Don’t Fear the Reaper

I received a circular from Standard Life this morning in the email, offering advice on “How to pass on your pension to your loved ones”. This, I thought, was  a bit previous as I have no intention of dying anytime soon, although I grudgingly admit that at some point it may have to happen. Like Woody Allen, however, I don’t intend to be there when it does. 

One of the main tips in the article was to remember to regularly review your will. My wife and I made our first will about twenty five years ago when we took out a new mortgage. I think, at the time, that we giggled our way through it at the strangeness of it all, laughing in  the distant face of our assumed unlikely deaths. Oh to be young again. When we recently updated it, we weren’t quite so jocular and it seemed quite a serious exercise, simultaneously quite simple and complex as you work through various scenarios. These brought up the question of also making a Power of Attorney, which we resolved to do (and still haven’t.)

Another document we were handed to complete prepared you for things that you might like to happen upon your death – including such things as what music you’d like played at your funeral – in a Statement of Wishes. Filling that out is also still on the “To Do” list. It’s one of these things that you know you should focus some attention on but somehow find yourself not getting round to it. 

I also admit that I have very little knowledge on the financial side of the death equation. I’m aware of very general points of inheritance tax – such as that it exists – but have not looked in any detail whatsoever at the subject. I’m probably telling myself that I’ve got years, nay decades, to look into all of that. Another general thing I tend to think of is the scenario that I’ll go first, leave everything to my wife, and then she can sort it all out. (That actually happened to a friend who had his own business, with disastrous results.) 

I am aware of the importance of “putting your affairs in order” on a hypothetical basis at least, as I bet many of us are. Actually “putting our affairs in order”l takes a bit of work and might not seem the most appealing thing to do, but at some point will need to be done. It also seems obvious that this should happen while you’re still in sound mind to do it. It surprised me, when I sat down to review the contents of our first will, that we immediately wanted to change a few things in it. I had kind of assumed we’d just be rubber stamping things that we’d previously requested, but it didn’t turn out that way. There were no drastic changes, but the exercise caused us to think things through that, decades ago, had seemed straightforward. Bottom line was that over the years your circumstances change, but so do your attitudes toward them. 

In the end it’s the reality of the Grim Reaper that stands behind many of the decisions that we make today. For starters, at what point do you end your spreadsheet modelling for retirement? Does it just kind of fade away as you approach your nineties? Or have you had a stab at filling out one of those on-line calculators that give you an actuarial Estimated Departure Time? For me, it’s one of the big unanswerable questions that frustrates when trying to work out your pension plans – how long do you need your funds to last? Should you spend more in your Sixties than you plan to in your Eighties? The answer to that would seem an obvious “Yes”, leading to the next question of “How much more”?  It’s all very well planning to “Die With Zero” only to find that you actually have to “Live With Zero” because you got some assumptions wrong. (I’m sure that book tackled this issue and gave you some strategies for it. But, as I’ve mentioned, hypothesising is easy.)

And so, at last, I’ve managed to write a blog entry about Death! Only Sex to go, and I will have finally delivered on the promise of my title.

Stranded at the Drive In

I opened The Times yesterday morning to this photo and my heart fell. Was one of this timeless couple gone? Alas, it was true. Oh Sandy baby, some day, when high-igh school is done. Olivia was up there with Felicity Kendal in the nineteen eighties as the girl all the boys wanted. Well, us good, somewhat innocent boys anyway. It takes a few years under your belt before you start to suspect that you’d maybe prefer some time with Rizzo. Olivia was such a great choice for Sandy, but I can’t say the same for that goon Travolta. I thought, and still think, he was totally gormless in the role, and was so lucky that she was so perfect in hers that, as a couple, they worked. I have to wonder if Grease would be in my Top Ten films of All Time? It could be and maybe it should be, with its portrayal of the All American High School Dream, unrivalled until Marty McFly appeared at the Enchantment Under the Sea Dance in Back to the Future. Due to these movies, ask anyone in my generation which years and where we’d like to have lived through and many of us would probably say “Nineteen Fifties America”. 

What’s that got to do with Early Retirement, I don’t hear you ask? Well, not much really, I suppose, although I could try and hack out a link along the lines of “If I’d invested £100 a month in the year that Grease was released in a Global Index Fund, that sum would now total £112,000.” (That’s a guess, I haven’t done the maths.) 

