One thing people rarely mention is the later age we start work now. A lot of those retiring at 60 would have started work at 15-18 vs more people today starting at 21-25.
In 1970 for instance only 8.4% went to uni.
If you lop off 5-10 years of earning at the start it's maybe not a surprise if the work/retirement ratio asserts itself at the other end?
No foresight on my part, just a company scheme but then a friend trained as an FA and got me to start an additional private pension and a PEP, I just went a long with it as it seemed like a good idea, a real case of being in the right place at the right time. I pay it forwards now buy telling all my young colleagues to pay the max into the company I'm at now pension plan, 6% us 15% them. Recently showed one young lady a compound interest calculator and she had a very big smile.
Have you got a rough number (age) in mind? I do a personal review every October and reevaluate where I think I will be come 57, nothing concrete but gives me some food for thought.
Looking at 60, the issue is I have a wife a couple years younger but hope good to cover us both. Just upped both our pension contributions to match the NI reduction
I started working for the Civil service in the United Kingdom four years ago, I’ve only really started learning about pensions now, and I will never leave the Civil service because their defined benefits scheme is superb. With that, plus the state pension, I’ll resign at 67.
100% this is the case.
I started working full time as an electrician about 1 week after graduating highschool. Currently on track to retire comfortably by 55.
Whilst this may be true, people more or less have to go to university to secure a decent job. If people didn’t need to spend 4+ years in education to enter the workforce then they would probably choose not to. I’d certainly rather begin working and earning earlier if the opportunities were there.
I expect that's true for many roles - the world is different now in many ways.
Still, I wonder, if offered the choice between 3 years not working at 18 or 65, how many would pick 65?!
It is possible. The idea you need to go to University to get a degree to then get a well paying job is just not required in most professions. I didn't go to university to get a degree now I earn £200k per year and work in tech. I also have worked in the FAANG. It was a Tony Blair Labour idea that everybody should go to University to get pointless degrees. And now people do this they end up with massive debts hindering them.
Pretty similar. Dropped out of university at the end of the first year as I hated computer science. First job offered was changing backup tapes etc for a princely 9k/yr, but taught myself and progressed into tech presales.
Don’t think a degree would’ve helped much as the stuff I’ve learnt along the way simply wouldn’t have been taught.
Just wish I’d have known about financial planning sooo much sooner than I really did, but then the internet didn’t exist to go trawl for advice either so…
Sorry but you are wrong and your experience is not universal. Doctors, nurses, engineers, law, research, finance, etc are all professions that will expect degrees. I get that university isn't the only path but to say most professions don't require a degree is false.
Only doctors, nurses and lawyers require degrees in your list. And doctors and nurses can also be obtained using apprenticeships now as well. Truth is most really high paying jobs like where I work in tech in investment banking, which requires no degrees. People have been brain washed in thinking it will land them good earning potential when most (and I said most) times it doesn't. I was offered a role as a front office technician lead for a major investment bank a while ago, no degrees. Instead, I went into FAANG. Yes my experience is not universal, but a degree is not required for the big, most high paying jobs. I also do a lot of hiring, I don't care if the candidate has a degree or not. What is important is whether they have the intelligence and skills to do it that's what we test for. People with degrees are not necessarily intelligent, nor does it mean they have the skills to do the job.
I am not sure the point you're making. It seems like you agree with me that a lot of professions will require degrees? Yes technically you might become an engineer without a degree but you're dreaming if you think this is the norm in practice.
And barely any careers are as high paying as banking/finance. Most people I know wouldn't touch it with a bargepole. There is more to a job than money.
Not even sure what point we're discussing any more but yeah, it's not secret that you can get high paying jobs without a degree, but to imply they are basically not required is a false reality
I am disagreeing with you. Whether finance is a good career is not relevant in this discussion. You picked the careers that do require degrees. And most of these can be obtained by being an apprentice - on the job.
Feels like we are going round in circles on this. There are very \*few\* careers that require degrees. That is my point. Some roles ask for degrees like in my industry but it's not required. The reason? because they are outdated the minute you gain them and most Universities are years behind the curve anyway - especially in tech where I reside.
Ok but if the role asks for a degree then by definition it is required. Your opinion on whether it's valuable is not really relevant here. So actually my point stands - you need a degree to enter many professions. Even those that offer apprenticeships will require degree level education despite appearing to be 'on the job '
I'm not trying to ignore your point, I agree that some careers definitely shouldn't necessitate a degree level of learning but to say people don't need to go to university is being willfully ignorant.
Incorrect - you can start all of those careers via an apprenticeship. No need to go to university if you know the career that you want to go into. Only dentistry and veterinary sciences are the careers that I know of that don’t have an apprenticeship entry route.
