One of the hardest things in retirement planning is trying to figure out what your number is. That is, how much will you need to live on in retirement. The best place to start figuring this out is to look at your current spending. If you aren't tracking it, start now.
I don't have a budget as such, but I do use YNAB so I can look back and see what I spent each month. I have my spending pretty much under control nowadays, so I am very aware if I am having a 'spendy' moment and am able to reign myself in very quickly. Currently I have all of my four children living with me, so some expenses are inflated, but this will change over the next five years or so.
I know exactly how much I spend now, but how might my expenses look during retirement?
Rent/Mortgage
I currently rent a four bedroom house from the local housing association. I have lived in this property since 2004. Due to the lengthy tenancy, my rent only increases by a minimal amount every year, and thus the amount I pay is around half what I would pay for a similar property if I rented from a private landlord. Even when all the children have left home, I would be mad to give this house up until I felt it was the time to jump ship.
I am saving for a house deposit, which I hope to use to buy a small property in France to retire to in 2028 when I turn 55. The plan is to purchase during the next couple of years, with a mortgage, and then use as a holiday home, while renovating and when I can finally access my pension, use the 25% tax free lump sum to clear the mortgage.
Cost now: £600 per month
Cost in retirement: £0
Utilities/Fuel
As there are five of us living in our home, despite being fairly frugal with our utilities, I still pay a fair amount toward this part of my budget. All utilities come to a total of £110.62 per month. During retirement, I expect this cost to drop significantly. My plans include a log burning stove and some form of solar system set up. As I will be living somewhere significantly warmer than the UK, plus only cooking and heating for a couple in a much smaller house, I expect to see at least a 50% drop in this area.
Cost now: £110 per month
Cost in retirement: £55 per month
Council Tax
One of the biggest bills UK residents face is the council tax. I pay around £130 per month. After researching the French equivalent it appears that unless you have your exact income and value of property, it is far too complicated to estimate, so I shall, for ease, assume it to be the same as now until I find out differently.
Cost now: £130 per month
Cost in retirement: £130 per month
Food
My current grocery spend hovers around the £400 per month mark. I expect this cost to gradually reduce over the next few years as the children leave home. I do expect to be able to buy a few nicer groceries occasionally, however, my heart lies with Lidl, so I don't see myself overspending in this category.
Cost now: £400 per month
Cost in retirement: £100 per month
Misc Costs that will reduce during retirement
I can think of loads of things that will reduce when I am not in full-time employment and not running a five person household; work clothes, normal clothes, petrol costs, food at work, convenience items, kids allowances to name just a few. Unfortunately with so many changes to come, it is almost impossible to gauge the extent of these savings this far out. I am expecting that I will own a small car in France and not the mammoth motorhome which I currently zip about in which should reduce some costs, annual habitation check for one! I also expect to pay no National Insurance, tax or pension payments.
Misc costs that will stay the same during retirement
I don't expect many changes to my regular expenses like mobile phone bill and internet service. I don't have a TV and have no plans to change that. I store all information and paperwork in the cloud, so have a monthly subscription to Evernote, which I expect to continue and of course Netflix. I expect to pay roughly the same for gifts, as I do now.
Misc Costs that will increase during retirement
As I will already be in Europe, I will be taking advantage of the train services that run all across the continent to access travel to other countries, while using cheap accommodation to see all the places I want to visit. I never have been a posh hotel type of person, and I don't expect I will change now. I like cheap travel, I love the thrill of getting a bargain but I do expect to travel much more when I retire, at least for the first ten years or so, thus an increase in this category will be very likely.
With just over ten years until I reach 55, there is a lot that could, and will change. By tracking my expenses now, I can plan for the future and course adjust as the situation changes.
15 November 2017
10 November 2017
Retirement Fund Update - October 2017
So I am better able to track my progress toward FIRE, I have decided to post an update of my retirement fund each month.