Films can have such a big influence on us though. I think of portrayals of capitalism such as “Wall Street”, “It’s a Wonderful Life” and “Local Hero” and wonder about the cultural impact of them? Could you imagine a world in which the key scenes in Grease or Back to the Future are centred around young people gathering at the local bank to invest a small amount of cash each week, instead of squandering it on yet another strawberry milkshake? It would certainly have more influence than the stupid banking adverts we see of black stallions galloping down your local high street. I have noticed that Vanguard has been advertising on TV recently, but have to admit that, other than noticing it, I couldn’t tell you one message or scene that the advert contained. Maybe they should have gone with a white horse?

On the other hand, maybe I should just be heartened that Vanguard is actually now able to advertise, regardless of how hopeless they’ve been about getting their message across. I count myself really lucky that I discovered Index investing almost thirty years ago, because I still reckon nine out of ten people I know have no idea what Index tracking funds are. In fact, the majority of our best friends, incredible as it is to write this, hold most of their life savings in cash. As for what their pensions are invested in and how much they are being charged for the service, well, answers on a postcard please.

I could also use the reflection on time going by to moan that in the Nineteen Eighties there was no information for young people like myself on the glories of compound investing. Or actually on anything to do with the stock market. I read J L Collins, who started his investing career in the Eighties, and think to myself where was I and what was I doing with my time and money at that point? Those were the most important years for saving! Why was I squandering my cash on going to watch popcorn films like Grease? 

Well, I’m glad I went to see Grease instead of saving the cash. Iconic films of your youth remind me there’s a lot more to life than money and that the years go quickly by. I also won’t try to justify the post on the basis that this subject could be relevant to at least three of the four words of my blog title. That feels just too crass. But I have written a few draft posts trying to find something worthwhile to say about “gathering rosebuds while you may”, because I do feel myself thinking that a lot more in retirement. With that in mind, maybe it’s time to go and watch Grease again.

Large Fries With That?

I was listening to a Sam Harris podcast the other day, when one of his guests said something along these lines. “There’s a global demographic bomb about to hit us. There are far too many old people retiring and they add nothing to society. Retirees don’t spend money, they save it, which depresses the economy. They invest conservatively and eschew risky business of any sort when it comes to their money. They add no value to the economy and become an increasing health burden as they age, putting pressure on this resource.”

Harsh, I felt, but was it fair? I often wonder now if I’m pulling my weight for society? Forget the fact that I contributed for a long time in my career. So did many other people, but I like to think that I did my bit to fund the community that we all enjoy living in. But what now? I’m exactly the problem that the podcast guest outlined. I’m increasingly careful when I spend my money, and a cafe charging more than £3 for a cappuccino doesn’t usually get my business. Bannatynes gym, selling four fingered KitKats for a pound a time, can forget it when I can get a pack of four of these for the same price in Farmfoods and sneak them in via my gym bag. 

The days when I was speculating in single company stocks have long gone. I once blew five grand on shares in a dotcom business that plunged in value a month after I bought it, and I held on bitterly until the bankrupt end. These days I sweat like Rikki Sunak trying to explain how much tax he’s paid when I contemplate the money I hold in my Vanguard 80/20 account. It’s only the fact that I don’t really understand the bond market that deters me from switching to a 60/40 or 40/60 account. Ironically, I’m now so cautious about change that I seem to be stuck in a “riskier” investment. 

I laughed as I read Mr Money Moustache’s recent post about people suffering from the “Just One More Year” syndrome at work. They’re terrified of not having enough put away for retirement and therefore work on to squeeze “just another year’s” income out of their career. And then they do the same again the following year. Pah. Wait until they do retire and simply replace that syndrome with the retirees lament: “Wait One More Year”. This is where the big holiday to Australia can wait until next year. As can the new car. As can the new kitchen. As can the new shoes. And socks. And so on, until 10 years have past and you still haven’t seen the Sydney Opera House.

So if I’m not contributing and not spending, am I becoming a burden to society? I’ve blogged about my efforts and intention to grow old as healthily as I can. Probably every retiree in good health has the same ambition/fantasy. But the last time I visited the doctor, he wondered if maybe now would be a good time for me to begin taking statins? For the rest of my life. How much would that cost, I wondered? Well, nothing to me, thanks to the NHS. I declined, but I asked myself at what point should I start taking them as a precautionary measure? After all, they’ll not cost ME anything, so what’s to lose? Maybe only the NHS as it grows overburdened by things like this – there’s a big notice in my local hospital pleading with people to buy their own paracetamol (29p a pack in Asda) because, last year, they spent over £600k prescribing it. 

