How Are We Doing?

[uryjm]

I just wondered how people are faring with their retirement plans and strategies at the moment?
Personally, my investments have taken a bit of a kicking, but I'm surprised about how little I'm bothered by "losing" a substantial sum in the past few weeks. It's the equivalent of about two years of my projected retirement spending, so it should be a bit of a blow. I'm probably thinking it will all come back in time and at least I've got my health at the moment. Retirement can wait, and anyway, isn't this lockdown a bit of a taster for retirement living? I've now time to do all those things I wanted to do when I was at the office and, of course, I'm not doing any of them. Plus I'm missing the social contact at work. I'm "working from home" and often quite glad that this gives me something to do on a showery weekday afternoon.
So, for me, I'm just trying to take each day as it comes. I've done nothing with my investments, not sold, bought or swapped. In a lot of ways this lockdown has kind of forced me to stop thinking about such things. Whatever happens, we'll just need to get on with it. I wondered how other people are facing into the future, given that this is what Retirement Investing asks you to think about?

[James]

Forecast monthly income for retiring in five years is down c 20%, but too old to be looking at 'early' retirement Will be okay in 10 years at current projections and maybe earlier depending on recovery.

[swill453]

At the rate we're spending in lockdown, our cash buffer will last about 7 years! So the equities will look after themselves, not really worried. Income will definitely be down over the next year or two, but nothing we're not prepared for.

Scott.

[Itsallaguess]

I've had a slight change of plan, in that I've now decided that I want to leave home and spend the remaining years of my life living at work....

Cheers,

Itsallaguess

[JuanDB]

I’ve just completed my end of month net worth calculation and have arrived at the conclusion the result are a complete nonsense at present. Last month i was down £120k, this month I’m up £140k. I take both numbers with a huge pinch of salt.

Best to ignore it all for at least 3-6 months is my best advice to myself.

On the plus side, as an introvert I’m more than happy for lockdown to continue and will be pretty sad when it lifts and normal working patterns resume. Hell is other people and two hours a day commuting.

Cheers,

Juan.

[monabri]

I’ve just completed my end of month net worth calculation and have arrived at the conclusion the result are a complete nonsense at present. Last month i was down £120k, this month I’m up £140k. I take both numbers with a huge pinch of salt.

Best to ignore it all for at least 3-6 months is my best advice to myself.

On the plus side, as an introvert I’m more than happy for lockdown to continue and will be pretty sad when it lifts and normal working patterns resume. Hell is other people and two hours a day commuting.

Cheers,

Juan.

Interesting, I'm curious as to how your portfolio's value has changed so violently? Are you saying you are now +£20k on the value or has there been a "movement" of £260k?

[JuanDB]

Net is +£20k vs 1st March. That’s change in total net worth rather than just investment portfolio. This includes property which I value using a consistent method but saw big swings m/m. Also includes restricted stock options valued in USD where the relevant stock price has had a lot of volatility (nasdaq listed tech company).

I’m away from computer now but I believe investment portfolio is down about 17% vs 1st March across GIA, ISAs, SIPPs and other pensions.

Cheers,

Juan.

[tjh290633]

My figures are from the close on 29th February, as I record them for the last day of each month.

Down 10.6% to 31st March
Down 4.8% to 30th April

That is for an HYP with no cash extracted and none added.

TJH

[TahiPanasDua]

I'm sure everyone is forced into spending much less than usual due to lockdown. That is one positive in a sea of despondency and we should be thankful for small mercies. For me it gives an insight into how little we could actually live on were things to get even worse. My gast has been truly flabbered by how little we are actually spending.

We pay ourselves a monthly sum based on 90% of last year's dividend income and are surprised to note that over the past 3 months we are actually spending only 55% of that without any economy beyond that imposed by the gubmint. We could, for example, save a further 15% at the stroke of a pen by ditching (overly-generous) charitable donations.

I find that remarkably cheering. Whilst everyone's circumstances are different, particularly those who now find themselves jobless with families to support, I hope there is at least a crumb of comfort in now knowing with greater certainty what we are capable of as distinct from worrying ourselves to death imagining ever-increasing horrors.

TP2

[TUK020]

I am amzed by how much lower my monthly credit card bill is on casual expenditure.
Starting with £250/month not spent on diesel to cover a lengthy commute

[uryjm]

Yup, I'm saving £150 a month on diesel too. In turn, I've overspent that on food versus other months. Of this, I think the biggest expenditure is on those damn coffee pods, especially on the cappuccino ones that my DOH insists on. Whereas I get 16 cups from my box of pods, she gets 8 because the other 8 are milk. This could well be cited in divorce proceedings if it continues.

