Early Retirement At 50 In The UK
Taking early retirement is a decision which requires a lot of considerations and planning. An early retirement often times leaves the retiree with a smaller pension and consequently a harder task adjusting to the cost of living. There are a number of good reasons why you can consider a early retirement. It could be because of your health; a need to change lifestyle or probably you do not like your job. These are valid reasons for considering early retirement. For whatever reason, you need to consider the pros and cons in order to make a good plan for your early retirement. You may also be looking at early retirement under 50.
Early retirement is not a decision to be taken as an afterthought, rather it takes years of planning and working towards having a healthy balance to fall back on. It should be noted that barring ill health, retiring at the age of 50 means a retiree may have to wait at least 5 years before he is able to access his pension pot. This is because the state pension age currently is set around the mid-60s, while most workplace pensions though varied, are set around 55. This makes early retirement a tough decision to make. Proper planning, however, can set an individual up comfortably to retire at age 50.
Considering The Pros And Cons Of Early Retirement
Retiring at an early age of 50 would give you more time to spend with his family, more time to travel the world, and an average of twenty years to spend in retirement. These benefits are however not easy to enjoy when you consider the fact that you have a pension which you can not access right away. This basically leaves you, the retiree to live on savings and the little retirement package which you get from your employers.
Also, retiring early means that you cease to receive regular salary and also enjoy company benefits which you did as a worker; such as having an official car and canteen tickets. These are changes which you need to prepare to adjust to.
Altogether, retirement at 50 would require a change in lifestyle of the retiree and careful planning on how to go about the process.
Planning for early retirement at 50
As an individual who wishes to retire early, you need to put your plans in place years before your retirement age. This is to ensure you have a favorable bank balance and assets to fall back on. There are some important steps to take in planning for an early retirement.
•Ensure To Save: As an individual who aims to retire early, you need to start to save early and regularly. This is to ensure that you have a sizeable amount of money to fall back on. Saving a regular amount of money over years will set up yield a sizable sum at retirement and ease the process.
•Investment: Investment is a good source of income and a very suitable one for an individual aiming to achieve early retirement at 50. It is necessary to properly scrutinize any business venture before investing, to avoid bad investments and losing your money. Real estate is a very profitable industry, and the new investment scheme of real estate crowdfunding is one that should be considered. Having a good investment would provide a source of steady income for an early retiree. It is very necessary to review your investments regularly in order to keep up to date with your proposed returns.
Early retirement at 50: What could you do?
•Lifestyle: Early retirement at 50 means you stop to earn a regular salary. This necessitates changing your lifestyle. The company benefits which you enjoyed as a worker, might have aided in maintaining a high standard of living. Becoming a retiree sees these benefits going away and it is easier to reduce that standard of living. You could move to a cheaper property or region, and also use less expensive cars, in order to reduce your cost of living, and save you more cash.
•Consider Phased Retirement: This involves easing yourself into retirement. This helps to ensure that you still have an income coming in, while you enjoy lower working hours and have less tax to pay. This gives you a trial run of retirement and helps you to come to an informed decision about retiring altogether.
•Consider Taking A Part Time Job: An early retirement at 50 leaves you with a few active years in view. As an early retiree, taking a part time job is a good idea. This helps to keep you busy for some part of the day while also bringing in some income. In taking a part time job, it is advisable to do something you have interest in. If you are a book lover, working in a bookstore would be a good idea.
•Contact A Financial Adviser: Before taking a final decision on your retirement, it is necessary to contact a financial adviser to properly discuss your options. A financial adviser is well placed to know if you have a good plan to sustain you, should you take an early retirement. A financial adviser can also be helpful in taking investment decisions and setting up a retirement plan. Contacting a financial adviser is the most important phase of your planning, which must not be overlooked.
These plans are highly essential to put in place for anyone considering an early retirement at 50. It is also needed to discuss with your employers about your plan to retire early and the feasibility of getting your pension early. Some companies can afford to give you, an early pension while others would not.
Altogether, before taking the final decision of an early retirement, you need to take your time to consider your resources and how you can cope with retirement. In the event, early retirement is not a plausible option, working a few more years can be considered. This is is why phased retirement is advisable, so as to ensure that the right decision is reached.
Early retirment or early retirement at 50: knowing your options
If you would like to look at your early retirement options then we can help you. Feel free to contact our ‘early retirement’ team to help you look at what you can and cannot do. We will put you in touch with a early retirement pension expert to help you look and discuss all of your pension options.