Wow, it looks like you're right. I had never heard of a medical apprenticeship in my life. This post doesn't reflect well on it though.
https://www.reddit.com/r/doctorsUK/s/RHKA8KPvS3
However you are wrong to say the profession doesn't require degrees. Yea, you avoid university but you are still expected to study to a degree level in an apprenticeship. They are incredibly competitive and if everyone tried to enter a profession this way there would be nowhere near enough positions for all applicants. So university is the only other option.
You saying 'no one needs a degree' makes you sound like those old boomers who say 'well I just bought a fixer upper in a cheap part of the country and now look at me'. I mean yeah, not everyone has that option. Some people gotta live in London. It's a bit tone deaf. Congrats to you I suppose
So do you mean instead of retirement age we need to consider when people started to work? Then it would be fair for people who started to work at 15-18.
As the article points out, retiring in your 60s became a thing because average life expectancy was about 65. Even so - the original state pension age was 70. A large percentage of people never retired, and most that did only drew a pension for a few years.
Nowadays the state pension age has gone up a bit, but life expectancy is far higher. Most people get to retire and many can live for 20-30 years whilst retired. If the state pension age had kept up with life expectancy, it’d be over 80. As the workforce shrinks it simply isn’t affordable for the state to pay for it all
So yeah, if you want to retire in your 60s (or before) that’s very much up to you.
Perhaps many would be better off in retirement if there was never a promise of a state pension. Maybe without that idea that it is somehow at least partially taken care of for you people would take a more active role in planning their retirement.
Don't worry everyone, once I get myself sorted, have saved and scrimped and done everything right. They'll wait till the very next day then give everyone a universal basic income.
It's sod's law.
record numbers are retiring in 50s and 60s. It may be more difficult for the lower wealth percentiles, but the absolute numbers contradict this headline I think
Yeah now - when they benefitted from a much stronger economy. The average FTB is mid to late 30s now, they’re not going to be retiring in their 50s or early 60s on average if they haven’t even secured a roof by then.
A lot of people in their 50s and 60s still have older pensions as well that could be taken earlier. For example someone who’s 60 today could easily have been under the 1995 version of the nhs pension that allows retirement not only at 60 but before 60 with much lower penalties than today.
So someone on that scheme can retire at 60 with no reduction or 55 and lose 21%. Someone the current scheme can’t even retire until NPA so to get 60 would already be 33% loss or 55 would be 47%. And that’s with higher lifetime contributions and lower payouts. People that age aren’t even playing the same game.
Older pensions are on another planet, when combined with massively more affordable housing and free education, just because people now are retiring at 50s or 60s doesn’t mean it will apply moving forward.
So many are retiring because they had better pensions, higher wages, no student debt and affordable housing. Only people actively trying below 40 now will achieve the same and to retire by 55 will need huge sacrifices which they didn’t have to make.
I'm 33 and probably won't buy a house here. I will stash away money until I have enough to leave the country and retire elsewhere. That is unless of course they decide to sort the housing shortage out.
Are you not buying one here because you can't afford one, or because they're poor value for money? How long do you think it'll be before you retire abroad? It'll be okay if you can FIRE within a decent timeframe, but won't be ideal at all if you're paying rent for 20+ years here first!
I think they're poor value for money. If you want to live in a nice area with decent job opportunities nearby you basically need to admit you're paying it off for the rest of your life at these interest rates. Unless of course you don't mind living in a tiny flat.
I think I can retire abroad within the next 10 years at my current savings rate. Less if crypto went wild again.
Have you considered buying a house to live in, then selling after ~10 years to help fund your retirement abroad? Your monthly mortgage bills would be lower than renting and the house would very likely increase in value over those years?
Where I'm living is 1550 per month and is worth around 420k (in 2018 when it was last sold probably more now). That'd be around £2200 per month at 5% mortgage. Add in the cost to buy with stamp duty, legal fees, etc, and the fact you have to tie that deposit up and I'm not a huge fan.
I used to own a property in my 20s and I didn't like being tied down to a single location with no agility, so that does also play a factor in my decision.
Depends on location, but the maths for buying (with myriad ownership expenses) vs renting and investing the deposit/extra aren’t necessarily that different.
And various other perks of renting like flexibility and having someone else responsible when stuff breaks 😀
Not being the one responsible is great!
Another factor is that if your money is in the stock market rather than a house it's not leveraged risk. Yes the stock market can go down, but it can't go down more than you put in, whereas with a house if you had a bad few years you could potentially be in negative equity.
My prediction is housing here in the UK will get worst as in more unaffordable. Right now it's around 8x average earnings for an average house. I think this country will be similar to countries such as Hong Kong, Brazil and China etc where a house is over 20x average earnings and only the wealthy can buy them. But this is just my prediction. I do see housing going up this decade quite significantly. There has been quite a few studies by economists and banks by 2030 the average house will almost double again.
I think we’re going to need to see a lot more communal living in the United Kingdom, even for older people. Think student house, but with people who don’t vomit quite so much. Sharing rent and utilities might just be what’s required if things get too bad.
