The question, I got asked the other days was what I was doing for myself – rather than what I’m telling others to do – as I prepare for retirement.
In summary-I am adopting a wait and see strategy.
My heart tells me that by investing in a portfolio of good equities (as Terry Smith of Fundsmith does), I can obtain a reasonable income over a sustained period of time which will increase with economic growth,
My head tells me to be more cautious and pursue some alternative strategies such as those mentioned by Mr Dixon!
The more complicated this gets, the more inclined I am to use a fund manager but my heart still tells me that I could probably replicate a buy and hold strategy of a good manager at minimal cost.
Whatever I do, I’m doing it for the long term. I am 52 and Mark Rowlinson’s Death Predictor tells me that I have 40 years left in me, so my thinking is around the long-term. You can work out how long he expects you to live here http://lifetime.faife.co.uk/
My only other consideration is the mechanics of drawdown. I don’t want to get into anything as fussy as Helen’s suggestions, because I’m not that well organised and would much it up. But I like the idea of keeping my options open so the flexible lump sum rules look good.
If, and I think we’re a long way from saying “when”, we have an option to transfer money into a Collective DC scheme, I think I would want to supplement the guaranteed income I’ll have in retirement, with the relative security (and longevity protection) of a CDC plan, leaving a third portion in individual drawdown either in a passive multi-asset fund or directly invested in good quality equities.
Hopefully, in three years’ time I will be able to think about these options more clearly, as new products come along.
I’ll be looking forward to talking this through at my guidance meeting and I’d certainly be testing my ideas with an adviser (or two). I suspect that I’ll be asking a few questions on blogs such as this , to make sure I’m not doing something radically stupid!
The gallery below details the lifestyle choices that I will be pursuing
Henry, Eamonn with the Pension PlayPen colours!
Henry and Tim – NEST worthy winners
With Donna – attempting to win Pension Personality (again)
