Why we’re retiring two decades early


‘The pandemic has given us the opportunity to reflect on what we want from our lives, and many are using this time as a catalyst to look forward to what’s important,’ says Stuart Lewis, founder of Rest Less, a digital community for midlifers. ‘Many people are deciding that early retirement, even if it means a more frugal existence, is the more attractive option.’

This trend echoes a movement seen in the early ’90s in the US: FIRE (Financial Independence, Retire Early). Its followers lived frugally in their earlier decades and saved a large proportion of their salary (for some, as much as 70 per cent), to create a nest egg. Only in today’s climate of exorbitant house prices and rising bills, it’s not so easy.

So who exactly can afford to retire in their 40s and 50s? Surprisingly those I spoke to aren’t super-rich, but hard-working professional women who have saved well, planned well – and in some instances benefited from good luck and timing.

‘Living through a pandemic and retiring at 45 has taught me to seize the day,’ says Claire Robotham during a Zoom chat from the remote northern Italian town where she is house-hunting. ‘I’m not going mad splashing the cash, as money is limited, but I’m not worrying about being too sensible.’

Claire, now 47, had risen through the ranks at accountancy firms before retiring last April – inspired by her husband Mark, who had retired at 60. ‘You never know what’s round the corner in life, so I thought why not quit and spend time together?’ Claire says. ‘When the pandemic hit, I just bit the bullet.’

She afforded it, she says, having saved into a pension since she was 18, invested in tax-free ISAs and paid off her mortgage early. ‘I’d paid it off by the time I was 35, pretty much unheard of among millennials,’ she admits. ‘When Mark and I got together we both owned homes, and I was able to sell mine and move into his. So we had a chunk of money, which cleared some of his mortgage.’

They also met with a financial planner who helped work out what they needed to live on and how they could maintain their lifestyle in retirement. ‘I never went without in those early decades – you’ve got to get a balance. But we were careful and thoughtful about our spending.’

She points out that not having children helped ‘as we haven’t had school uniforms or university to pay for and we don’t need to consider leaving an inheritance’. Today they live jointly on roughly £3,500 a month. ‘I’ve never lived extravagantly and even now, I have no desire to buy yachts!’

Of course not everyone can afford to quit their job, yacht or no yacht. Private pensions set an age minimum when you can start drawing money – for most it’s 55 or older. And then there is the further wait until at least 66 to draw your state pension, which currently stands at £137.60 a week. Meaning early retirees require a large nest egg.

Robert Caplan, a chartered financial planning director for First Wealth, advises that early planning and slow, steady saving is key. ‘Your future self should be your biggest monthly bill, more than your mortgage and certainly more than your holidays and cars,’ he says. ‘No one likes to get rich slowly, but it’s the only guaranteed way.’

For younger generations, saving this hard can be challenging, especially at a time when many are struggling to get on the property ladder, never mind pay off mortgages very early. 

‘Retirement in the true sense of the word will become less common [for future generations],’ says Tamsin Caine, chartered financial planner at Smart Financial. ‘A lot of people are making a career change or shift in direction instead.’

On the other side of the story, there are thousands of midlife women who have been forced into early retirement since the pandemic began – due to redundancy, fewer employment opportunities or age discrimination – with no financial or life plan at all. Stuart Lewis says this forced early retirement together with ‘the significant pensions-savings gender gap, and the gender pay gap, which increases with age, has left many women in real financial despair.’


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