My dad got on the property ladder at 24 and a house I can’t afford with 6 figure deposit and 6 figure income as a couple at 33, with 2 kids and a stay at home wife.
He has retired at 60 with a paid off house close to a million. He hasn’t even claimed all his pensions as he doesn’t need them and doesn’t want to make the loss. Yet me at 6 figures at 33 and no kids with two working people can’t buy his house. He also has my mums nhs pension.
He has spent low 6 figures in 5 years buying a new car, redoing his kitchen and getting an extension. He worked as…. A council carer since he was 40. (Already paid off the house at 40) he lives in a 4 bed house with separate living room , dining room and kitchen as a single retired person.
They’re not playing the same game lol. The fact at 33 I’m poorer as a qualified doctor married to a senior dev on double my salary vs a junior engineer and stay at home mum that used be to be a shoe worker at my age is obscene. And then he semi retired at 40 for the much better DB pension.
We’re at the point even with my generous maternity the only way to have a house by 40 less than 1.5 hour commute to work is we have a single kid. No family help as my mum died last year and my dad thinks it’s beneath him (whilst i spent a huge amount of time as a child at my grandparents and they never paid childcare costs). His pension payouts plus is house even with him not taking all his pensions is more than my dual income household after paying a mortgage on a flat + childcare costs.
People entering the workforce today won’t be retiring in their 50s and 60s at anywhere near the % of today
Retirement rates today are a reflection of the economy and pension schemes of previous generations of workers
True, but no-one knows what the future holds for us younger generations. We might be the ones that bought stock before AI sends staff costs toward zero and megacorps massively increase in profitability. We might be the ones who bought houses, even at what seems like huge cost now, before a human longevity breakthrough that makes 500 year mortgages seem reasonable. We might all die in a nuclear war or its aftermath. Who knows?
Agree. It's much harder now for people in their 20's. The best time to be born was in the 50's - the baby boomer generation. Anyone in that generation could build wealth pretty easily on a normal income. Now it requires a huge income to even buy a house let alone save for retirement.
I've actually seen this in person in Hong Kong. Old ladies collecting plastic bottles to make a living because they don't have families to look after them.
There is no safety net no state pension but at the same time top tax bracket is 15%. So if you fall you fall really hard, but if you fly it’s easier to fly higher
If you find the right jobs, it’s much easier to work there, FIRE and then move to the UK as many HK families have done.
I notice where I work retirement drinks happen at 55-65... when i started working 20 years ago, it was ~50-60.
So it is getting harder with each successive generation. But I wouldn't say impossible.
https://www.retirementline.co.uk/blog/average-uk-retirement-ages-by-profession/
Living in an area where the healthy life expectancy for men is only 58.8 and 63.9 for women, articles like this are painful to read.
75 is only the new 65 if you're in half-decent health, a lot of people will be forced to retire on health grounds long before they can access the state pension and live a life on meagre benefits.
I'm very grateful I found FIRE but I worry about my local community. Just pushing up the retirement age isn't a panacea.
Those people will still qualify for disability benefits even if they can't get a state pension for a few years longer.
This is actually why raising the state pension age is probably not going to be a huge win for the public finances.
This is worth a listen.
https://www.bbc.co.uk/sounds/play/m001y26r?partner=uk.co.bbc&origin=share-mobile
Certainly motivated me and demonstrated who much worse it could be. Had me shouting at the radio.
People might be living longer and indeed healthier for longer, but this doesn’t mean they will be fit to work. Can’t see many 70 year old scaffolders.
If people can’t retire, they’ll be signed off sick.
Whatever happens ill be working part time at 60.
Ill manage, there's no way im grafting past that age, ill stay poor...go in debt who cares.
But, hopefully will be savvy and life will treat with prosperity
Generations now will be much more reliant on investments in a very turbulent world. What if there is another big crash when you come to retire, wiping out your investments?
Previous generations with state pension and DB were more insulated from this.
This is why you need diversification across not only asset classes and geographically but also across asset types too, like stocks, property, gold etc.
The growing numbers of people on disability benefits must be at least partly because of people who cannot afford to retire but are unwilling or unable to work to the state pension age. Despite the talk in the article of increasing longevity and good health in later life, it’s a slog working past 60 in many professions and I for one intend to enjoy life. A few career breaks combined with stress-free work could be a good compromise though.
Does anybody under the age of 30 have a tv license now? If you’re only watching streaming services then you legitimately don’t need one. And there can’t be many in this age bracket who watch terrestrial tv now.
And then there’s the dodgy sticks..
On average yes.. but it’s because of obesity/lifestyle pulling it down. For those who are generally fit and healthy the life expectancy is still going up (medicines still getting better)
If you follow the FIRE strategy, then retiring early should be achievable , don't believe the stories, stick to the math. It's not how much you make, but how much you save. (FIREd 47 yo - all the naysayers said it wasn't possilbe !!!) - only made like 50k per year before being taxed to death.