Retiring at 57 I do believe I may be one of a blessed generation, if only because of the fact that younger people seem prepared to tolerate my indulgence. It is an indulgence. A luxury. I’m just a posh layabout, maximising tax breaks, working the system and goofing off. I really don’t like this notion and I often find myself thinking that I CAN be working and therefore I SHOULD be working, because that’s what makes the world go round.

I wonder what life would be like if we had a culture change where working into your eighties became the virtuous and most valuable thing you can do in your old age? I wouldn’t say this notion is frowned upon, but it seems to me that people who work into their late sixties and seventies or even eighties – like President Biden – are seen as being a bit odd. Or broke. Or a bit sad in that they clearly can’t find anything better to do. 

I keep reading that there’s a labour shortage in this country at the moment and that this is exacerbated by a lot of people who have taken early retirement. Perhaps someone could join those dots and encourage us (not so) oldies back into the workplace? While I wouldn’t fancy an eight hour shift behind a bar or making coffees, a four hour shift a couple of days a week would be a lot more appealing. I wouldn’t want, and really don’t need, the uncertainty of a zero hours contract, but I wonder if there was an alternative model that might tempt us back into the types of service jobs that seem to be so short of people right now? 

A couple of years ago on holiday in America, I noticed that there were quite a lot of older waiters and waitresses working in various restaurants we visited. At one point, in a McDonalds, I was served by an old bloke in his seventies. I think seeing that here would be quite unusual.  I’m sure there are lots of ways we could tempt people out of premature retirement with the right incentives, but I feel we need to have more positive examples out there in everyday life to show us what’s possible. I hate to think that retirees are just a drain on society and the economy, as Sam Harris’s guest seemed to think. Given that we’re increasingly here to stay, let’s think more about what we can do to continue to make a positive contribution to our communities. “Help the aged”, sang Jarvis Cocker, “One time they were just like you.” No, Jarvis, it’s we who were just like you, so how can WE help YOU?

Death, Health, Money, Sex

One of the encouraging things about blogging – when you’re not telling yourself that everything you write is actually a waste of time – is the positive feedback and interesting views you get from the Comments. When I stopped blogging, that’s what I missed. These days I spend more time reading comments on other websites too, including on the BBC News website (when they allow them) or on the online versions of the newspapers. That’s where the interesting opinions are.

My blog tends to divide opinion between those who love and embrace retirement wholeheartedly (or think they will) and don’t miss work at all and those, like me, who find themselves pining for some elements of the working life. As I read through some of the feedback recently, I found myself asking the question “Would I go back to work if an attractive proposition came along?” and I honestly felt that I might. 

Okay, so what? It’s no big deal and it’s not a sin to miss working, I don’t suppose. But, on the other hand, going back to work, for me, this time round would seem much more like a really wasted opportunity. When I decided to “commit myself to retirement” last March, the biggest question I was trying to force myself to answer was “If not now, when?” I was well aware of the cliche that nobody ever lay on their deathbed ruefully exclaiming “I wish I’d spent more time at the office”, but cliches are cliches because they have a fundamental truth to them. I was also aware that the title of my blog could be rearranged to reflect my mental priorities as I moved through the decades. In my twenties and thirties the focus and title would have been “Sex, Money, Health, Death”. In the forties, it felt more like “Money, Sex, Health, Death”. In my fifties, it began to shape up as “Health, Sex, Death, Money”, and my sixties seems to be heading more toward “Health, Death, Sex, Money”. Eventually, if I reach my nineties it might well be Death, Health, Money, Sex. Such is the ageing process. 

It didn’t help – or maybe it did – that last March I’d been spending time at the local hospital being checked out for something that I’d reported as chest pains, or at the least, what to me felt like severe heartburn. To be fair to the NHS, they put me through some rigorous testing and fortunately couldn’t find anything seriously wrong. But, as you lie under the MRI scanner, it cannot help but strike you that your days of taking health for granted are under threat. Could you imagine dropping dead at your desk in the office after being bollocked by some jumped up “senior manager” because your Powerpoint presentation was in the wrong font? Is that what life’s about? Aged 57, and taking advice from doctors and nurses who seem to look younger than your own kid, well, it makes you think. Or it made me think it was at least time to stop and smell the flowers, especially given I was in the fortunate position to be able to do so.

