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skiddingtowardsretirement

semi-retiring, work life balance, lifestyle block living

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Financial planning

Newly retired

At 4.15 pm on 7 January 2022, I posted my swipe card through the hospital library’s after hour slot and walked out the door into early retirement. I admit I was tempted to skip out the door, but felt that was slightly tasteless!

It has taken me close to seven years of planning and saving to get here, but even at this early stage of being willfully unemployed, I can categorically say it was absolutely the best thing for me to do.

I wake up each morning feeling more relaxed, happy, and energised than I did when I was working. I also feel fitter and slimmer (no scales, but my clothes are already looser) – this is hardly surprising as my last two roles have been sedentary, desk-bound jobs – a pretty unnatural way to live, right?

Although a mere eleven days into retirement, my days are shaking down into a sort of schedule with a mix of housework (yes, I don’t overdo it, but the house is still looking way more ship-shape), a bit of gardening, some stripping of wallpaper off the kitchen walls (its painted over, so think ‘nightmare’ here), and lots of reading, walking and swimming.

I am also back writing for a few hours each day – a book I started seven years ago is finally getting some long overdue attention. It would be nice if the book when finished gets picked up by a publisher, but even if it doesn’t, its writing gives me immense pleasure and that in many ways is enough!

Early retirement – there is a lot to be said for it.

Finances:

My last pay is tomorrow.

From then on, our income will be the man’s state pension and a top up payment from his private superannuation fund Kiwisaver, which we added our early retirement savings to.

This will require us to follow the budget that we have written.

We think it is doable and that we have covered every contingency, but, regardless, of whether it does or doesn’t pan out as we have planned, we will let you know!

Almost retired

At the end of this week, I will lock up the library, post my swipe card through the after hours slot and walk out the door as a paid employee for the last time. It has taken me six to seven years of planning and saving to get me here, but I have made it!

So how do I feel about this (imminent) early retirement? It is, to be truthful, both a frightening and glorious feeling. Frightening, because I am saying goodbye to the structure employment has given me and also to the fortnightly pay check (never a six figure salary, but always welcomed). Glorious, because my time is now entirely my own to do with as I wish!

I have no doubt that I will feel like I am on holiday to begin with and that is fine with me. As I settle into the new norm, I suspect life will shake down into something more structured and I am happy with that thought as there is only so much holidaying one can do and I have things I want to achieve!

Roll on Friday.

Early retirement money matters :

Kiwisaver fund:

The man has changed his Kiwisaver (private superannuation) account to a balanced fund from a conservative fund. Historically, the balanced fund has paid better returns, so although slightly riskier, we are willing to take the chance in the hope it will keep us ahead of inflation for the thirty three months we need it.

My kiwisaver fund has always been in a balanced fund, so no changes are needed there. I will continue to contribute at least the minimum amount required to get the Government supplement each year until I am 65.

Early retirement funding

We are putting most of the savings earmarked to fund early retirement into the man’s kiwisaver: the returns being better than any bank term deposit.

We are setting up a fortnightly withdrawal from this fund to cover the period until I turn 65 when I will be eligible for government superannuation and can access the funds in my Kiwisaver account.

We are leaving an additional few thousands in a savings account as an emergency contingency fund. We hope not to use this.

Please note we do have other funds invested. These are a share in a property and in a few shares. We are not intending for these to be used to supplement my early retirement.

A perfect fit

It is Sunday afternoon.

Our weekend has been a corker one. Firstly, the weather has been summery which is always a plus.

Secondly, the man and I have managed to fit in a nice balance of productivity and relaxation.

The productivity side included going through our wardrobe to identify clothes we no longer wear. For the man, the clothes he pulled out were only fit for rags or the bin.

Mine? Well, mine are all in pretty good condition but are no longer fit for purpose. These ‘no longer fit for purpose’ can be divided into three categories. The first are the clothes I no longer fit – yes, I have finally admitted that I will never again squeeze into those lovely GAP jeans I bought in London in 2007. And, Dear Reader, this isn’t weight- related surrender – the reality is my 62 year old body is a different shape entirely to the one I had in my late 40s. Blame estrogen depletion, rather than a high fat diet!

The second lot I am culling is way more exciting though. These are the clothes I wear to work. As I have about two months employment to go, the cull is a bit restricted, but I have made a start. To this end, I have a bag full of shoes – high heels, anyone? l also have a bag of work clothes that I won’t be wearing between now and retirement day.

The third pile is clothes I will never wear again because I simply don’t like them. The fact is I probably never liked them, but kept them just in case I might one day have an epiphany and change my mind! I haven’t. Time for them to go!

Unlike the man’s rags, my clothes will be sent to the local charity shop, where I hope they will find a new owner to love them.