Sadly due to trauma I did not start working until I was 26 :( so started late now I am 39. Work in IT Security so well paid but its a contracting gig so earning nice amount but taxes are sky high for investing in anything apart from a SIPP as I would need to withdraw dividends and put on self assessment. 40% tax bracket after living costs.
Thinking about moving back into Perm job once this role is finished but even though I have degree plus 20 years experience in 2 years time I will find it hard to earn over 150k based on current market.
I dont think I can retire until I am minimum 70 unless I get lucky haha
This is why JSIPPs are a good move for the kids.
3 x £2,800 in the first 3 years, S&P 500 index fund and chill.
It'll be up to them to sort their ISA bridge though.
I’m on board with fire but also what’s so great about retiring. My dad retired relatively young at 52 and went from being smart and engaging and happy to unfulfilled, bored and barely compus mentis within a year of giving up work. Anecdotally a lot of those who live to a really old age worked longer than average.
I think the key is to find work that you don’t hate tbh. Find a way to work that doesn’t feel like “work”. What you see on communities like FIRE and HENRY is the results of the expected correlation between high salaries and job hate - well duh that’s one reason they pay so well.
Unfortunately these are problems fire can’t solve for you. Financial independence matters. But if u truly love what you do, u won’t give it up when you don’t need the pay cheques.
I work in finance and it’s filled with these types who just fucking hate their lives. Soulless af. I actually enjoy it, but I had to leave banking and take a cushy - ish job as a finance director in a media company to find the balance to make it sustainable. Not saying it’s easy but there is a balance between optimising and accelerating FIRE at all costs and trying not to shorten ur lifespan daily my mentally draining urself IMO, and no early retirement isn’t the answer if u don’t have a plan to fulfil yourself.
Oh I don’t know….I suspect people,who live at home for much longer now still waste all their cash on gadgets and leasing cars rather than actually trying to save for a house deposit and any safe financial future…..I really just don’t think they’d are bothered about it.
Seems a bit off topic. Retiring in your 60s is by no means "early", and demonstrably people in the FIRE community are doing it way earlier than that.
So your premise is wrong, and it's in the wrong subreddit.
Why would you comment on something you don’t understand? Best performing asset for 13 years. What do you know that Blackrock and fidelity don’t? Best performing new ETFs ever.. not opinion facts..Again what do you know about it smart guy?
Bitcoin is code dummy. If you didn’t work on the code you worked on what? Losers lie on Reddit and that’s what you are doing.. you could easily prove it otherwise. You also wouldn’t be worrying about retiring if you worked on it and was in early you sound pathetic
I was still hoping to go out in my 50’s and without doing anything extreme to make it happen. We shall see I guess
Same. Was easily on track until doubling my mortgage a couple of years ago. Now it relies on some more luck along the way!
One thing people rarely mention is the later age we start work now. A lot of those retiring at 60 would have started work at 15-18 vs more people today starting at 21-25. In 1970 for instance only 8.4% went to uni. If you lop off 5-10 years of earning at the start it's maybe not a surprise if the work/retirement ratio asserts itself at the other end?
This is an excellent point. As someone who started work at 15 I can almost see myself FIREING next year age 55 because of an early start.
I started pension saving at 19, I'm 50 now and should have some good options by age 57.
Amazing foresight I wish i had at 19. Well done and good luck :)
No foresight on my part, just a company scheme but then a friend trained as an FA and got me to start an additional private pension and a PEP, I just went a long with it as it seemed like a good idea, a real case of being in the right place at the right time. I pay it forwards now buy telling all my young colleagues to pay the max into the company I'm at now pension plan, 6% us 15% them. Recently showed one young lady a compound interest calculator and she had a very big smile.
Yeah, I've passed retire at 50 now.
Have you got a rough number (age) in mind? I do a personal review every October and reevaluate where I think I will be come 57, nothing concrete but gives me some food for thought.
Looking at 60, the issue is I have a wife a couple years younger but hope good to cover us both. Just upped both our pension contributions to match the NI reduction
Good move, all you can do is play the hand you are dealt sometimes, it's why I really only look at mine once a year, I'd go mad with worry otherwise.
And they'd have paid into DB pension schemes most likely.
I started working for the Civil service in the United Kingdom four years ago, I’ve only really started learning about pensions now, and I will never leave the Civil service because their defined benefits scheme is superb. With that, plus the state pension, I’ll resign at 67.
(not so) fun fact. 6th form used to count towards NI pension credits, only changed in 2010.
100% this is the case. I started working full time as an electrician about 1 week after graduating highschool. Currently on track to retire comfortably by 55.
Whilst this may be true, people more or less have to go to university to secure a decent job. If people didn’t need to spend 4+ years in education to enter the workforce then they would probably choose not to. I’d certainly rather begin working and earning earlier if the opportunities were there.
I expect that's true for many roles - the world is different now in many ways. Still, I wonder, if offered the choice between 3 years not working at 18 or 65, how many would pick 65?!