One of the luxuries of being retired is having the opportunity to stay healthy in a way that doesn’t feel like a grind. When I went back to a desk the last time I couldn’t believe the physical toll it took on me. I went from averaging 10,000 steps a day (without trying) to averaging 3,000. After sitting in front of a screen for eight hours, my body ached, I’d no notion of reading anything and the thought of heading to the gym was about as welcome as a dose of Covid. Working (or at least white collar, middle management working) is bad for your health. It’s one of the biggest reasons I’m not actively seeking employment right now. I tend to think of fitness now in the way I once used to think about investing, namely “This will do me good further down the line”. Most days, I see it a bit like shaving – I don’t like doing it, particularly, but I feel so much fresher after it and it sets me up for the next few hours with a positive mindset. 

For any readers who are struggling to take up some sort of fitness activity, I’d quote one of my favourite Chinese proverbs – “The best time to plant a tree was twenty years ago. The second best time is now.” Excluding the financial side of retirement, and maybe even including it, being fit in my old age is currently my absolute priority. No doubt I’ll be blogging in future about habits, routines and structure, in terms of what works for me and what doesn’t, but the habit of exercise is one I find difficult to argue with.

Back to the Future

I’m often motivated by Monevator, and the people who comment on the posts, and lately I was nudged to update this long dormant blog. I’d also been notified by WordPress that it was time to pay up for another year or close up permanently, so I chose the former. Having paid for it, I might as well use it. 

Just to recap, I originally started this blog when I retired at the (not quite so) early age of fifty-one and discovered that FIRE wasn’t exactly what I’d hoped it would be. I liked the FI part, but wasn’t so keen on how I was finding Retiring Early. In a nutshell, it certainly wasn’t worse than working, but on many days it certainly wasn’t any better either. Meanwhile the relentless optimism of many of the American FIRE bloggers began to rankle versus my experience and I thought I could write about how I was finding it difficult to reconcile the dream versus the reality.

To cut a long story short I eventually decided to go back to paid employment because I missed it. I found a job and stayed in it for the best part of the next six years. I would still be there had I not been made redundant in March last year. Given that I was now 57, given that my wife was retiring and given that I was even better placed financially than I was before, I decided that maybe retirement was worth another go. 

At that point I thought I might go back to blogging as a more committed retiree, but I still wasn’t sure that I actually was retired (and am still not!) What did I have to say though? Was FIRE still a thing? Could I credibly write about it if it was? On the other hand, was writing about “real” retirement something I, or anyone else, would be interested in writing and  reading? 

Resultantly I decided to give myself a bit more time to form any further opinions about full time retirement. As the months go by though, there’s no doubt that it’s still a curate’s egg. It’s like the opinion I eventually formed about “work life balance”. There’s no such thing, really, it’s all just “life”. It’s the same when you try to compare working life versus retirement – they’re both just “life” and what you do with it is essentially up to you.

On the other hand, I do find myself thinking that this retirement life does require you to stretch yourself a bit in different ways to what you did at work.. It requires more “self starting” as there’s nobody pushing you to do anything with your days.  You still need structure but you have to provide it for yourself. It’s almost like a job where you need to figure out priorities, goals and objectives for the days and weeks (which is a lot better than some idiot boss deciding them for you!) Then you have to work at them, commit to taking action and find things which are the right side of enjoyable. Just like at the office, some days you need to graft, some days you can coast and the more you can pepper your days with coffee breaks with friends and colleagues, the better!

One of the main observations about retirement that I read somewhere, and that has stuck with me, is that you need to actually try new things. It’s not enough to think, “I might join that stretching class at the gym.” You actually have to go and do it (and it’s so easy not to!) Even more awkward, you might have to arrange something yourself – start a book club, or an investment club, or a walking group and invite like minded people. This way lies rejection, so it’s much easier to wish that someone else would present you with things to do and meetings to attend, just like management does in your career. I used to like to think I was one of those “self starters” at work. Retirement has definitely challenged me to demonstrate that this is true. The stretching class at the gym – which I have attended – is generally full of older women. Very few men go along. Perhaps this is because it’s somewhat embarrassing to try and bend into a pose and hear your fellow attendees, or yourself, fart for England. Honestly, I’d much rather be in a class of blokes. So why don’t I start one? 

