It's a bit scary given the current economic state of things (and part time isn't really an option, nor would I want it in fact), so posting here for some views before I go for it. Hat tip to interesting posts from @the0ni0nking and @Greylocks who recently did similar, and to all who have offered great wisdom here over that time.
I'm aiming to resign in January, with my last day at the start of April. I'll be 57, married (wife is older, earning about £12-15K). Both of us in good health. One kid who just left university. No mortgage or debts. House in London worth about £700K. Full state pensions projected.
Based on a few years of bank/CC statements (and ignoring the COVID period), I'm aiming to cover outgoings of £37K p/a, made up of £25K "normal" spending and £12K for occasional extras (eg foreign travel, new kitchens, cars, etc.). Some years we'll spend more than £12K I'm sure, and some less.
Income will be primarily from dividends. About 70% from an ISA, the rest from a SIPP. About £28-30K as of this year but I'm assuming 15-20% less to be safe. Average TER 0.42%, platform fees about £500 p/a. Should be able to keep under the income tax threshold at least until state pensions come in.
I've allocated a £70K "cash bridge" to use until state pensions take over. We also have about 3 years of spending a cash buffer. The wife plans to keep working, and has about £150K split across an ISA and a SIPP roughly 70/30 bonds/gold (ETFs). We could use that to replenish said buffer if needed, and use it if costs start to ramp up towards the end.
I've toyed with the idea of buying an annuity with half of the investments. But I decided I'd like to keep the flexibility for now.
Overall I feel we've got a lot of cash going on. But then the aforesaid economic climate makes me feel a bit better about that so close to retirement at least.
Comments, as ever, are very welcome. Obligatory portfolio below.
G
ISA
20-share HYP | £179,124.34
Merchants Trust Plc | £94,746.75
City of London Investment Trust Plc | £92,309.17
iShares Physical Gold ETC | £55,233.60
Vanguard Global Aggt Bond ETF GBP H Inc | £34,277.76
SIPP
iShares MSCI World Small Cap UCITS USD (GBP) Acc | £87,193.92
VT RM Alternative Income Retail GBP Inc | £81,747.20
Vanguard FTSE Developed AsPac ex Japan USD | £68,501.40
iShares GBP Corp Bond Ex-Financial UCITS | £63,666.36
Vanguard S&P 500 UCITS ETF USD | £60,363.91
Murray International Trust | £47,798.85
L&G PMC Multi-Asset 3 (employer's pension) | £40,668.39 < -- plan to move to SIPP