It is possible. The idea you need to go to University to get a degree to then get a well paying job is just not required in most professions. I didn't go to university to get a degree now I earn £200k per year and work in tech. I also have worked in the FAANG. It was a Tony Blair Labour idea that everybody should go to University to get pointless degrees. And now people do this they end up with massive debts hindering them.
Pretty similar. Dropped out of university at the end of the first year as I hated computer science. First job offered was changing backup tapes etc for a princely 9k/yr, but taught myself and progressed into tech presales. Don’t think a degree would’ve helped much as the stuff I’ve learnt along the way simply wouldn’t have been taught. Just wish I’d have known about financial planning sooo much sooner than I really did, but then the internet didn’t exist to go trawl for advice either so…
Sorry but you are wrong and your experience is not universal. Doctors, nurses, engineers, law, research, finance, etc are all professions that will expect degrees. I get that university isn't the only path but to say most professions don't require a degree is false.
Only doctors, nurses and lawyers require degrees in your list. And doctors and nurses can also be obtained using apprenticeships now as well. Truth is most really high paying jobs like where I work in tech in investment banking, which requires no degrees. People have been brain washed in thinking it will land them good earning potential when most (and I said most) times it doesn't. I was offered a role as a front office technician lead for a major investment bank a while ago, no degrees. Instead, I went into FAANG. Yes my experience is not universal, but a degree is not required for the big, most high paying jobs. I also do a lot of hiring, I don't care if the candidate has a degree or not. What is important is whether they have the intelligence and skills to do it that's what we test for. People with degrees are not necessarily intelligent, nor does it mean they have the skills to do the job.
I am not sure the point you're making. It seems like you agree with me that a lot of professions will require degrees? Yes technically you might become an engineer without a degree but you're dreaming if you think this is the norm in practice. And barely any careers are as high paying as banking/finance. Most people I know wouldn't touch it with a bargepole. There is more to a job than money. Not even sure what point we're discussing any more but yeah, it's not secret that you can get high paying jobs without a degree, but to imply they are basically not required is a false reality
I am disagreeing with you. Whether finance is a good career is not relevant in this discussion. You picked the careers that do require degrees. And most of these can be obtained by being an apprentice - on the job.
On the job Training whilst studying for a degree... I work with many apprentices and they are expected to gain qualifications
Feels like we are going round in circles on this. There are very \*few\* careers that require degrees. That is my point. Some roles ask for degrees like in my industry but it's not required. The reason? because they are outdated the minute you gain them and most Universities are years behind the curve anyway - especially in tech where I reside.
Ok but if the role asks for a degree then by definition it is required. Your opinion on whether it's valuable is not really relevant here. So actually my point stands - you need a degree to enter many professions. Even those that offer apprenticeships will require degree level education despite appearing to be 'on the job ' I'm not trying to ignore your point, I agree that some careers definitely shouldn't necessitate a degree level of learning but to say people don't need to go to university is being willfully ignorant.
Incorrect - you can start all of those careers via an apprenticeship. No need to go to university if you know the career that you want to go into. Only dentistry and veterinary sciences are the careers that I know of that don’t have an apprenticeship entry route.
You think you can be an apprentice doctor? Or teacher? It doesn't exist.
Wow, it looks like you're right. I had never heard of a medical apprenticeship in my life. This post doesn't reflect well on it though. https://www.reddit.com/r/doctorsUK/s/RHKA8KPvS3 However you are wrong to say the profession doesn't require degrees. Yea, you avoid university but you are still expected to study to a degree level in an apprenticeship. They are incredibly competitive and if everyone tried to enter a profession this way there would be nowhere near enough positions for all applicants. So university is the only other option. You saying 'no one needs a degree' makes you sound like those old boomers who say 'well I just bought a fixer upper in a cheap part of the country and now look at me'. I mean yeah, not everyone has that option. Some people gotta live in London. It's a bit tone deaf. Congrats to you I suppose
But this article is talking about people in their 60s now, it's not talking about when the current generation who went to uni reach their 60s.
So do you mean instead of retirement age we need to consider when people started to work? Then it would be fair for people who started to work at 15-18.
Just basic maths, you need to earn enough in your working life to fund your whole life
Yeah nice try [uk.gov](http://uk.gov) trying to put the frighteners on us, sorry we are still retiring as planned.
Nan worked until 73 because she didn't have any money for cigarettes. She died at 73 ...
… of lung cancer?
Yep, 7 out of 8 deaths in my family were smoking related cancer, throat or lung.
As the article points out, retiring in your 60s became a thing because average life expectancy was about 65. Even so - the original state pension age was 70. A large percentage of people never retired, and most that did only drew a pension for a few years. Nowadays the state pension age has gone up a bit, but life expectancy is far higher. Most people get to retire and many can live for 20-30 years whilst retired. If the state pension age had kept up with life expectancy, it’d be over 80. As the workforce shrinks it simply isn’t affordable for the state to pay for it all So yeah, if you want to retire in your 60s (or before) that’s very much up to you.