Having to work at retirement is maybe not a revelation to many people but I’d say that it has been an increasing revelation to me. Much as I’d love someone to fill my day with stuff that I like to do, it ain’t going to happen. It’s up to me. I certainly didn’t want to moan about retirement in a blog, but maybe I could share some of the challenges and what positive things I have found to come from them. Off the top of my head, in the last year I’ve learned loads about pensions and developed a hard-won withdrawal strategy that I’m finally comfortable with; I’m way fitter than I’ve ever been; I’ve massively expanded my cooking repertoire; I’ve discovered Youtube DIY videos and saved hundreds of pounds in repair costs; I’ve learned a bit about gardening; I’ve read more books than I ever have; I’ve worked hard to increase my social circle; in any given week I average 15,000 steps a day, double what I used to do when working; I make time for audiobooks and podcasts; my golf handicap….nah, you don’t want to know about that. I’m busy enough and not often bored, but another revelation is that the amount of time you have to do things in full-time retirement is incredible. When you hear people say they don’t know how they managed to fit everything in around a working life, I think that’s a reflection of suddenly realising how much time you have to fill when you’re not working eight hours a day, five days a week. It really is a luxury that you come to appreciate. But, like I say, I needed to, and still need to, work quite hard at appreciating it! 

Given this amount of time available, going back to blogging is now something I can do, so I’m going to give it a go. I’m not sure what I’ll write about, but given I never actually wrote much about “Sex, Health, Money, Death” the first time around, perhaps this time I can widen the scope! As I’ve just written, it’s actually doing something and taking action that counts…..

Changed Days

My son started work this time last year and, on his first day, I gave him the best advice for that event that I could: “Remember to sign up for the company pension!”

Of course, he didn’t need that advice because he’d have been automatically enrolled these days and would have had to register to come out of his company pension scheme, as opposed to physically signing up to joining it as I once had to. Doing so was one of the most important financial decisions of my life, not that I was aware of it at the time. I’d be lying now if I said I could remember signing on the bottom line that took me into the company Defined Benefit scheme, I’m just ever so glad I did. I don’t think I ever missed the money either, not even thinking about the subject until about ten years later when I started to become interested in investing for the future. Even then, I took the pension scheme for granted. After all, surely everyone was enrolled in some sort of scheme?

I read in the paper this morning, however:

A 25-year-old starting work in the private sector would have to put almost a third of their salary into a workplace pension to match the retirement benefits of a colleague embarking on a career in the public sector, according to a report by the Taxpayers’ Alliance, the low-tax campaigners.

Never mind the public vs private sector debate (if you can). What shocked me was that a twenty five year old would need to invest a third of their salary to get a decent equivalent of a “defined benefit” pension on retirement. It just highlights what a loss to the average employee the demise of those DB schemes has been. Not that they’ll probably notice, or miss, something that they never had. But it certainly makes me think that your fresh faced employee joining the workplace today has a tougher financial future ahead than I ever did. To be honest, if I had been told that signing up to the company pension scheme that I joined in the Eighties would cost me a third of my salary, I doubt I’d have joined. But my contribution was nowhere near that.

A few other things that have gone since those heady Thatcherite days when I joined the working population: firstly, the company car I was given was a total perk, hardly cost anything on tax and was way, way better than having to buy your own car. That’s not the case now – I opted out the last company car scheme I was offered due to the tax burden on it.

Secondly, my starting salary of £7k a year meant I could get a mortgage of £23k, enough to buy a small flat in my home town and get on the property ladder with a ten percent deposit. That’s almost laughable these days and has me wondering if I’ve got my facts right – but I know I have.

Thirdly, if I wanted something like a new TV for my flat, I had to sign up to a Hire Purchase agreement or save up the money. I was about three years into employment before I signed up for an Access Mastercard (Your Flexible Friend) which changed how just about everyone thought about getting into debt. Something that was almost shameful to my parent’s generation became almost fashionable and cool – paying for dinner with a credit card let you almost imagine you were Gordon Gekko from “Wall Street”, or Bud Fox at least. Surely that slinky mobile ‘phone wasn’t far away either?