This fund is the sum total of my SIPP, Work Pension, Friendly Society Tax Exempt Savings and my S&S Isa, none of which I will be drawing from until my planned retirement. The target for these funds is £300,000, which is based on a retirement income of £12k per annum. I am saving separately for a house deposit and although that money is not part of my retirement fund, it will be instrumental in providing me eventually with a paid off house and therefore reducing the amount I need in retirement to £12,000 per year.
The aim is to keep throwing as much as I can into my retirement fund, with the biggest portion going to my SIPP, to take advantage of the tax relief. I am planning on being a non-tax payer in retirement.
Going forward, I will be tracking the totals of the above accounts, which hopefully will rise with growth and dividend reinvestment. I have input the last two months figures into google spreadsheets and come up with the handy little graph below:
| The long journey to financial freedom starts here! |
Although it doesn't exactly look very exciting right now, I am hoping that as the months go by, it will give an accurate picture of my journey towards financial freedom.
07 November 2017
October update and November goals
Autumn is well and truly upon us and being my favourite season of all, I have enjoyed getting out and about during October. Our trip to St Malo was wonderful and the weather in Brittany was very kind to us, I thoroughly enjoyed indulging in french food and making the most of our break away. I also spent a weekend in the van on my favourite local site, just myself and the dog during the first weekend of November. One of only a handful of campers on a very large site in the woods, at times it felt as if I was totally alone. Not for everyone I'd be the first to admit, however for me it was a blissful and totally relaxing experience, and as the heavens opened on the first night, it gave me the perfect opportunity to test out how water-tight the new skylights were. Result? Not a drop, which means I can now make a plan to start work on patching up the ceiling from the previous leak over the winter months.
Frivolous travel aside, how did my finances do this month?
Spending
As I knew I would be paying out for two weekends away, I reigned in all unnecessary spending to balance the books. The result was a pretty low spend month in total.
How much did I save in October?
Regular Saver - 500
ISA - 500
Property Moose - 50
Cash ISA - 100
P2P - 300
Total - 1450
Having said last month that I would not be saving anymore into my P2P lending, I did an abrupt 360 and changed my mind. There is no payment to my pension this month. It's taken a while to sort everything out with my new SIPP and get the new monthly payment direct debit set up, so my first payment will be going out in November.
Savings rate
For simplicity, I calculate my savings rate as a percentage of my net take home pay plus interest on bank accounts, royalties from kindle, bank bonuses (from switching to TSB this year), found money, cashback from Quidco, child benefit/tax credits, and income from any other source throughout the month. I do not add back in any pension contributions from my wages or tax relief, nor do I include growth on investments, dividends or P2P interest. I also ignore all matched betting winnings as I am still building my bank roll, I will start to include this once my total profit has reached £1000.
Savings rate as % of take home pay - 45.07%
This is the second month in a row that I have achieved a record breaking savings rate. Although my total savings were the same as last month, my income was less, so my savings rate was higher.
Matched betting income was again slow this month, due to working as much as I could and also being away part of the month and only concentrating on guaranteed profits. Not sure where I am going with this to be honest, I am finding it boring, and although it is free money, it is not passive and I can find better uses of my time.
Goals for the coming month
November will be a month of Fiscal Fasting for me. It is something I have done for a few years. During the month I try not to spend on anything unnecessary, and at the same time using up as much as I can from the fridge, freezer and cupboards to clear some space before Christmas and save some money. I have no plans for going out during the month, no trips away planned, but I do have lots of projects and stuff at home that wont cost a bean.
Reading - plenty of books on the shelf to get through
Sewing - I have made a start on the new cushions for the van, but still plenty to do
Baking - lots of ingredients to use to make goodies for the kids lunchboxes
Painting - need to finish painting the walls in the van and the hallway could do with a spruce up
Planning - need to work out the weekends I want to camp next year, plus some financial stuff too
Walking - need to hit that 10k steps a day to keep healthy during the long winter months
Gardening - not my favourite, but the lawns will need a final cut before the winter
Netflix - self explanatory. lots of good stuff on at this time of year
Christmas-ing - I will be making a list and checking it twice...
Thanks for reading!
Frivolous travel aside, how did my finances do this month?