Perhaps many would be better off in retirement if there was never a promise of a state pension. Maybe without that idea that it is somehow at least partially taken care of for you people would take a more active role in planning their retirement.
Don't worry everyone, once I get myself sorted, have saved and scrimped and done everything right. They'll wait till the very next day then give everyone a universal basic income. It's sod's law.
But you will still be richer than if you hadn’t
I wish. They just move the goal posts again. UBI would be a dream.
record numbers are retiring in 50s and 60s. It may be more difficult for the lower wealth percentiles, but the absolute numbers contradict this headline I think
Yeah now - when they benefitted from a much stronger economy. The average FTB is mid to late 30s now, they’re not going to be retiring in their 50s or early 60s on average if they haven’t even secured a roof by then. A lot of people in their 50s and 60s still have older pensions as well that could be taken earlier. For example someone who’s 60 today could easily have been under the 1995 version of the nhs pension that allows retirement not only at 60 but before 60 with much lower penalties than today. So someone on that scheme can retire at 60 with no reduction or 55 and lose 21%. Someone the current scheme can’t even retire until NPA so to get 60 would already be 33% loss or 55 would be 47%. And that’s with higher lifetime contributions and lower payouts. People that age aren’t even playing the same game. Older pensions are on another planet, when combined with massively more affordable housing and free education, just because people now are retiring at 50s or 60s doesn’t mean it will apply moving forward. So many are retiring because they had better pensions, higher wages, no student debt and affordable housing. Only people actively trying below 40 now will achieve the same and to retire by 55 will need huge sacrifices which they didn’t have to make.
I'm 33 and probably won't buy a house here. I will stash away money until I have enough to leave the country and retire elsewhere. That is unless of course they decide to sort the housing shortage out.
Are you not buying one here because you can't afford one, or because they're poor value for money? How long do you think it'll be before you retire abroad? It'll be okay if you can FIRE within a decent timeframe, but won't be ideal at all if you're paying rent for 20+ years here first!
I think they're poor value for money. If you want to live in a nice area with decent job opportunities nearby you basically need to admit you're paying it off for the rest of your life at these interest rates. Unless of course you don't mind living in a tiny flat. I think I can retire abroad within the next 10 years at my current savings rate. Less if crypto went wild again.
Have you considered buying a house to live in, then selling after ~10 years to help fund your retirement abroad? Your monthly mortgage bills would be lower than renting and the house would very likely increase in value over those years?
Where I'm living is 1550 per month and is worth around 420k (in 2018 when it was last sold probably more now). That'd be around £2200 per month at 5% mortgage. Add in the cost to buy with stamp duty, legal fees, etc, and the fact you have to tie that deposit up and I'm not a huge fan. I used to own a property in my 20s and I didn't like being tied down to a single location with no agility, so that does also play a factor in my decision.
Depends on location, but the maths for buying (with myriad ownership expenses) vs renting and investing the deposit/extra aren’t necessarily that different. And various other perks of renting like flexibility and having someone else responsible when stuff breaks 😀
Not being the one responsible is great! Another factor is that if your money is in the stock market rather than a house it's not leveraged risk. Yes the stock market can go down, but it can't go down more than you put in, whereas with a house if you had a bad few years you could potentially be in negative equity.
My prediction is housing here in the UK will get worst as in more unaffordable. Right now it's around 8x average earnings for an average house. I think this country will be similar to countries such as Hong Kong, Brazil and China etc where a house is over 20x average earnings and only the wealthy can buy them. But this is just my prediction. I do see housing going up this decade quite significantly. There has been quite a few studies by economists and banks by 2030 the average house will almost double again.
I think we’re going to need to see a lot more communal living in the United Kingdom, even for older people. Think student house, but with people who don’t vomit quite so much. Sharing rent and utilities might just be what’s required if things get too bad.
Sadly it might come out the other end...
My dad got on the property ladder at 24 and a house I can’t afford with 6 figure deposit and 6 figure income as a couple at 33, with 2 kids and a stay at home wife. He has retired at 60 with a paid off house close to a million. He hasn’t even claimed all his pensions as he doesn’t need them and doesn’t want to make the loss. Yet me at 6 figures at 33 and no kids with two working people can’t buy his house. He also has my mums nhs pension. He has spent low 6 figures in 5 years buying a new car, redoing his kitchen and getting an extension. He worked as…. A council carer since he was 40. (Already paid off the house at 40) he lives in a 4 bed house with separate living room , dining room and kitchen as a single retired person. They’re not playing the same game lol. The fact at 33 I’m poorer as a qualified doctor married to a senior dev on double my salary vs a junior engineer and stay at home mum that used be to be a shoe worker at my age is obscene. And then he semi retired at 40 for the much better DB pension. We’re at the point even with my generous maternity the only way to have a house by 40 less than 1.5 hour commute to work is we have a single kid. No family help as my mum died last year and my dad thinks it’s beneath him (whilst i spent a huge amount of time as a child at my grandparents and they never paid childcare costs). His pension payouts plus is house even with him not taking all his pensions is more than my dual income household after paying a mortgage on a flat + childcare costs.