The second thing we got rid of was our old fridge. I had kept it on the offchance I needed the extra freezer space for one of the lambs presently grazing in our paddocks – yes, country life can be harsh if you are a lamb! However, I have decided that the extra space is not needed so yesterday I cleaned it out ready for its new owner and ran it overnight to make sure it was in tip-top running order, which it was. Today I put it as a ‘Free to good home’ bargain on the community Facebook page and it was snapped up straight away and picked up shortly after. A win for both parties, I thought!

This afternoon the man and I factored in the relaxation time in the work/life balance equation and drove to The Deck Cafe in McLeods Bay for afternoon tea, before heading to Urquharts Bay for a walk along the beach. As we strolled along, we said hi to groups picnicking or just hanging with friends and family. In the water were a few swimmers. Further out from the swimmers were boats anchored with dive flags out. If you squinted your eyes up, you would occasionally see a diver surfacing with their bag full of scallops. Kai moana at its best!

The man and I love this part of the world with its beautiful scenery, friendly community, and laid back vibe. It is a lifestyle that is a perfect fit.

Retirement Planning:

I recently read a financial article which stated that due to loyalty (or, should that be, inertia?) most of us stick with companies that are no longer the best for us, be it what it covers and/or price. The writer of the article suggested we take a more business approach and review the companies we deal with on a more regular basis.

As I read it, I nodded in agreement. We are loyal old things and we have been with our insurance company our entire married life. It was way over time for a (mini) review. As I am keeper of the purse, this job fell to me!

Insurance:

The first thing I did was check the policies and what and how much they covered. I was pleased with the replacement value on everything.

I then looked at the payment side. We are paying our premiums (house, contents, 2 vehicles) on a monthly payment plan. I know if I pay these premiums annually, there is a discount. I think it used to be 9%.

I contacted my insurance company to find out how much the annual payment discount was now, but have been told that each time a policy comes up for renewal that the annual payment discount would be calculated then. This is weird, but I am willing to work with it at this stage.

The policies will come up for renewal in three lots – the vehicles are two separate policies, but the house and contents are due together. As they come up for renewal, I intend to get the two prices (annual and monthly amount) I will also compare the price with other insurance companies to see if it is competitively priced i.e. I will get quotes from other insurance companies*. I will then make the decision as to what is the best option for us regarding the company I go with and whether I pay annually or monthly.

*I will check reviews of insurance companies too before I make any changes.

Rhythms

Life on our land follows a relaxed rhythm year in, year out.

In July, the lambs were born. Always cute and fun to watch, our relationship with them has been short and sweet this time round – indeed, six weeks after their birth, we wished them au revoir when they were moved with the flock to a neighbour’s piece of land with more grass.

A few weeks ago the man began to source wood from the block for next year’s supply. As I will be retired next winter, the fire place will be used more throughout the day so the woodpile will need to be a considerably bigger than in the past. Luckily, the man enjoys the process of collecting, cutting and stacking wood. It does help that he has great tools for the job with his trusty, newly-serviced chainsaw, and his bow saw, plus all the PPE.

Marmalade making has also begun. This year, I am freezing the fruit so I can make small batches throughout the year.* I have been making marmalade so long that I can make it by eye, rather than by following a recipe – I have come a long way since my first batch many years ago where I boiled it to the point that it had both the look and consistency of toffee. The young me proudly gave the man’s mum a jar or two which she politely thanked me for and never mentioned again!

The spring weather is inspiring us to make long-overdue changes to the orchard and garden. Two apple trees which are past their best are going to be removed, as is a persimmon which has inedible fruit (a mouthful of cotton wool, anyone?). Two other sad excuses for fruit trees will be taken out in the next few weeks. These non-performers are going to be replaced with new trees including the Wilson’s Early plum which we planted yesterday.

The gardens are also having work done on them. The vegetable garden which was all, but abandoned, is relocating to just beside the house. A sunny spot, this should be a more workable location. We will start off smaller than the original one, but will expand it if needed, The worm farm which has been a success from the get-go, will also move closer to the house – again it will be considerably more convenient in this new spot.

This only leaves the compost bin. To date, we have never sorted out how to compost properly. The intention is to move this closer to the house too, and use it as it should be used. Yes, getting a handle on composting is one of the many things on the retirement list.

Lastly: With eight pays to go until I retire, everything is falling into place. Savings are going to plan, and the things I wanted completed are being ticked off one at a time. This month we saved more than we had projected we would, and ticked the three-yearly septic tank clean off the list. I also started an audit on what we are paying for bills – but that is for another blog.

Early retirement: I can’t wait.

*Wash whole fruit, cut into quarters and freeze in batch lots

Ride-on Hassles

For the last few months, the man and our ride-on mower haven’t been getting on. We blame this entirely on the machine which mostly refused to start and when it did start, refused to run for long.