[JohnB]

I think many people are trying out FIRE lifestyles now, checking how it feels being exposed to Mr Market, and what they hate and enjoy about work. After 3 months they will have a clearer idea about what expenditure makes them happy.

Being a FIREd introvert who is forced to live in the wrong place for much of his social circle, things haven't changed so much. I'm seeing more of many people, though Zoom pub meets are an inferior experience. I don't miss food cooked by others, but I do miss the change of scene of seeing different places and museums as I always hope Spring will relieve my Winter cabin fever.

Afterwards, I expect companies will expect more home-working, and will save costs with hot-desking, which if you haven't experienced it is a peculiar mental torture. And we'll have more people FIREing, confident they won't miss the income or social aspects of work, and know what their priorities are.

[Snakey]

Investments/pension unsettled, although I only check it sporadically. £1.4m in mid-Jan to £1.2m at the start of April and today sitting at £1.3m.

My discretionary expenditure was very low anyway, so all I'm saving is a few quid on bus fares and haircuts which is dwarfed by the 20% cut in pay that my employer foisted on me plus the fact that my freelance fell off a cliff. Against the backdrop of gaining or losing £100k on the stock markets in the space of a week or two, this hardly seems to matter though.

That bigger picture helps put the timescales into perspective, too. Virus rules might keep my income lower for three or four or six months, but "so what?" when the stock market could stay low for three or four or six years (I don't need to touch it for at least seven). The potential return on investing even a reduced amount of money while prices are cheap outweighs the irritation of seeing my two-year early retirement plan go up in smoke. After chilling out at home for six weeks in perfect contentment I'm no longer sure that bridging the gap to pension access age would require burning through piles of cash in some kind of bucket-list frenzy, anyway.

Non-financially, you may recall my self-pitying vent at the start of the year when I really, really didn't want to go back after the Christmas break, having felt for a long time overworked and stressed and seeing only more of the same in my future. You can imagine the difference the sudden reduction in workload plus the enforced WFH has made. Add sunshine, warmth and more daylight and I'm feeling pretty good, and you can't put a price on that.

I think for those of us still in work and in our forties and fifties, the big risk has to be losing your job in a prolonged recession when you may struggle to find something else at the same level so that those vital final few years of high income aren't replaced with an enforced raid on your retirement savings. But it's not worth fretting over things beyond our control.

[TUK020]

Investments/pension unsettled, although I only check it sporadically. £1.4m in mid-Jan to £1.2m at the start of April and today sitting at £1.3m.

My discretionary expenditure was very low anyway, so all I'm saving is a few quid on bus fares and haircuts which is dwarfed by the 20% cut in pay that my employer foisted on me plus the fact that my freelance fell off a cliff. Against the backdrop of gaining or losing £100k on the stock markets in the space of a week or two, this hardly seems to matter though.

That bigger picture helps put the timescales into perspective, too. Virus rules might keep my income lower for three or four or six months, but "so what?" when the stock market could stay low for three or four or six years (I don't need to touch it for at least seven). The potential return on investing even a reduced amount of money while prices are cheap outweighs the irritation of seeing my two-year early retirement plan go up in smoke. After chilling out at home for six weeks in perfect contentment I'm no longer sure that bridging the gap to pension access age would require burning through piles of cash in some kind of bucket-list frenzy, anyway.

Non-financially, you may recall my self-pitying vent at the start of the year when I really, really didn't want to go back after the Christmas break, having felt for a long time overworked and stressed and seeing only more of the same in my future. You can imagine the difference the sudden reduction in workload plus the enforced WFH has made. Add sunshine, warmth and more daylight and I'm feeling pretty good, and you can't put a price on that.

I think for those of us still in work and in our forties and fifties, the big risk has to be losing your job in a prolonged recession when you may struggle to find something else at the same level so that those vital final few years of high income aren't replaced with an enforced raid on your retirement savings. But it's not worth fretting over things beyond our control.

Hi Snakey,
I have just re-read the "Talk me down" thread.
It didn't come across as self pitying, but hugely stressed out.
Sounds like you have made some major changes in perspective, and are in a much better place.
Well done!
tuk020