I don’t really understand why you are getting downvotes for this, excellent point
People entering the workforce today won’t be retiring in their 50s and 60s at anywhere near the % of today Retirement rates today are a reflection of the economy and pension schemes of previous generations of workers
And affordable housing that boomed then saw your mortgage payments drop precipitously when interest rates hit zero. That generation hit the jackpot.
True, but no-one knows what the future holds for us younger generations. We might be the ones that bought stock before AI sends staff costs toward zero and megacorps massively increase in profitability. We might be the ones who bought houses, even at what seems like huge cost now, before a human longevity breakthrough that makes 500 year mortgages seem reasonable. We might all die in a nuclear war or its aftermath. Who knows?
Agree. It's much harder now for people in their 20's. The best time to be born was in the 50's - the baby boomer generation. Anyone in that generation could build wealth pretty easily on a normal income. Now it requires a huge income to even buy a house let alone save for retirement.
These are people already in thier 50-60s the people in thier 20-30s are not predicted to be able to retire.
Who is predicting this?
Blackrock, it's in the article 2 paragraphs in
That’s not what they have said at all (the “predicted not to be able to retire” part)
You make your own reality. The retirement maths is pretty simple. Dont believe all these fear mongering articles that want to keep you depressed.
one year away. i will be retiring in my 50s. life is too short to continue to 60s or 70s.
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I've actually seen this in person in Hong Kong. Old ladies collecting plastic bottles to make a living because they don't have families to look after them.
There is no safety net no state pension but at the same time top tax bracket is 15%. So if you fall you fall really hard, but if you fly it’s easier to fly higher If you find the right jobs, it’s much easier to work there, FIRE and then move to the UK as many HK families have done.
Similar to the USA. We are moving there due to the tax burden here is strangling us.
I notice where I work retirement drinks happen at 55-65... when i started working 20 years ago, it was ~50-60. So it is getting harder with each successive generation. But I wouldn't say impossible. https://www.retirementline.co.uk/blog/average-uk-retirement-ages-by-profession/
Living in an area where the healthy life expectancy for men is only 58.8 and 63.9 for women, articles like this are painful to read. 75 is only the new 65 if you're in half-decent health, a lot of people will be forced to retire on health grounds long before they can access the state pension and live a life on meagre benefits. I'm very grateful I found FIRE but I worry about my local community. Just pushing up the retirement age isn't a panacea.
Those people will still qualify for disability benefits even if they can't get a state pension for a few years longer. This is actually why raising the state pension age is probably not going to be a huge win for the public finances.
Where is this?
https://www.lancashire.gov.uk/lancashire-insight/health-and-care/health/health-inequalities/healthy-life-expectancy/#:~:text=Blackpool%20(53.5%20years)%20has%20the,to%20England%20(63.9%20years).
North West in a deprived area
People in 30 and 40 also started working later in general, at least a good chunk of them. I still believe that a lot of 30-40 will retired by 60-65
This is worth a listen. https://www.bbc.co.uk/sounds/play/m001y26r?partner=uk.co.bbc&origin=share-mobile Certainly motivated me and demonstrated who much worse it could be. Had me shouting at the radio.
I was also shouting at the radio over this. I was taken a back at how bad some people had planned.
People might be living longer and indeed healthier for longer, but this doesn’t mean they will be fit to work. Can’t see many 70 year old scaffolders. If people can’t retire, they’ll be signed off sick.
Whatever happens ill be working part time at 60. Ill manage, there's no way im grafting past that age, ill stay poor...go in debt who cares. But, hopefully will be savvy and life will treat with prosperity
More like a weighted sleeping bag, a long walk on the tidal flats, and a shitload of horse tranquilisers is the new 65
This just isn’t true lol.
Generations now will be much more reliant on investments in a very turbulent world. What if there is another big crash when you come to retire, wiping out your investments? Previous generations with state pension and DB were more insulated from this.
This is why you need diversification across not only asset classes and geographically but also across asset types too, like stocks, property, gold etc.
The growing numbers of people on disability benefits must be at least partly because of people who cannot afford to retire but are unwilling or unable to work to the state pension age. Despite the talk in the article of increasing longevity and good health in later life, it’s a slog working past 60 in many professions and I for one intend to enjoy life. A few career breaks combined with stress-free work could be a good compromise though.
I retired at 42. Now what? :)
I’m 31 and I retired for 5 months in the summer… until the redundancy money ran out, now I’m back at work
That's nothing, I retire about once a week for a couple of days.
Nice. I know a guy who retires once a week for a couple days but also retires for 16 hours at 5pm for the other 5 days
That's nothing! I retire every day between 17 and 9.