I smile at those recollections now, but many of my early financial decisions I made happened without me thinking too much about them. Generally speaking, however, the basic things I assumed in those days were both sensible and achievable – pensions were a good thing, you should try to get on the property ladder early and you should be wary of debt. And, generally speaking, those rules are still sensible today. It just seems that for my son’s generation, they’re a lot less achievable.

Tench Detecting

As I approach the finishing line of official retirement – I turn 55 in November and can start to drawdown my pension, if I choose to do it – I spend time wondering what will make my leaving the workplace different the second time around? I recently listened to The Mad Fientist relate his “struggle” to come to terms with Early Retirement in his first year of doing so, and how he found his second year much more pleasurable and liveable than his first. I wondered, for about the thousandth time, if that had been my problem with my own “early retirement” – I was never really mentally committed to it, never really believed it was a realistic option for me when I was still able, and quite willing, to work.

One example of this – a friend of mine in his early fifties who recently retired spends about three of his afternoons a week playing golf with members at our local club. Despite having that option in my year off, I never “allowed” myself to take it up. Why? Basically because I believed that wasn’t the retirement lifestyle I wanted, although I became hard pushed to define what that lifestyle would be. All I could say was that I wanted retirement to bring more fulfilment than I’d find spending endless hours on the fairways with a bunch of old blokes.

These days I find myself looking for something, a hobby or pastime, that I could do in future retirement that might constructively fill my hours. Recently I’ve been watching on TV two old blokes struggle to come to terms with their own semi-retirement and mortality on the BBC’s iplayer. Paul Whitehouse and Bob Mortimer have “Gone Fishing” in an effort to come to terms with the ageing process, Life, the Universe and Everything. The best thing about this programme, by a long way, is the camera work – it’s beautifully done, and England looks like Paradise. It’s educational too, at least for me. In the first programme they fish for tench. Tench? Would I even have know that was an English freshwater fish prior to this programme? And it’s inspirational. I watch the scenery, the skill involved in the fishing, the knowledge needed and applied, the camaraderie of the fishermen and I think, “I’d quite like to have a go at that, when I’ve got the time.”

Another TV show that’s very similar in style to Gone Fishing (and possibly inspired it) has become one of My Favourite Programmes of All Time. It’s the Detectorists, and it’s difficult for me to say why it appeals to me so much. Again it’s the scenery, the camaraderie, the knowledge required that underpins the hobby, the leisurely and reflective pace of the stories and the warmth, humour and humanity that exists between the main players. It leaves me thinking “But I want to be a Detectorist!” , even although I probably don’t. But I do want to do something that delivers the fulfilment, learning, community and satisfaction of the type that these shows suggest is attainable.

I’d have to say that golf does deliver some of what I’m seeking, and I’m happy with that. I couldn’t play it three times a week though because (a) it’s the most difficult, frustrating game ever invented and (b) it can be mentally and physically tiring. It can be quite a slog and, when you’re not in the mood, it does live up to the description of being basically “a good walk spoiled”. 

At the moment, I golf on a Saturday morning and Wednesday evening, looking forward to both outings. One thing I learned in my year off is that routine and structure are ultra-important to have in your days and weeks. The Fientist underlines this point too. However, you need variety too or your days can become quite stale quite quickly. If you’ve come from a highly stimulating workplace, as I did, to face endless days with nothing to do, it’s important to have mental challenges too – four hours a day in the gym really won’t cut it, mentally, no matter how many games of treadmill suduko you attempt to complete.

Retirement, early or otherwise, is often looked at for a primarily financially perspective. Can you afford it? If the answer is “yes”, good on you, start planning for what you’re going to do with your time and start investigating and participating in those hobbies before you reach the stage when you have real time to indulge them. That’s easy to say, of course, so the next question for me is: Will I now head to Amazon with the search terms “Course fishing” and “metal detectors” at the top of the list?


Heigh ho, Heigh Ho

I’ve been back from my holiday a few weeks now and am struggling a bit to get back to a routine, and that includes posting on my blog. You know how it is after holidays though, especially ones you’ve really enjoyed. You ask yourself why life can’t be like that all the time and immediately start planning the next trip.

Of course, if you’re in the fortunate position of being able to retire from the workplace with a decent income then maybe life could be like that all the time. I know the first three months of my bout of “Early Retirement” felt just like that, every day had that “holiday feeling”. I’d watch others heading to work with a glow of inner satisfaction that I was no longer on that hamster wheel and that I was on a different path.