Spending
As I knew I would be paying out for two weekends away, I reigned in all unnecessary spending to balance the books. The result was a pretty low spend month in total.
How much did I save in October?
Regular Saver - 500
ISA - 500
Property Moose - 50
Cash ISA - 100
P2P - 300
Total - 1450
Having said last month that I would not be saving anymore into my P2P lending, I did an abrupt 360 and changed my mind. There is no payment to my pension this month. It's taken a while to sort everything out with my new SIPP and get the new monthly payment direct debit set up, so my first payment will be going out in November.
Savings rate
For simplicity, I calculate my savings rate as a percentage of my net take home pay plus interest on bank accounts, royalties from kindle, bank bonuses (from switching to TSB this year), found money, cashback from Quidco, child benefit/tax credits, and income from any other source throughout the month. I do not add back in any pension contributions from my wages or tax relief, nor do I include growth on investments, dividends or P2P interest. I also ignore all matched betting winnings as I am still building my bank roll, I will start to include this once my total profit has reached £1000.
Savings rate as % of take home pay - 45.07%
This is the second month in a row that I have achieved a record breaking savings rate. Although my total savings were the same as last month, my income was less, so my savings rate was higher.
Matched betting income was again slow this month, due to working as much as I could and also being away part of the month and only concentrating on guaranteed profits. Not sure where I am going with this to be honest, I am finding it boring, and although it is free money, it is not passive and I can find better uses of my time.
Goals for the coming month
November will be a month of Fiscal Fasting for me. It is something I have done for a few years. During the month I try not to spend on anything unnecessary, and at the same time using up as much as I can from the fridge, freezer and cupboards to clear some space before Christmas and save some money. I have no plans for going out during the month, no trips away planned, but I do have lots of projects and stuff at home that wont cost a bean.
Reading - plenty of books on the shelf to get through
Sewing - I have made a start on the new cushions for the van, but still plenty to do
Baking - lots of ingredients to use to make goodies for the kids lunchboxes
Painting - need to finish painting the walls in the van and the hallway could do with a spruce up
Planning - need to work out the weekends I want to camp next year, plus some financial stuff too
Walking - need to hit that 10k steps a day to keep healthy during the long winter months
Gardening - not my favourite, but the lawns will need a final cut before the winter
Netflix - self explanatory. lots of good stuff on at this time of year
Christmas-ing - I will be making a list and checking it twice...
Thanks for reading!
06 October 2017
September update and October goals
Where has the last month gone?
Spending
No unusually high expenses this month, although I did spend a little on the van, and buy myself some new jeans. My biggest purchase was the new foam and material to make the new sofa cushions and the vinyl for the flooring, work still continues in earnest and I am hoping to have everything finished by the time she goes in for her MOT in April. I also bought my daughter a reconditioned camera this month, as she has just started her options and needed one for her photography class.
How much did I save this month?
Regular Saver - 500
ISA - 700
Property Moose - 50
Emergency Fund - 100
Pension - 100
Total - 1450 plus a little money left in bank account
I have now reached the maximum amount I wanted to save in P2P lending, from now on any extra savings will be diverted to my ISA. I have yet to decide whether to continue to reinvest the interest/principle repayments from funding circle, I am waiting for the new FC ISA to be released before I make my decision. If it doesn't happen this year, I will probably decided to slowly withdraw my money each month as repayments are made and divert to my ISA with Halifax.
Savings rate
For simplicity, I calculate my savings rate as a percentage of my net take home pay plus interest on bank accounts, royalties from kindle, bank bonuses (from switching to TSB this year), found money, cashback from Quidco, child benefit/tax credits, and income from any other source throughout the month. I do not add back in any pension contributions from my wages or tax relief, nor do I include growth on investments, dividends or P2P interest. I also ignore all matched betting winnings as I am still building my bank roll, I will start to include this once my total profit has reached £1000.
Savings rate as % of take home pay - 42.82%
This is the best month so far this year. I have really buckled down and chucked as much as I could towards savings.
