Getting ready for retirement what changes should I make

H

holidayqueen

Registered User
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Age: 58
Spouse’s/Partner's age: 64 /65 in June

Annual gross income from employment or profession: 35;000
Annual gross income of spouse: 25;000

Monthly take-home pay 4;000

Type of employment: e.g. Civil Servant, self-employed employment in education sector

In general are you:
(a) spending more than you earn, or
(b) saving?
Saving 1,500 pm
Rough estimate of value of home 340;000
Amount outstanding on your mortgage: none
What interest rate are you paying?

Other borrowings – car loans/personal loans etc. No borrowings

Do you pay off your full credit card balance each month? Pay in full
If not, what is the balance on your credit card?

Savings and investments: 100k sitting in AIB and EBS making nothing 20k in prize bonds. State savings 105k
I have shares value 30k

Do you have a pension scheme? I will qualify for contributory state pension I am also paying 650 monthly in to an Irish life policy complete solutions current value 74;300
Spouse pensions He has a personal retirement bond value 38,700 in Irish life empower cash fund from a previous employment.
His current employment is public sector and is working part time pension lump sum is value 33k with annual payment 5k

Do you own any investment or other property?
Yes 1 house rural value 125k rented 700pm no mortgage
1 rural commercial with a flat over head 1150pm no mortgage

Ages of children: Adults

Life insurance: none


What specific question do you have or what issues are of concern to you?
Hi I am looking for advice on how we are set up for retirement. My husband can retire in June but thinks he will continue until he is 66 until he receive state pension. I want to retire as soon as I can but will go to 60 I think which is end of 2022. We live a modest enough lifestyle and have no borrowings our big outlay would be our health insurance and golf membership and some travel. Then just our usual outlay. We are fairly fit and healthy and our hobbies apart from golf are cost free walking cycling. Our food bills are modest as we do all our own cooking no takeaways.
We feel we would have plenty to live on in 36k annually.
If my husband gets the state pension in June 2022 can he claim for me as a dependant if I had finished work ?
I know it’s means tested but if I had no income would I be eligible
My plan is that if he was getting state pension plus 5k from his work pension and we have 21k of rental income I should be able to retire at that stage.
I would also be able to draw down 25% of my pension at 60 which would be 20k so I could use that for the time between 60 and when I get my state pension which my be 67 or 68.
I know that our cash is making nothing but we are fairly cautious how could we be doing better ?
Any other thoughts on things we should be thinking about .
Thanks in advance
 
You are well off, with a commercial invest property, residential investment property, 105k state savings, 100k in bank, prize bonds 25k, shares 30k, pension etc, no mortgages etc. Well done. My advice is to enjoy life and maybe consider retiring earlier rather than later. Quote " My husband can retire in June but thinks he will continue until he is 66 until he receive state pension. I want to retire as soon as I can but will go to 60 I think which is end of 2022. "

You are both you say blessed with reasonably good health. Long may it continue and I wish you the best. My advice is enjoy life, spend time with family and friends - hopefully c-19 will fade away back so we can all have some normality later this year. When conditions allow, go on holidays. I know countless people who work hard until retirement and who then cannot enjoy retirement, for whatever reason eg health.
 
I would echo Timjoe's post but I would add that it is likely you will have no difficulty in retirement, but your family (grown up or whatever) have to come to terms with your retirement too. I would advise that you do not become a fulltime and overtime nil paid childminder.

I would also advise in your first winter/spring of retirement you rent a good quality apartment in Spain for about 6/8 weeks (Rental Cost inclusive of utilities and no extras €750.00 or less per month). You'll get much of this back with the cheaper cost of living and warmer sunshine there.

I should add you must work at your retirement and leave nothing get in the way of it.
 
Hi Queen

What you need to do immediately is to consult a fee based pensions advisor.

It is likely that you can make AVCs and get tax relief on them.

At your age, you will be getting the benefit from any such contributions in the short term.

Brendan
 
Hi @holidayqueen

I think you have a solid plan.

I would be somewhat nervous about the reliance on rental income (which obviously isn’t guaranteed) but I think you have sufficient cash reserves to bridge any voids or over-holding periods.

Rental income is taken into account as part of the means test for any qualified adult increase to a contributory State pension. Are your rental properties held jointly?

More importantly, will you have sufficient PRSI “stamps” to qualify for the full contributory State pension? If not, you should consider making voluntary contributions.
 
I'm a while away yet; but I will say this has its appeal. How do you manage re transport? Is longer term car hire viable?
 
Hi Thanks We are definitely thinking of spending sometime somewhere warm for January and February and have looked at rental prices in Gran Canaria or Tenerife which would be a bit more that 750. I must check out other areas like Spain also.
Only 1 grandchild not living in Ireland so I would say both of my children won’t need too much adjustment.
We have looked at lots of things to do in retirement so we will be working on it for sure and are having a bit of practice with this lockdown so far have not been bored
 
Hi yes the rental income especially the commercial aspect of it is not at all reliable but the overhead unit we have renovated to a good standard so we feel that this would always rentable so have kept in mind that the figure quoted could be reduced but not by too much.
Yes the properties are held jointly and with the savings I think I won’t be eligible for qualified adult increase .
I have a few years missing but I will get the homemaker allowance but must look into making voluntary contributions.
It seems to be difficult to find information on what I will get as changes are on the way and will surely happen in the next two years.
I think as suggested already I do need pension advice.
Thanks again
 
Before the first lockdown I went to a financial advisor and he had some advice for me and I did ask about his fee and he told me it was free and that it would come out of what ever product I chose. But I did not sign up for anything as I was unsure . How do you know who is an independent fee based pension advisor?
Thanks for taking time to reply
 
Thirsty said:
I'm a while away yet; but I will say this has its appeal. How do you manage re transport? Is longer term car hire viable?
Click to expand...

In our case the local bus service is good and cheap (€1.20 per journey) to nearby villages and towns and indeed within the 3 miles length of resort. But, sometimes we rent a car for 6/8/12 weeks locally. The local car rentals do not have span new cars usually, but they are not too old either. They are relatively cheap compared to what "airport" rentals charge and their insurance is cheaper also. In some cases they will leave their car in the airport for collection by you and you can return the car to the airport later for collection by them. If you are renting a property privately I would advise that you talk to the person renting the place to you where you will be advised if such car rentals are available.
 
holidayqueen said:
it was free and that it would come out of what ever product I chose
Click to expand...

He will only recommend products which pay a fee.

You should treat it like going to a doctor or an accountant. Pay a fee and get advice which is best for you and not best for them.

I googled ireland fee based financial advisors and came up with a few.

Steven Barrett who posts on this site is one:
https://www.bluewaterfp.ie/our-story/
Brendan
 
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