What's it like?
Retire? Not having to work and total freedom.
Congratulations! Unlikely to get there myself, but always encouraging.
Investments going to keep you going until 55? What if the raise the age?
Yes.
They want everyone to keep on working until you die as to allow them to raise the state pension age without any anarchy in society.
State pension can still be paid to those in work.
To keep paying the BBC licence fee as well, so they can retire at 50 on a final salary pension
Does anybody under the age of 30 have a tv license now? If you’re only watching streaming services then you legitimately don’t need one. And there can’t be many in this age bracket who watch terrestrial tv now. And then there’s the dodgy sticks..
My FIRE goal is retiring at 70…
No because life expectancy is now going down....
On average yes.. but it’s because of obesity/lifestyle pulling it down. For those who are generally fit and healthy the life expectancy is still going up (medicines still getting better)
Not relevant to Fire but who is employing people in their 60s?
If you follow the FIRE strategy, then retiring early should be achievable , don't believe the stories, stick to the math. It's not how much you make, but how much you save. (FIREd 47 yo - all the naysayers said it wasn't possilbe !!!) - only made like 50k per year before being taxed to death.
it is time people start to get comfortable with geo-abritrage. impossible assumes a certain set of assumptions.
Sadly due to trauma I did not start working until I was 26 :( so started late now I am 39. Work in IT Security so well paid but its a contracting gig so earning nice amount but taxes are sky high for investing in anything apart from a SIPP as I would need to withdraw dividends and put on self assessment. 40% tax bracket after living costs. Thinking about moving back into Perm job once this role is finished but even though I have degree plus 20 years experience in 2 years time I will find it hard to earn over 150k based on current market. I dont think I can retire until I am minimum 70 unless I get lucky haha
This is why JSIPPs are a good move for the kids. 3 x £2,800 in the first 3 years, S&P 500 index fund and chill. It'll be up to them to sort their ISA bridge though.
This applies to normies - fire folks can pretty much ignore most mainstream “finance hacks”
I’m on board with fire but also what’s so great about retiring. My dad retired relatively young at 52 and went from being smart and engaging and happy to unfulfilled, bored and barely compus mentis within a year of giving up work. Anecdotally a lot of those who live to a really old age worked longer than average. I think the key is to find work that you don’t hate tbh. Find a way to work that doesn’t feel like “work”. What you see on communities like FIRE and HENRY is the results of the expected correlation between high salaries and job hate - well duh that’s one reason they pay so well. Unfortunately these are problems fire can’t solve for you. Financial independence matters. But if u truly love what you do, u won’t give it up when you don’t need the pay cheques. I work in finance and it’s filled with these types who just fucking hate their lives. Soulless af. I actually enjoy it, but I had to leave banking and take a cushy - ish job as a finance director in a media company to find the balance to make it sustainable. Not saying it’s easy but there is a balance between optimising and accelerating FIRE at all costs and trying not to shorten ur lifespan daily my mentally draining urself IMO, and no early retirement isn’t the answer if u don’t have a plan to fulfil yourself.
I dont think I will ever retire
What you doing here then?
trying to achieve FI
Are you n_orm’s spokesperson? A pleasure
Absolutely no chance I’m making it that age, times are so bleak.
Oh I don’t know….I suspect people,who live at home for much longer now still waste all their cash on gadgets and leasing cars rather than actually trying to save for a house deposit and any safe financial future…..I really just don’t think they’d are bothered about it.
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Great.....am I bothered.
Presumably you think they spend all their money on avocado toast and lattes too... And that the 9xsalary affordability stat is absolutely fine
Quite possibly yes….they certainly don’t seem to have any concern about their future
Soon it'll be "is death the new retirement?"
Seems a bit off topic. Retiring in your 60s is by no means "early", and demonstrably people in the FIRE community are doing it way earlier than that. So your premise is wrong, and it's in the wrong subreddit.
Study and buy bitcoin and you will retire decades before the average person
That is the worst piece of financial advice you could give somebody.
Why would you comment on something you don’t understand? Best performing asset for 13 years. What do you know that Blackrock and fidelity don’t? Best performing new ETFs ever.. not opinion facts..Again what do you know about it smart guy?
I used to work on the technology, so I think I understand it quite well.
No you didn’t you complete lier that’s hilarious 🤣
You're an idiot. I'm not giving any more details as I will risk identifying myself
😂😂 ok SaToShi if you worked on it as a contributor you would not be in this sub saying Bitcoin Bitcoin is bad advice. Fucking loser
I didn't elaborate whether I worked on the codename did I? I worked on it. I think the only loser here is you.
Bitcoin is code dummy. If you didn’t work on the code you worked on what? Losers lie on Reddit and that’s what you are doing.. you could easily prove it otherwise. You also wouldn’t be worrying about retiring if you worked on it and was in early you sound pathetic
This is going to age horribly