The man would then spend the next few hours coaxing it to go long enough to do our lawn. Our frustration levels, meanwhile, went through the roof and our tolerance plummeted. Wrangling with a recalcitrant ride-on was not how we envisaged life in the country, we both secretly thought.

Which is why we needed to do a rethink about this lawn mowing thing. So we did. And we came up with two options.

Option A was to purchase a brand new mower and continue to do the lawns. The price of a new machine was between $8,000 -$12000. In addition to this, there were the ongoing running costs of petrol, oil, and everyday maintenance to factor in. At some stage in the distant future, this new mower would no longer be new and we would be up for a replacement one too or be back to where we were now – fighting with the mower to get it going. We tucked this (awful) thought into the back of our minds.

Option B was to out-source the task to a lawn-mowing contractor with his own machine. The quote was $100 per cut. We did the math. We could get 80 – 120 cuts for the price of a new ride on. Factoring in the additional running costs of petrol, oil and the maintenance costs and hassles, it made even more sense. At a cut averaging once every 4 weeks, that would be a fair few years taken care of.

Needless to say the winner was Option B. It was way more cost effective, removed the hassle of maintaining a machine and gave us some time back which we can use more productively on the property. It is money well spent.

Meanwhile, we have gifted our old ride-on to a local mower mechanic. It is been used for parts in reconditioned ride-ons.

Lockdown

New Zealand went into lockdown on Tuesday last week. The last time I was in lockdown was for five or so weeks last March/April 2020.

It is weird living in lockdown – almost other worldly. Where we live the traffic is always light; it is now even lighter. Working from home, mask wearing, social distancing, bubbles and sanitizing are the words of the day.

In spite of its challenges, this lockdown has completely removed any doubts I have been harbouring about retiring early. Indeed, it has categorically demonstrated that it is the right thing for us.

The fact is my enthusiasm and self-motivation levels have increased significantly this last week while at home, even though I am working remotely. I guess rolling out of bed at 7.30 instead of 5.45, and the no travel means I am not exhausted by the end of each working day.

Certainly this weekend, besides the never-ending cleaning and washing, I had the energy to finally start stripping the wallpaper in the kitchen, a job that I have put on the back burner for months. I also made bread, baked a slice, went for a walk, and spent quality time with the grandchildren in our bubble. I also managed to finish my book, and start on a new one. Bliss!

Bread – didn’t know if was going to be successful as yeast was old!
Wallpaper stripping – an OK job when you get into swing of it

The garden beckoned too – truthfully, I have ignored it since I started back full time 21 months ago , but this weekend, I rediscovered the itch to get my hands dirty working in it. Pity I ran out of time, but I now know that when I am no longer time poor, I will be out there getting it back into shape. Hallelujah!

Early retirement will mean we have to watch our dollars a bit more, but the man and I have no doubt whatsoever that the pluses of a more satisfying and balanced lifestyle makes this sacrifice absolutely worth it.

Roll on retirement.

Time to hang around the fire pit and toast marshmallows. The teenage grandson camped in the tent.

Putting the house in order

Having publicly committed to retiring in the New Year, I am getting my house in order.

This means making decisions about what we need to do to make our retirement work well for us. I have therefore got a list and a budget – a true Virgo, right?

My list started off with many grand things including recarpeting the house, recurtaining the bedrooms, a new fridge and a tent for copious camping trips. I have subsequently rethought this and the list is no longer an absolute, rather it can now be described as ‘a work in progress’ with items being added, taken away or parked.

The changes I have made are sensible ones, I think. I have decided against recarpeting – the carpet is fine and I am just bored with it. I also want to replace it with wool (it is wool now) and that is not cheap. I will therefore do it in a few years when most of our retirement savings can be accessed. The curtains – well, I have washed them initially in a bit of bleach, followed by a rinse and two out of the three sets are perfect again. The other one? A sad story really that would bring a tear to any house proud person’s eyes – suffice to say, I will buy new ones!

The new fridge? Well, I have purchased one after much research (how big, what make, energy rating etc etc) and it is looking mighty fine in the kitchen. The power bill has also reduced which is an added bonus.

The tent for our NZ trips has been relegated to the ‘decision pending’list. I will keep the $$ aside for it in the budget.

New additions to the list include a cat door with a microchip so our kind neighbour can feed our moggies, rather than every cat in the neighbourhood when we are away adventuring. I have also factored in some maintenance including the three yearly septic tank clean and new glasses for me.

Meanwhile, I am saving hard for this early retirement lark, albeit I am fast coming to the conclusion that we will dip into our savings pot early if required so we can do the things we want to when we want to. Yes, life is short, and we don’t want to live with regrets.

Carpe diem, folks!

PS I have been told I can join the temp pool at the hospital where I work any time which is kind of nice, though at this stage this is not what I see in my future.