Matched betting income was slow this month, due to working as much as I could and only concentrating on guaranteed profits only. Although I haven't reached my goal of £1000 yet, I am happy with the increase and my total profit so far stands at just over £860. I am now hoping to hit £1000 by end of December and start 2018 with anything over that being withdrawn and used as part of my budget for van costs.
Other news
My SIPP is now up and running and awaiting transfers in from my old pension accounts. I can see it when I login to my share-dealing account and am looking forward to when the money hits and I can make my bulk purchase.
Managed to get another trip away in September to my favourite 'weekender' site. Lovely time spent with my partner, my kids, and my best friend and her family.
I have booked some time off work during October, I am taking three days away with my partner to St Malo. On my return the van will be going in the garage for another three days for the skylights to be finished and some more work done from the list. I have also booked a solo weekend camping trip for the first weekend of November just myself and the dog. It will be a relaxing weekend of tea drinking, reading and long walks. I can't wait.
Goals for the coming month
I would like to see my match betting profits reach £900 by the end of October.
I will try and beat this months savings rate of 42.82%. This is going to be tough as I have a fair few expenses coming out this month, but I am going to give it my best shot.
I will be gearing up and planning ahead for a Fiscal Fast during November. I will be aiming to spend only on true essentials for the whole month, whilst incorporating a use up month and trying to get the freezers emptied before December. Hopefully this will see my savings rate increase for the month. October will be spend planning for this and seeing if I can find new ways to spend less and save more.
Spending
No unusually high expenses this month, although I did spend a little on the van, and buy myself some new jeans. My biggest purchase was the new foam and material to make the new sofa cushions and the vinyl for the flooring, work still continues in earnest and I am hoping to have everything finished by the time she goes in for her MOT in April. I also bought my daughter a reconditioned camera this month, as she has just started her options and needed one for her photography class.
How much did I save this month?
Regular Saver - 500
ISA - 700
Property Moose - 50
Emergency Fund - 100
Pension - 100
Total - 1450 plus a little money left in bank account
I have now reached the maximum amount I wanted to save in P2P lending, from now on any extra savings will be diverted to my ISA. I have yet to decide whether to continue to reinvest the interest/principle repayments from funding circle, I am waiting for the new FC ISA to be released before I make my decision. If it doesn't happen this year, I will probably decided to slowly withdraw my money each month as repayments are made and divert to my ISA with Halifax.
Savings rate
For simplicity, I calculate my savings rate as a percentage of my net take home pay plus interest on bank accounts, royalties from kindle, bank bonuses (from switching to TSB this year), found money, cashback from Quidco, child benefit/tax credits, and income from any other source throughout the month. I do not add back in any pension contributions from my wages or tax relief, nor do I include growth on investments, dividends or P2P interest. I also ignore all matched betting winnings as I am still building my bank roll, I will start to include this once my total profit has reached £1000.
Savings rate as % of take home pay - 42.82%
This is the best month so far this year. I have really buckled down and chucked as much as I could towards savings.
Matched betting income was slow this month, due to working as much as I could and only concentrating on guaranteed profits only. Although I haven't reached my goal of £1000 yet, I am happy with the increase and my total profit so far stands at just over £860. I am now hoping to hit £1000 by end of December and start 2018 with anything over that being withdrawn and used as part of my budget for van costs.
Other news
My SIPP is now up and running and awaiting transfers in from my old pension accounts. I can see it when I login to my share-dealing account and am looking forward to when the money hits and I can make my bulk purchase.
Managed to get another trip away in September to my favourite 'weekender' site. Lovely time spent with my partner, my kids, and my best friend and her family.
I have booked some time off work during October, I am taking three days away with my partner to St Malo. On my return the van will be going in the garage for another three days for the skylights to be finished and some more work done from the list. I have also booked a solo weekend camping trip for the first weekend of November just myself and the dog. It will be a relaxing weekend of tea drinking, reading and long walks. I can't wait.
Goals for the coming month
I would like to see my match betting profits reach £900 by the end of October.
