Moneymakeover Money makeover: advice on retirement planning and other suggestions

SharkT said:
Do you think retirement in 3 years is realistic?
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Of course, if your figures above are correct then you could pack it in tomorrow if you felt like it.

In my opinion, you should ignore all the comments above regarding what you'll do with your time. It's nobody's business but yours (and your wife). Once both of you are in agreement then do what is right for you and your family.

On the financial side:

SharkT said:
Yes. Value €500,000. Mortgage tracker ECB+1.15% €130,000 remaining (14 years). Rented for €2250 a month gross. Agency looking after it. Have just giving notice on this in June hoping to put on market march next year assuming tenants vacate.
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Normally I would advocate for selling but that is normally driven by people's lack of understanding of their own financials and that they are barely breaking even. Your case is different, a lot of risks are mitigated by your spouses salary. If you could get it closer to market rent then it would be very tax efficient if this income was in your name once you retire. You also have a lot of cash needlessly sitting around doing nothing. Just clear that mortgage tomorrow and clean up your finances

SharkT said:
Me €380,000 previous pension (Aviva buyout bond)
Me €360,000 new pension
Wife pension €500,000 (Aon lifestyle type fund
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Your pensions are very healthy. If you keep the rental then you can probably leave them untouched but if needed you could turn one into an ARF and draw down ~€19/20k. Again it is very tax efficient and supports your need for PRSI

SharkT said:
Expenditure pattern:
After-school childcare at 450 per month.
Mortgage on rental property is approx 1,250 per month.
Excluding these we probably spend 3-3.5k per month. But prob spend another 7-10k annually on holidays.
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This is a critical one. You have a lifestyle spend of ~€50k. This would be considered comfortable for most but your household income is €300k+. It would be easy to spend more on lifestyle, justifiably so, with that level of income.

Before pulling the trigger on retirement, I would get very comfortable with your yearly expenditure so that you don't get any surprises. Include the regular irregulars like car upgrades and home improvements

A final point, when you do finally retire, make sure you are jointly assessed so that your combined income is taxed correctly and credits are transferred appropriately.

SharkT said:
I would like to retire as soon as I comfortably can
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What is stopping you from doing so now?

Financially you can afford it. If you don't particularly enjoy your work then why continue?

I think it may have been mentioned already but if there is any chance of redundancy then I would start working on it. Make it known that you would consider it if the offer was right.
 
Thanks all for the replies and feedback.
A couple of potentially relevant pieces of info and responses.

Both our cars are over 12 years old so will need replacing in the next few years. But won't be replacing with anything extravagant.
We will probably do some work on the house possible 100-150k in the next 5 years.

I'm happy to work for another couple of years even though I don't love it, I don't mind certain aspects of it. I am also conscious that I want to show an example to the kids in terms of work ethic while they are young. My wife would also like me to continue to work for the next couple of years.

My wife and I are on the same page in terms of my proposed retirement timeline. I would also be able to take on more of the work around the house etc as my wife has a demanding job. My hobbies are not expensive really so I don't anticipate a significant cost associated there.

With regards to the rental property, we would have liked to keep this for a bit longer, but with the regulation we want to get out before we would have to renew our tenants contract under the new part 4 tenancy regs.

In our rental case we have one lead tenant with other individuals on the lease. The problem would be if the lead tenant were to leave at some point (e.g. 5 years time), we would need to get another tenant as the lead tenant and could potentially be another 6 year before we could sell. That could occur again and again and it could be difficult to get the property back. It has served us well and we are ready to let go and simplify. We may potentially look into buying something for our kids once college comes around, if it makes sense.

We don't see the point in clearing the remaining mortgage right now when we can write off the rental interest anyway and it should all be resolved and cleared assuming we can sell next year.

Regarding our Zurich investments, we have only recently set them up and are happy enough with the management fees. Assuming we sell the rental property next well year we will hopefully contribute more to these and be in a position to perhaps negotiate a more favourable management fee.

Regarding our pensions, we are happy that the charges are competitive.

Work-wise I may be in a position to see if redundancy if an option. I was thinking about putting the feelers out about it in a couple of years. It may be possible but may not happen either so not going to bank on it.

Appreciate all taking the time to read and respond.
 
I retired early (54) to spend both more time and better quality time with my kids. For us, it was invaluable. I see other family members really struggling to balance stressful jobs with school runs, sports runs, early scheduled and unscheduled pick ups, kids sick days etc etc. I have seen serious health concerns for same enter the mix with the real possibility of kids losing both parents.... fortunately, both have gone through treatment successfully and are recovering... but both back into their original demanding jobs again... given a second chance and no lessons learned. I digress.

As many have have stated here and elsewhere, you will NOT get this time back with your kids, not ever. With respect to your planning for large expenses such as replacing cars... if they are reliable, keep them. Retired 3 years now, lost all interest in cars... apart from reliability, those status "things" lose all importance and standing. Having time to really indulge your kids while they want you around is so precious. Being able to spend more time on your hobbies while you are fit and healthy will have all kinds of indirect benefits for your longevity too.
 
I'm 56 and planning to retire next year. Our household balance sheet is also strong, although not quite on par with the OP.

I had a 9-month break a couple of years ago after getting redundancy from the company I had worked for over 20 years. Job hunting at 50+ is not easy.

I loved the freedom in those 9 months: caught up with family and friends, went to football matches, did some DIY around the house, got reacquainted with my bike and felt better than I had for years ... the only cloud was the slow job search (which eventually resolved itself).

I can't wait to step off the treadmill (hopefully for good).

My point is: we don't know how much time we have ahead of us. But try to maximise it. If it feels right to retire and you are financially able to - go for it!
 
Boyddbookman said:
I retired early (54) to spend both more time and better quality time with my kids. For us, it was invaluable. I see other family members really struggling to balance stressful jobs with school runs, sports runs, early scheduled and unscheduled pick ups, kids sick days etc etc. I have seen serious health concerns for same enter the mix with the real possibility of kids losing both parents.... fortunately, both have gone through treatment successfully and are recovering... but both back into their original demanding jobs again... given a second chance and no lessons learned. I digress.

As many have have stated here and elsewhere, you will NOT get this time back with your kids, not ever. With respect to your planning for large expenses such as replacing cars... if they are reliable, keep them. Retired 3 years now, lost all interest in cars... apart from reliability, those status "things" lose all importance and standing. Having time to really indulge your kids while they want you around is so precious. Being able to spend more time on your hobbies while you are fit and healthy will have all kinds of indirect benefits for your longevity too.
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Thanks for the reply and hope your family members recover well.

One question please, how did you find going from building your wealth while working to now depleting your wealth. Did it impact you at all or was it an easy mindset change? Did your spending nature change at all?
 
Its a very valid question. From an early age (mid 20s) I had set a target early retirement age and focused on that. Plenty of analysis conducted on current and projected expenses so I knew my "number". Always reminded myself that my corporate career was simply a means to enable me to retain more control of my early retirement date. In retrospect, I always felt my own corporate career was transient, albeit over an extended period of time, so it was not a significant shift to move from earning to "not earning". Having said that, I do closely track our family outgoings. I don't worry about finances, but I am always mindful of outgoings.
 
Cash savings depleting, but other investments (fortunately) growing to partially, not fully, offset the level of depletion.
 
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