Shuffling into retirement

The man is now a Gold Card holder and is mighty pleased to be one. For those who don’t know, this means he receives a pension, or as a friend wittily puts it, he is now paid by the Government to breathe.

In relatively recent days – up to November 2020 to be precise – I would have been able to piggyback on his pension eligibility and receive one too if I retired. He, however, turned 65 in March 2021, so this door to early retirement funded by the state firmly closed to me.

When this change in eligibility was flagged, I wasn’t overly worried. The fact was I had only recently become aware of its existence, so I had never factored it into retirement planning.

Which brings me to my plans for retirement. I have plans to retire early. I have a date in mind where I will shut the door on a 8-4.30, 5 day per week job, and it is not too far away. To this end, I have worked out a retirement budget – thank you, sorted.org.nz. This budget is sensible – well I think it is! It reflects the changes in spending that happens in retirement e.g my day to day fuel bill will decrease substantially with no daily work commute, our electricity bill will rise, there will be no need to fund office clothes, even TradeMe purchased ones, spending for local outings, the occasional trip within NZ* and activities will increase. Yes, the budget has been worked out to allow the man and me a good lifestyle, with a bit of latitude factored in for those unforeseen expenses. Of course, the reality is we are not big spenders at the best of times, so that works in our favour, as does being mortgage and debt free.

Ideally, we don’t want to rely on the man’s Kiwisaver (private superannuation) balance* to fund our day to day living costs, but it will be our backstop if required – after all, we intend to enjoy this stage of life! Meanwhile, the man and I are saving as much as we can from our income to help fund the early retirement. We are also working to grow the small hire business we have – if Covid stays away, this should provide a welcome addition to our retirement fund.

Our plans for me to retire early aren’t just about getting the income sorted, we are busy getting our house in order too. This means replacing and renewing a few things: a new fridge freezer (our old one is on its last legs), a touch of decorating, and new flooring in kitchen and hall, plus a new gate to keep the sheep safe are all on the list. We have also upgraded my 21 year old car to a new Kia Stonic – the perfect jalopy for retired us to do our road trips.

After 45 years of working, retirement is just around the corner – and I must say, it looks grand!

*Overseas trips are off the agenda while Covid rages. When we feel travel is safe, we will fund it from retirement savings, rather than our sorted budget!

*I have Kiwisaver too, but won’t have access to it until I am 65. I will continue contributing enough to it to get the Government subsidy each year until I turn 65.

Water play

The vegetable garden has been neglected since last summer when an eight or so month drought played havoc with our capacity to water the plants.

This lack of rain had been exacerbated by a connection on one of our tanks failing in mid-winter 2019 while we were overseas. This resulted in the loss of every drop of water in that one tank. Our available water was halved.

Luckily our tame herd manager came to the rescue in our absence, reconnected the hose and kindly ordered a load of water for us. The price of this 10,000 litres was eye-watering high, but hey, we thought spring is around the corner and it always rains in spring and our water problems will be solved.

Spring 2019 was rain-free.

As spring turned into summer, the drought bit and economic or miserly us, depending on your world view, made a pact to conserve water, rather than buy it in. Our tight approach was fashionably in line with the council request to go easy on usage – sad losers, we are not!

Over the summer of 2019/20 we honed our conservation skills. Recycling became our buzz word. We limited flushing the toilet to only when absolutely necessary. We abandoned the dishwasher in favour of washing the dishes in a bucket in the sink. We then popped the used water onto the plants. We caught the first water from the shower while it was heating up and used this too in the garden. We tried collecting the water from the washing machine, but due to reading the litres the machine used incorrectly, I flooded the hall carpet. At that point I gave up that idea.

Our efforts to keep the plants alive over this period weren’t successful. We got a few tomatoes, some potatoes, half-formed corn and some bitter tasting lettuce. With the drought still continuing, I let the garden go to seed.

After lockdown ended we finally had rain. These two events were enough to inspire me to make an half-ass attempt to plant a few winter crops. I planted spinach, cabbage, cauliflower and beetroot. In the depths of winter, I lost the will to tend them.

Subsequently, many of the cabbages and cauliflowers fell victim to vermin and didn’t survive or didn’t survive to look pretty. The spinach flourished and is presently threatening to go to seed. I am not sure why I planted it; the truth is we aren’t overly keen on spinach except when it is used in the occasional spanakopita.

The beetroot.. well, the beetroot is my success story. Today I picked two good specimens. I will boil them, slice them up and pop in vinegar following the Edmonds Cookbook recipe, just like my mother and grandmother did before me.

Beetroot is the perfect accompaniment for a salad, and let’s not forget, hamburgers – beetroot is the absolute making of a homemade hamburger.

Today I planted more beetroot. And tomatoes. And capsicum. And lettuce. And chillis. And courgettes. And cucumber.

I gave the spinach a miss.

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