I will try and beat this months savings rate of 42.82%. This is going to be tough as I have a fair few expenses coming out this month, but I am going to give it my best shot.
I will be gearing up and planning ahead for a Fiscal Fast during November. I will be aiming to spend only on true essentials for the whole month, whilst incorporating a use up month and trying to get the freezers emptied before December. Hopefully this will see my savings rate increase for the month. October will be spend planning for this and seeing if I can find new ways to spend less and save more.
19 September 2017
Pensions and other stories
I finally got round to printing and filling in the SIPP forms this week. This task had been sitting on my to-do list for a while and as usual I had applied my own particular brand of procrastination to it.
With the new auto enrolment pension rules, I had been opted in to a works pension in my previous job, where I stayed only a short period of time and have been left with a pension of about £23. I also have a Virgin Stakeholder Pension which I started a few years ago and have been regularly adding to. What I wanted to do was consolidate these two into a new pension, one that I would have better control over. I will also be continuing to add to this every month to the tune of £100.
I also have a third pension, newly opened for my current employment and as I intend on staying in this job long-term, I shall consider this to be my main pension and continue to enjoy the free money added to it by my employer and the government. The auto enrolment rules change from April 2018, when my contribution and also what my employer contributes will increase again.
After looking around, I decided to stick with Halifax and open a SIPP with them, this means I can see my SIPP and S&S ISA all in one place. They tell me the transfer will be fairly quick and should go through with no problems. I can then choose what to purchase with the funds in the account. The plan is to buy more VWRL which is what I currently hold within my ISA. Hopefully this exchange will be completed by the end of the month.
In other news, Bella Bird was back in the garage again this month, for some more upgrades. This time she had three new skylights fitted, although there was a bit of a problem with the third one, so she is going back in again next month so they can fabricate an extension to the locking mechanism. I also had some brake work completed, which wasn't urgent, but was on my very long list of things to get done and if they are going to have her in the garage for a few days, I like to have more than one job completed.
We are now almost 2/3 of the way through the month and I have done all my savings transfers for the month. I am pretty pleased with the total figure saved, and with how my expenses are looking so far for September. I have always found that paying myself first works far better than just saving what is leftover at the end of the month.
I have booked ten days off work in October, the first half I am away on a road trip with G. We haven't decided where we are going yet, but it will be on a campsite somewhere in England. The second half, which is half-term week, I shall spend having a lazy time with the kids while Bella Bird is booked in to go back to the garage for another three days.
I am off work today as we are having smart meters installed. I have wanted these for such a long time! We have no electric or gas for two hours which the change over is completed, but I am excited to see if having the new meters will make a change to my utility bills going forward.
05 September 2017
August update and September goals
Well, all the best laid plans etc...
Back in early July, I decided to part exchange my campervan and buy something bigger. The main reason for this was because I could no longer fit my youngest two constantly growing teens into the roof of the van anymore, plus as they are different sexes, they obviously no longer wanted to share such an enclosed space. After some hunting, I found the perfect 'home' for us. A 1990 Autohomes Travelhome. A four berth motorhome which saw me go back ten years in registration from my Bongo. I ended up paying £1000 on top of the value of the Bongo.
Throughout July and August I have been haemorrhaging money fixing her up and getting her to a good standard. I had a habitation check done, fixed various items within the 'house' part, repainted, laid new kitchen surface, had a complete service done, bought new accessories, including an awning, she now has a new (reconditioned) cooker installed, a full gas bottle and a new cam-belt and water pump. There is still a long list of things I want to do to her, but for now she is camp-ready. I have since taken her on three trips away and have loved every minute in Bella Bird.
The downside to all this splurging is that my cash savings took a big hit, plus I didn't save anything new in July or August. However, my savings rate will be back to normal for September and I have already paid my monthly amount to both Funding Circle and Property Moose for this month.
I also started match betting at the end of June and my profit so far is a touch under £800. Result.
Other big news is that after a small break between jobs while I was waiting for my DBS to arrive, I am now back working full-time as a carer and it is so nice to have that fortnightly wage back again (and a new works pension).
