Have I Got Enough to Retire? How About You?
Here are my current plans
I spoke with my financial adviser last week. He had good news for me. He told me I now had enough money to retire. I was overjoyed to be in that position. I asked how much monthly income I could start withdrawing. He laughed. He said I had enough in my retirement funds to last me until next Thursday!
I’m only teasing you guys. I don’t have a financial adviser. I don’t trust them. Every one I’ve had has been more interested in making money for themselves than for me.
Yes, I know there are bound to be some great ones out there, but I don’t need one. I prefer to look after my own financial affairs. I will consult one if I need some very specific advice, but I’m the only person that really cares about what happens to my finances.
Anyway, enough of that. Let’s get on to my back-of-a-napkin retirement planning.
High-level retirement plan
Some friends don’t think I take planning my retirement seriously. They think I need to come up with a detailed and complex plans. That doesn’t work for me. If plans are too complex, they get too difficult to see what’s really going on. I also won’t end up following them.
I like simple, high-level plans. They’re way easier to both understand and follow.
My retirement income plan consists of having income from three main sources. Maybe I’ll add a 4th later.
- My UK state pension. At the moment the UK state pension pays out £185.15 a week if you qualify for the full amount. I need to pay to top up 3 missing years. Once that’s done, I’ll qualify for the full amount. I’m still a few years away from it, so it will be worth more when I do get it. In USD terms it will pay around $970 a month at today’s rates.
- My investments and savings. I plan to withdraw a maximum of 4% a year from these funds. They are currently mainly in cash, but I will soon start DCAing back into index funds. I also have some money invested in crypto, mainly Bitcoin and Ethereum. I can adjust the withdrawal depending on circumstances. As I plan to buy a house before I retire, I’m not sure what this 4% will work out as. I think a conservative estimate would be $1,300. It will hopefully be much more.
- Side hustle income. I can’t ever see a time when I won’t have a side income. At the moment I make around $1,000 a month from writing. I’m sure that I can increase my side hustle income to $3,000 to $10,000 a month over the next few years. It won’t be just from writing. I will start some other side hustles at some point. Maybe this year. Maybe next year.
All the above should give an absolute minimum income of $3,270 a month.
If I can get my side hustles to a place where they’re earning $3,000 a month, I’d have $5,270 a month, which sounds a lot better.
Ideally, I’d like my investment income to be $2,000 a month and my side hustle income to be $10,000 a month. That would get me closer to $13,000. I could live very nicely on that amount.
I think I’m starting to sound a little crazy right now. But it’s better to aim for a crazy target and fail than it is to aim for a safe target and succeed.
The investment and savings income depends on what property I buy. My general plan is to split my time between Asia and Europe. This gives me the best of both worlds.
But it leaves me in a bit of a conundrum when it comes to buying a property. I could buy two smaller properties so that I have a home in both places, but I’m not too fond of small places.
Or I could buy a bigger property in one place and rent in the other. That sounds like a waste because the home would be more expensive but empty for half the year.
Maybe the solution is to make more money.
I’ll have to work this out nearer the time. I don’t even know where I’d like to live at the moment. I will keep renting until I have a clearer idea.
That’s it, folks. Those are my high-level plans.
I’m kind of already there
But here’s the thing. I’ve already been living comfortably on my investment and side hustle income for many years. It’s working out just fine. Once I get my state pension it will be just like now, only better. I can’t see any flaws in my plan. Except for inflation. I need to keep a close eye on that.
Do you have any advice for me?
Do you think this is viable? Do you have any advice or suggestions for me?
Do you also have a retirement plan?