The Retirement Newsletter: Quarterly review — end of quarter 2 2023
Issue Number: -29 — Another end of the quarter and another review
Welcome
Welcome to issue -29.
This week, it is time for a review of how my retirement plans are going.
This is my eighth review; previous ones are available at:
End of quarter 1 in 2023: Issue -42: Quarterly review
End of quarter 4 in 2022: Issue: -55: Quarterly review
End of quarter 3 in 2022: Issue -68: Quarterly review
End of quarter 2 in 2022: Issue -81: Quarterly review
End of quarter 1 in 2022: Issue -94: Time for another review
End of quarter 4 in 2021: Issue -106: How is my retirement plan going?
End of quarter 3 in 2021: Issue -120: Time for a quarterly review
And this is my second review in 2023.
So, how are things stacking up?
End of quarter review
My last review was at the end of quarter one, 2023. And If you read that review, you will know things weren't looking great. (The same was true at the end of the previous quarter — End of quarter 4 in 2022: Issue: -55: Quarterly review).
At the end of the last quarter, my summary was as follows:
“A summary of the situation would be as follows:_
Job — I’m sticking with it, there are problems, but I will ride them out.
Health — some niggles, and they are being looked at. Hopefully, nothing serious.
Life — as I said last quarter, I must keep working on this aspect of my plan.
Money — things will be tight if I retire next year, but it is still within reach.”
And now?
Job
I'm still sticking with it, and it is getting increasingly difficult. As I said last quarter, I will ride it out.
The problem with the job? Well, there are two — the workload continues to increase, and I can’t get to do what I enjoy: teaching. And second, a change in my general health means running long teaching sessions is becoming more painful.
Health
My health has taken a bit of a knock in the last quarter, as I've had to start taking more powerful drugs to deal with a long-term condition (see Ten Signs that summer has arrived).
I am still taking the drug, and the side effects are easing, and I can see some benefits from it. But, it has made me realise how quickly things can change and that I shouldn’t take my long-term health for granted. The new drug has made me more determined to stick to my retirement plans.
Life
As with last quarter, there are no fundamental changes, and things still need work. I have said this for the previous four quarters. I need to do something about it.
Money
I am not a financial advisor. I am writing about what I have read over the years about money and preparing to retire. This is not financial advice.
Things are still tight on the money side of things.
As I said last week in Happy Birthday! The Retirement Newsletter is 2! — What have I learnt over the last 104 issues?, inflation is not doing my plans any favours.
If I look at the three levels of retirement, the estimated income required was:
Essential — Gross, single: £13,800; Gross, married: £21,100
Moderate — Gross, single: £22,600; Gross, married: £32,900
Luxury — Gross, single: £40,200; Gross, married: £55,000
(Note: the Luxury £55,000 is a little tricky to work out as it involves another tax bracket.)
But, the above values are from before the recent high inflation rates. Hence, more realistic figures could be:
Essential — Gross, single: £15,800; Gross, married: £24,200
Moderate — Gross, single: £26,000; Gross, married: £37,800
Luxury — Gross, single: £46,200; Gross, married: £63,250
(Note: the Luxury £63,250 is a little tricky to work out as it involves another tax bracket.)
And that is a significant change and throws a lot of my calculations out, as I had been working to a maximum inflation rate of 5% per year. (I naïvely thought that inflation would never top 5% and that 5% was playing safe.)
Currently, I am not sure what to do.
One part of my pension is pegged to the inflation rate (as is the State Pension), so there is some protection against inflation, but most of my pension is not protected.
My investments, such as my ’stocks and shares’ Individual Savings Accounts (ISAs), are doing OK, but all I need is a downturn in the market, and I am in trouble.
It is worrying.
Please note I am not a financial advisor. I am writing about what I have read over the years about money and preparing to retire. This is not financial advice.
Summary
Things are not great, but they could be worse.
A summary of the situation would be as follows:
Job — I’m still sticking with it, there are problems, but I will ride them out.
Health — a recent change in the treatment of a long-term condition has made me realise I need to retire sooner rather than later.
Life — as I said last quarter, I must keep working on this aspect of my plan.
Money — the inflation rate is worrying me, but I can do nothing about it. I have some protection on parts of my pension that increase in line with inflation, but the current inflation rate means my investments are effectively standing still.
So, there you have it. Things are not looking great, but it could be a lot worse.
Let’s see what this next quarter brings.
Travel — Nostalgia corner
It doesn’t seem possible that it was only just over a year ago that I was celebrating the Platinum Jubilee in a small village in the UK:
And was it eight years ago I was heading off on a trip to East Malaysia:
Sibu, Malaysia — On the road again — Johor Bahru Airport (JHB; Senia) to Sibu, Sarawak, Malaysia — Air Asia and the delights of the RH Hotel, Sibu, Sarawak, Malaysia
Sibu, Malaysia — The Night Market, Sibu, Sarawak, Malaysia — Exploring the night market in Sibu — I like a good night market.
Sibu, Malaysia — Around town — Sibu, Sarawak, Malaysia — Exploring Sibu and the Sibu Bagel
Next week I will continue with my stories of exploring Sibu.
Useful links
UK Government Website:
Next week
Next week, in issue -28, I look at my last set of graduates.
Thanks
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Until next time,
Nick
PS, If you want to contribute something to the newsletter — a story, advice, anything — please get in touch.
Please note: I am not a financial advisor. Writing about money and financial matters is based on things I have read over the years about money and preparing to retire. IT IS NOT FINANCIAL ADVICE.