The holiday feeling didn’t last. Soon I went from humming Madonna’s “Holiday” to Morrisey’s “Every Day is Like Sunday” as I found each day the same as the last. I began to think that what made holidays special was that they were a break from work. If you weren’t working, they lost their sheen. It was the same with weekends. Whereas once I craved reaching a Friday evening with a whole weekend of relaxation ahead of me, Saturday and Sunday became just another couple of days – although there were more people available to share them with you.

That was one of the things about my weekday retirement – finding people in a similar age and situation to myself to share the days with. Most of my friends and peers continued to work and seemed to be quite enjoying themselves doing so. Even my wife wanted to maintain her part time job (probably to ensure she got a break from me!) and, while I’m quite comfortable in my own company, I’m a long way from being a loner. I enjoy social stimulation, interacting with other people and, for almost thirty years, the workplace had provided me with that.

In the end I returned to work, partly to provide that “social stimulation” I was missing. When I came back from holiday a fortnight ago, I really wasn’t looking forward to returning to the actual work that I do – but I was looking forward to catching up with the people there, both my co-workers and my customers. In fact, it’s the people that keep me going, because the work itself is fairly routine and not too demanding on a day to day basis.

It would, however, be remiss of me not to mention the financial side of working too, something that just can’t and shouldn’t be ignored. When I stopped earning an income and began to rely on my savings and investments to cover the bills, I struggled to get comfortable with the situation. Although all my spreadsheets and projections told me I’d probably not much to worry about, I couldn’t shake the notion that I’d feel a wee bit better if I started cleaning windows on the side – just to put some cream on the cake. Even if I only earned a hundred quid a week, well, that would pay for a damn nice holiday or two, wouldn’t it? Plus, if I was to blow five thousand pounds on holidays purely from my savings and investments, would the resultant hole fill itself in?

When you’ve spent most of your life saving money for retirement, the switch to spending money to fund that retirement takes a massive shift of the mental gears. Maybe, over time, I’d have coped better with the no income side of not working, but I admit that in the year I had out I did struggle with this.

This year, as I approach pensionable age and ask myself the question if I want to give retirement another go (imagine, a permanent holiday!) I remind myself of the above realities as they were for me. What has changed since then? Not a lot. In that case, I tell myself, start planning the next big road trip to the States, or wherever, and let the work pay for it. That still feels like the best bet for me.

Born in the USA

We’re on our annual holiday to the U.S. (arguably the home of FIRE) doing a road trip of the Western states. We’ve currently stopped in Scottsdale, Arizona, which is essentially one massive shopping mall and seems to offer a pretty pleasant lifestyle – if you have the cash. And, from what we can see, there’s a lot of it about, judging by the Porches, Bentleys, Ferraris and Range Rovers being driven around. A lot of them are driven by pensioners too, which made me wonder what the average pension income is like over here for the “average” American? A quick search on Google brought up this:

Avg US Pension

You have to say that this looks quite good – a median income of $47k, or almost £35k a year for those households aged between 65-74. From the article, it looks as if the State Pension part is somewhere around $12,000 a year, not dissimilar to what we receive in the UK, and the rest will be coming, I assume, from private pensions, employment and investments. (as an observation, there do seem to be a lot of older workers here, in department stores, restaurants and the like.)

The next big question – here in America – will be how much is your medical insurance out of that? At this point, I’ll stop the comparisons because there are far too many differentials to take into account in comparing the US and UK, but given that the US possibly inspired FIRE, I thought it was worth a look see.

In my Google search though, I found that the definitive report on comparing pensions worldwide is done by an Australian consultancy – Mercer – and they came up with this ranking of countries in 2016.

pension ranking

I’m not a big fan of data, really, in the sense that I see it as “the drunk holding onto the lamppost” – it’s used more for support than illumination. Choose your argument and then pick the data that shores it up. Singapore scores highly, but I wouldn’t want to retire there, thanks very much. Too crowded, too hot, too controlled, too far away. I’d be sitting in Raffles Bar, pining for home and a decent pint in decent pub, which is what I was doing years ago when I visited the place.

All the same, it’s an interesting analysis and at the very least it’s good to know that someone is taking a serious look at this as society grows older (I’d read recently that Japan is doing some pioneering work on the pension funding issue with reference to its ageing population, but it doesn’t score well here.)

