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Fire Plan - 2022

Including Financial Independence and Retiring Early (FIRE)
airbus330
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Re: Fire Plan - 2022

#333904

Postby airbus330 » August 17th, 2020, 4:34 pm

kempiejon wrote:You've burnt through 1 year of your reserve in less than a year? Have you been adding more cash to the market? Not drawing any of the income from the investments? I recon 3 years of expenditure could allow a halving of expected income taking 7 years to recover.


Not quite as simple as that. I was lucky that Statutory Redundancy and other bits off the government kept me going between September and December. During that time I drew down my 25% cash lumpsum on my small SIPP and added that to the semi HYP that I had been building up with the help of TLF. I'd been aiming for a 10k yr ISA income, 16k UFPLS from the big pension and 5k from cash savings until the state pension kicked in in 5 years time. The big pension was all in low cost global growth so took a hit in April. It then recovered a lot, so I moved about half into safer water, but of course that has hampered the portfolio growth, but as mentioned above, at least I could sleep at night. So, I'm now waiting until I have at least 4% portfolio growth before taking any drawdown. Also, I had planned on taking the ISA Hyp income in arrears, so I'm still waiting for that money to slowly build up in the account having been lucky to not have selected to many divi cancelers. So, my 30k income for 2020 has all had to come from the 3 year emergency funds I had put aside in BS accounts. Luckily, I was sitting on a lot of cash for various reasons when the market fell. So, had I been smart enough, I'd have shoved a load of new money in at the bottom of the drop and come out better off than I was in January. I was smart enough to spot the bottom, but not gutsy enough to take the risk. I have added some extra bits to the HYP at good prices, but my opinion, for what its worth, is that a further fall is likely. If it does happen, I am now positioned to take advantage and know what to buy. If it doesn't I'll steadily transfer some back to equity as we go along. The interesting thing was that I had a plan, I knew at some point I'd have to endure a big correction, but when it happened I couldn't just switch off the PC and come back in a years time as I had planned to do.

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Re: Fire Plan - 2022

#333907

Postby Darka » August 17th, 2020, 4:44 pm

JuanDB wrote:Congratulations Darka. Sounds like a simple and well thought out plan. KISS prevails.

I’m planning on 30th June 2022. 98 weeks (less 13 annual leave). Also not counting :D


I think this not counting is working out well :)

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Re: Fire Plan - 2022

#333909

Postby Darka » August 17th, 2020, 4:46 pm

xeny wrote:
Darka wrote:Salary sacrifice through work helps grow my SIPP further in the meantime.


I must confess this line intrigues me - how are you managing to get that to work? Most salary sacrifice arrangements I've seen only allow payments into the company scheme?


Apologies for the confusion xeny, you are right and my post wasn't clear.

My salary sacrifice is going into a private pension, when I retire from work I'll transfer that into the SIPP and buy some investment trusts with it.

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Re: Fire Plan - 2022

#333914

Postby kempiejon » August 17th, 2020, 5:03 pm

airbus330 wrote:
Not quite as simple as that...

The interesting thing was that I had a plan, I knew at some point I'd have to endure a big correction, but when it happened I couldn't just switch off the PC and come back in a years time as I had planned to do.


Thanks for the explanation, interesting. I can imagine acting similarly given the circumstances.

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Re: Fire Plan - 2022

#335482

Postby Joe45 » August 24th, 2020, 12:11 pm

I'm due to retire at the end of March 2021, but may bring it forward by 6 months.

My portfolio is 67% equities with the balance in bonds and cash. The cash element will be maintained at around 2 years' non-discretionary spend from which I will draw my spending needs. I'll sell investments twice a year to keep the cash topped up and at the same time to re-balance the portfolio.

The actual mechanics may require some refinement.

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Re: Fire Plan - 2022

#335494

Postby Adamski » August 24th, 2020, 1:04 pm

Think many are bringing forward early retirement plans, either voluntary or involuntary. It can be tough for many as the economy is near stand still. One thing would say is if want to re-enter job market not to leave it too long out, as more than a few months gap will be difficult to get a similar job. However if can afford it then why not. People have got used to working from home, or being furloughed, and returning full time to the office is not an attractive prospect. Plus I do think, although you lose out on salary and pension, you'll save on cost of commuting and other work associated costs, and can pull back spending if need to. Think it depends on your financial position, if strong then alls good. If a weak financial position probably serves working a while longer as if you're stuck at home, you may as well be in the office working and earning. Having said this, retirement is a very, very attractive prospect right now!!


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