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Retire at 50 on £800k?

Chrysalis
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Re: Retire at 50 on £800k?

#145270

Postby Chrysalis » June 12th, 2018, 5:42 pm

Ah, in London. Not much use to me then :-)

Chrysalis
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Re: Retire at 50 on £800k?

#145273

Postby Chrysalis » June 12th, 2018, 5:44 pm

I see it covers rail fares as well...that’s quite a deal! I wonder why so out of line with what’s available elsewhere?

JohnB
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Re: Retire at 50 on £800k?

#145280

Postby JohnB » June 12th, 2018, 6:18 pm

I assume equity returns 3.0% dividends + 1% capital growth OVER inflation, less fees of 0.2%

Its very dangerous to look at returns and forget the inflation over the period. Always work in inflation adjusted figures, as they are much more meaningful, so here 3.8% return

Longtermyieldman
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Re: Retire at 50 on £800k?

#146979

Postby Longtermyieldman » June 20th, 2018, 7:25 pm

Living on capital sales is risky because you burn through it quickly in a downturn. Much better to live on the natural yield of dividend stocks or investment trusts. A yield of 5% net of tax is very high and risks requiring investment in assets that might not raise their payouts in line with inflation (and a household's actual inflation may be higher than the government's headline figure).

Close to state pension age, I might say risk it. At 50, no. I'd aim to increase the pot by at least a third. So either a later retirement or a higher saving ratio in the meantime (or both).


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