The Lemon Fool

1nv35t wrote: With £1.3m Talmud advocated third each in land (home), commerce (stocks) and reserves ... and up to 430K 'cash' is acceptable. You forego potential higher rewards but reduce the risk of over-concentration into any one asset. .

Thanks for the reply 1nv35t - you said using the Talmud we would divide my £1.3m Total assets into £430K (house), £430 (stocks) and £430 (cash/Bonds/Gold)

However, if I added the capital value of my DB pension (20x £18Kpa= £360K) into the calculation then each asset would be a third each of the new total amount of assets £1,660K.

This divides into £550 (Property) + £550 (stocks) and £550 (reserves) = £550 minus the £360 DB pension value = £190 left to allocate in Cash , Gold or Bonds.

What do you think?
Tim

Despite all the worthy and detailed comment above, I suspect that we're all missing something fairly obvious here (at least from my point of view).

If one assumes that the object of "retirement" is to live out one's remaining years comfortably, go on a few cruises, etc. and NOT to amass a vast fortune which will never be depleted, eventually to be passed on to one's heirs, then it is quite clear to me that the OP should retire tomorrow.

He is sitting on a huge pile of money which he will never actually spend. (Especially since it is obvious that he and Mrs. OP are quite prudent). An active sixty-something can burn through cash at a fair rate if they try hard, but with the best will in the world, by the time you hit the 80s, hedonism will be greatly reduced.

You can't take it with you...........

I think the OP has done pretty much everything right. He tax sheltered most things, and what's left will come under allowances. If he wants to keep in cash for diversification but is prepared for more risk, he should consider peer to peer lending, not gold.

I think £1.6m can sustain a £45k lifestyle, especially from early 60s

Hi 1nv35t
- So you hold physical Gold rather than Gold ETFs or Gold Funds ?
TimR

gipsyracer wrote:By the time you hit the 80s, hedonism will be greatly reduced.

As a counter example I offer my very, very aged grandmother: She has the alcohol intake of an entire house party of freshers, the "dead soldiers" piled up in the recycling have to be seen to be believed. She still likes to be off cruising the world following the sun. When at home and the opportunity arises I catch her gambling on her beloved nags, with knowledge of form that would shame Statto.

That said, she is declining, probably much to Ladbroke's relief. Oh, how they must rue the day she got a laptop, and reading glasses strong enough to place a bet! I hope I am having as much fun if I hit 90.

[quote=" BreakoutBoy - "I hope I am having as much fun if I hit 90"

I don't have as much fun as that now !
TimR

JohnB wrote: I think £1.6m can sustain a £45k lifestyle, especially from early 60s

Thanks for the reply - The figure of £1.6m includes everything we currently have - house, investments , savings and the capital value of my DB pension (20x £18Kpa= £360K Capital value).

My £45K lifestyle is pretty modest compared with most but it assumes my wife will carry on working earning at least £10K pa . My wife however is only 56 but she will be OK as she will be covered by my DB pension when I die.

I will look at peer to peer lending for some of the ISA cash currently earning a low rate..

I do worry about the future my 24 year old daughter who is renting in central London with her boyfriend (they are not high earners) and have no hope of getting on the property ladder, but as I said at the beginning - if I gave her any money at present she would probably spend it on travelling and entertainment.

1nv35 - Thanks for the reply - So 'reserves' would not contain anything higher up the risk scale ie - Corporate Bonds, High Yield Bonds, EM Bonds, Peer to Peer.
Only lower risk reserves eg- UK Gov Bonds , Cash, Gold ?

TimR

With the £100k in a case ISA at 0.6%, might has well take it out and pay tax on it but find a fixed rate bond. Alternatively, buy 2* £50 k of premium bonds. I reckon you will do better than 0.6%.

monabri wrote:With the £100k in a case ISA at 0.6%, might has well take it out and pay tax on it but find a fixed rate bond. Alternatively, buy 2* £50 k of premium bonds. I reckon you will do better than 0.6%.

Premium bonds currently pay out at 1.15% - tax free. Obviously you could have above or below average luck (and the median amount, even on £50k, is below the mean)

https://www.moneysavingexpert.com/savin ... alculator/

is handy if you want to play about with the odds.