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A newbie from across the pond
Old 06-28-2015, 09:42 AM   #1
Confused about dryer sheets
 
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A newbie from across the pond

Hi there. I’ve been lurking for a little but thought it best I stop and actually introduce myself. As you might guess from the name I am British and now UK-based, but I worked overseas for over 20 years and was lucky enough to benefit from good expat packages and generally lower tax rates than the UK, so saved quite a bit. I’m coming up to 49 years old and Mrs. BritChap and I have two lovely daughters aged 12 and 6.

So…..we have around 3.3m in non-pension assets, split 1.8m in stocks / tracker-style funds, 300k fixed deposits, 300k peer-to-peer lending, 100k in wine (if it all goes to hell I can at least drink some of our assets!) and 800k in an investment property that we let out. In addition to this, we also own our own home, which is worth around 1.4m. We have no debt.

Pension-wise, I have a DB pension from a previous job that will pay me 47k p.a. (in today’s money – it is inflation protected up to max of 5% p.a.) when I hit 60. I also have DC contributions into my current pension scheme, which I estimate will produce a pension of 11k p.a. from the age of 55. I continued to contribute to National Insurance whilst I was abroad so I will get close to a full state pension when I hit 67. That’s about 5k p.a. in today’s money. Mrs. B. does not work or have any pension herself.

My work is in the financial services industry and by most people’s standards it is very well remunerated. I can generally save around 150k a year, depending on bonus levels and stock price performance. But it is very intense, involves lots of overseas travel (not always to the most desirable of places) and I am getting very close to the point of throwing the towel in, so that I can actually be with my family rather than away from home or locked away in my study when I am not at the office. There is a possibility that I could do some consultancy work after retiring, and I will certainly aim for that, but it cannot be absolutely counted on. I don’t imagine doing nothing at all, but I’m not factoring any post-retirement job income into my plans as it is very uncertain what that would be and I am not going to be looking for anything too well remunerated anyway, because that would likely just put me back to ‘square one’ in term of lifestyle.

I conservatively estimate our current year spending to be 70k. That includes my younger daughter’s current school fees of around 11k a year but not my older daughter’s education to 18 (which I have pre-paid as there is a minor tax advantage to do so). It also factors in allowances for a new car every five years or so, home upkeep etc. It might sound high to some, but it translates to a comfortable middle class existence for a family in a nice enough part of London, rather than the lifestyle of the rich and famous.

The plan is to sell the house and move out of London when my younger daughter heads off to senior school in 5 years time. I think we will have no trouble finding somewhere we like for around half of the value of our current home, thus liberating around 700k to go into income-generating assets.

I guess I am stuck in a bit of a OMY syndrome. Partly this is because the money is good (and, whenever I leave, I walk away from at least 500k in ‘golden handcuffs’) and partly because the kids are relatively young, and I do not want to risk their education at all. That said, I’ve had a crack at FIRECalc and have my own financial modeling on a spreadsheet: the conclusion I come to is that it would take a really quite pessimistic set of circumstances to prevail for a longish time before we have much of a threat to our financial security.

Whilst this forum is truly great, it is of course US centric. So that makes the general advice very useful but not so much things for things like tax. I would be particularly interested if anyone knows any really good retirement modeling resources for the UK and any ideas around best managing the tax implications of moving from employment to retirement in the UK. Of course, any general comments on whether I am being an idiot for not just retiring now (or perhaps not?) would be welcome too.

Cheers!
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Old 06-28-2015, 04:35 PM   #2
Recycles dryer sheets
 
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You have enough. You really just need to "bridge" the five years until your younger daughter starts senior school. To make the change less abrupt, why don't you take the appropriate management person out to lunch and broach the idea of a consultancy? As DH pointed out to me, when I was in a similar situation 3 years ago, the worst that could happen is that your request is denied.
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Old 06-28-2015, 05:12 PM   #3
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Welcome to the site.

The taxation in the UK, and the tax-free and tax-deferred vehicles available in the UK (ISA's, SIPP's etc) are so different from what we have here in the US then I'm afraid you'll be out of luck getting specific advice on your situation.

Have you tried Googling for UK style retirement calculators? You will find links like https://www.retireeasy.co.uk/ but on this site you won't any or many folks that can give useful feedback on how good it is.

How about brokerages in the UK, I know that Fidelity has a UK presence. Does Fidelity UK have the Fidelity Retirement Income Planner available for UK customers?
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Old 06-29-2015, 12:00 AM   #4
Confused about dryer sheets
 
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Thanks Alan. Your Googling skills are clearly better than mine because you have given me two new websites to look at that I hadn't spotted before! The Fidelity one in the UK has some parameters that are capped in places that aren't applicable to me (it doesn't allow retirement savings of more than 1m and a retirement date before 55). Nonetheless, plugging in the data and 'fudging' the thing a bit, it suggests I will be fine. I will have a crack at the retireeasy one this evening and see what that says.
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Old 06-29-2015, 12:03 AM   #5
Confused about dryer sheets
 
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Quote:
Originally Posted by Pbkmaine View Post
You have enough. You really just need to "bridge" the five years until your younger daughter starts senior school. To make the change less abrupt, why don't you take the appropriate management person out to lunch and broach the idea of a consultancy? As DH pointed out to me, when I was in a similar situation 3 years ago, the worst that could happen is that your request is denied.
You are right. I will confess that part of my issue is I don't want to let anyone down at work. However, at the end of the day, if I give them enough notice of my intentions I'm hardly being unreasonable and, as you point out, what's the worse that could happen? I just have to pick my moment....!
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Old 06-29-2015, 12:33 AM   #6
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Quote:
Originally Posted by BritChap View Post
Thanks Alan. Your Googling skills are clearly better than mine because you have given me two new websites to look at that I hadn't spotted before! The Fidelity one in the UK has some parameters that are capped in places that aren't applicable to me (it doesn't allow retirement savings of more than 1m and a retirement date before 55). Nonetheless, plugging in the data and 'fudging' the thing a bit, it suggests I will be fine. I will have a crack at the retireeasy one this evening and see what that says.
Glad to help. I understand your hesitation to retire with such young children. At your age my 2 children had flown the nest. DD had graduated and was working, DS was 2 years into college, graduating 2 years later so we able to retire at 55 with no fledglings to worry about financially.
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