I should read the whole report I suppose, but Ye Gods I’m on holiday! Plus I’ve already decided that I’m not going to retire abroad, one of the subjects frequently up for debate in FIRE discussions. No doubt I’d have a great standard of living in Panama or the Philippines but so what? You’d never be a local, you’d always be an “ex pat” along with the rest of them, an outsider wondering when and if you’d ever feel fully settled in an adopted homeland later in life.

Having longtime friends, family and a community that you’re settled in is supposed to be worth its weight in gold in retirement and I suspect there’s a lot of truth in that. Britain’s not perfect, but it’s home and it’s funny how much I miss it when I’m away. As I sit here writing this, incessant American news coverage of the Royal Wedding drones on in the background, but even that can’t spoil some of the scenery being broadcast of Windsor and England in the sunshine. “That lot won’t have to worry much about their pensions”, I muse to my wife, who rolls her eyes and tells me to go and get a beer. 

Good idea.

Unsafe Withdrawal Rate

I was writing last week that I had been listening to the Dave Ramsey podcast which, I guess, would be an acquired taste for most UK listeners or a taste that they’d rather not acquire. But I like his straightforward bluntness and bluster that disguises an essentially decent bloke underneath.

Anyway, while listening to one show last week, a middle American called in wondering how he should figure out a Safe Withdrawal Rate on his pension.

“Where have you the money invested?”, barked Dave.

“Well, gee whiz, I guess mostly in mutual funds Dave…”

“And what have they returned since you’ve been invested”.


“You don’t know? You don’t know how your money has grown? I know how my funds have performed for the last twenty, thirty, forty years”, and Dave proceeded to quote the numbers.

Suitably chastised, the caller mumbled, “Well, I reckon maybe ten or twelve percent Dave’.

“Okay”, thundered Dave, “I doubt that. But let’s say it’s ten percent. And you’ve half a million invested. How much can you safely withdraw? Per year? How much? You’ve been returning 10 percent on five hundred thousand, how much can you withdraw without eroding that capital”?

“Reckon it should be fifty thousand a year Dave”.

“Exactly”, snapped Dave, and cut him off.

So there you have it. That’s how Dave calculates a Safe Withdrawal Rate – and I like it. Of course, this is full of holes even for those of us who aren’t mathematicians, but I’m sure Dave would take a sledgehammer to the naysayers. I’m sure he’d argue: “Right, your fund has returned 10%, on average, for the last twenty years. It’s a good bet that it will probably continue with this. Okay, some years it will return 1%, or lose money, and some years it will return 40% or 50% but who gives a damn about the detail? The 10%, over time, is what it’s returning. End of discussion.”

Dave often takes a sledgehammer to crack a nut. You know that he knows the devil is in the detail, but he’s little time for nit picking on it and likes the big sweeping statement that contains an essential truth. Keep It Simple Stupid, is his mantra.

Is he wrong, I wondered? Yes, of course, nobody can predict the future, and a fund that has returned 10% growth for twenty years could turn tomorrow to produce a loss for the next twenty. And tomorrow I could get run over by a bus, driven by Dave Ramsey. These things could happen. But what are the chances? That’s what you’ve got to try and figure out – and that’s the frustration, and possibly the attraction, of investing.

I’ve listened and read the endless discussions about timing the market, about the bloke who started saving his money in 1994 versus the bloke who put in the same amount but started three years later blah blah blah. The data is the data and you can manipulate it how you like. That’s manipulate it how YOU like. Not anyone else. Choose that stats and argument that suits YOU.

This is the core of investing. What type of person are you? What is your attitude to risk? Is the glass half full, or half empty? You can put your money wherever you like and every FI who ever drew breath will advise you while pointing out that in the end this is your decision and the market can go down as well as up. Really? So, what you’re saying is, Mr Financial Adviser, is that essentially you have not the slightest idea what will happen in future? You’re telling me that past performance isn’t necessarily a reliable indicator of future performance while advising me with data that’s based on past performance? Well, what am I to make of that?

And there you have it. Here is what investing boils down to. It’s a game of chance. So to quote another American icon, do you feel lucky? Well, do you? If you do, take out that ten percent, or more, each year from your half a million pension fund. If you don’t, then take out 2% and feel safe. Or put it all in cash and then fret about inflation. Whatever, make a decision that you’re comfortable with and then, much more importantly, go out and live your life.