Goals for September:
Save my full planned amount this month. £1080 spread between P2P, S&S ISA, regular saver and my personal pension. Any leftovers will be swept into my ISA at the end of the month.
Hoping to reach the £1000 mark by the end of September in matched betting profits, which is my targeted 'bankroll'. Anything I earn over and above this will be withdrawn as a wage and directed into my motorhome fund to pay for all remaining work to be done on Bella. This way, my motorhome expenses will be funded purely by matched betting profits and not come from my wages.
Back in early July, I decided to part exchange my campervan and buy something bigger. The main reason for this was because I could no longer fit my youngest two constantly growing teens into the roof of the van anymore, plus as they are different sexes, they obviously no longer wanted to share such an enclosed space. After some hunting, I found the perfect 'home' for us. A 1990 Autohomes Travelhome. A four berth motorhome which saw me go back ten years in registration from my Bongo. I ended up paying £1000 on top of the value of the Bongo.
Throughout July and August I have been haemorrhaging money fixing her up and getting her to a good standard. I had a habitation check done, fixed various items within the 'house' part, repainted, laid new kitchen surface, had a complete service done, bought new accessories, including an awning, she now has a new (reconditioned) cooker installed, a full gas bottle and a new cam-belt and water pump. There is still a long list of things I want to do to her, but for now she is camp-ready. I have since taken her on three trips away and have loved every minute in Bella Bird.
 |
| Bella Bird |
The downside to all this splurging is that my cash savings took a big hit, plus I didn't save anything new in July or August. However, my savings rate will be back to normal for September and I have already paid my monthly amount to both Funding Circle and Property Moose for this month.
I also started match betting at the end of June and my profit so far is a touch under £800. Result.
Other big news is that after a small break between jobs while I was waiting for my DBS to arrive, I am now back working full-time as a carer and it is so nice to have that fortnightly wage back again (and a new works pension).
Goals for September:
Save my full planned amount this month. £1080 spread between P2P, S&S ISA, regular saver and my personal pension. Any leftovers will be swept into my ISA at the end of the month.
Hoping to reach the £1000 mark by the end of September in matched betting profits, which is my targeted 'bankroll'. Anything I earn over and above this will be withdrawn as a wage and directed into my motorhome fund to pay for all remaining work to be done on Bella. This way, my motorhome expenses will be funded purely by matched betting profits and not come from my wages.
19 June 2017
An introduction
I'm not sure what I am going to write on here, not yet anyway. I guess I just wanted somewhere to post my ramblings.
This is me: 44, Jamie, mother of four, dreamer, writer, campervan owner, with an insatiable need to travel full-time. Only I can't, not just yet. My oldest is now 21. My other children are growing up fast and I love them with all my heart, but I have had an urge to travel since before I found out I was pregnant with my oldest, and with four children, one with 24 hour a day care needs, I have had to put my dreams on hold for a while. I don't live with my other half G, but we plan to do that at some point in the near future.
Now I am getting to the point where the future is on the horizon, I can almost taste it. This year saw me return to work full-time after 21 years at home. My eldest now manages my house and takes care of his brother full-time, which has allowed me to go back to work.
Over the next few years there are big changes coming in our house. If all goes according to plan, my number two will be leaving to go off to university next September, and my number three will be taking up a place at a residential special needs school the same month, and then on to a specialist college two years later for three more years. For those five years, number three will return home on half-terms and school holidays, then when he leaves college, I will find him a placement locally, but he won't be returning to live with me again. At that point my youngest will be 19, and this mummy will be seeking adventure.
So, my dreams are this; I would love to live in a motorhome and travel around Europe. I am aiming for Financial Independence sometime around 55, earlier if I can manage it. I am currently saving over 35% of my income and am increasing this month after month. The target is to retire at 55 (11 years time) and live full-time in a motorhome, which would reduce the amount needed in my retirement pot.
This blog will document my journey. A little bit on financial independence, minimalism, travel, dreams, writing, money and other musings.
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