slush fund for emergencies and the rest I’m using at my leisure, guaranteed income forever and when I pop my clogs the wife is looked after forever. Retire as soon as you can and enjoy your life.
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How did you retire comfortably at 53, win the lotto, inheritance ?
 
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