What would it take for you to never work again?

[Edwin]

Here's the scenario: there's a blank cheque in front of you. A billionaire comes up to you and says "I will sign that cheque after you fill in the amount, but you can strictly only have what it would take for you to retire and never work again - I'm not buying you supercars, yachts and planes!"

What figure would you fill in? Do you even have a figure in mind? Have you ever considered this question or a variant of it before?

Don't feel you have to post specifics, of course - money's an intensely personal thing, and every lifestyle and situation is completely different! This isn't meant to be some kind of financial voyeurism thread.

However, the mere act of asking the question of yourself - and doing a bit of quiet digging to find "your" answer - might just change your outlook on current or future projects and investments... You never know, but where's the harm in trying?

 

[tifosi]

I remember this question being asked someone about 15yrs ago and he said ~£750,000. I'd double that now and add a few hundred grand...

Cheque in the post?

 

[anthony]

Depends on so many variables such as current age, debts, health, etc. Personally at 50+ I'd go for a clean £1M, clear the debts, live on a combination of interest & capital, hopefully by the time i drop dead there would be very little left, allowing me to fit comfortably through the eye of the needle!

 

[Skinner]

I'm rubbish at maths, so I'm assuming inflation and such are not part of the equation and the quo is maintained.

I'm looking at £3,500,000, which gives me a comfortable income for 1 earner family albeit I'm single now. I got like 50 years in me, assuming I accept death in my 80s from lack of getting out of my chair

Edit: I didn't factor interest or current assets in

 

[Retired_member41]

Depends on so many variables such as current age, debts, health, etc. Personally at 50+ I'd go for a clean £1M, clear the debts, live on a combination of interest & capital, hopefully by the time i drop dead there would be very little left, allowing me to fit comfortably through the eye of the needle!

Great post.

 

[Adam H]

Thought about this a number of times over a couple of beers with friends, dreaming of that figure which would solve all of lifes problems.

Thinking along the lines of something like a 4% interest rate on the bulk of the cash i would probably say at being 30 years old , with a little on on the way in December if i was careful and didnt get carried away 1.5 mill would do me nicely.

My reasoning behind that figure would be as follows and i think in what i say below is far from extravagant, it would allow us to live a good life as a small family but it wouldnt give us the ability to share wealth with friends or family over and above hand outs ever so often.

£300,000 house in a nice area of the country
2 New cars
Re-furnish the new house etc.

I would basically allocate 400k for initial purchases , 100k to buy some nice shiny things and live a little plus the sale of our current stuff and the monthly rental or sale of current house would add to the pot.

That would leave me with 1 million in the bank , assuming it would be on something like a 4% interest rate ( i have no idea whether thats realistic ? ) then it would mean it would earn around £3500 a month interest which i would consider our living money, with no mortgage to pay im pretty sure we could comfortably manage

Honestly id settle for alot less but i think thats the figure it would take for me to say "thats it, lets enjoy life and not work at all".

The only problem is..........would that be enough money to keep you busy week in , week out with out working/getting bored.

 

[atlas]

No figure - will never stop working, no matter how much money I have. Work's too important to me - it's not just about earning money.

 

[aZooZa]

No figure - will never stop working, no matter how much money I have. Work's too important to me - it's not just about earning money.

Absolutely. I wouldn't dream of accepting that offer under those terms. And I'm 62.

 

[Edwin]

4% on savings is optimistic in this market.

Here are the top savings rates at the moment:
http://www.moneysavingexpert.com/savings/savings-accounts-best-interest

You probably want to go for longer term fixed rates and spread the money around to benefit from the FSCS protection (£85,000 per person per financial group - if you're a couple with a joint account you have £170,000 in protection)

In practice, you could probably get away with having about half the money protected, or a bit more or less depending on how much of a risk-taker you are. So that allows you to save £150,000-£250,000 per institution and still sleep well at night.

So if you average all of the best offers out, it comes to a bit under 3% gross (you would have to pay tax on the interest either at the basic rate or at the higher rate).

If you needed to boost your return a bit, you might figure on putting 25%-30% of the money into peer to peer lending, which is inherently risky (it's not protected, and has not been going very long) but can get you 5.5%-6%. See
http://www.moneysavingexpert.com/savings/peer-to-peer-lending

Depending on what your starting figure was, a combination of the above tactics could bring things back up to 4%+ gross return per year in exchange for the loss of security over proportionally more of the money. Of course you could diversify further into higher risk higher return stuff, but if you're talking money that is meant/supposed to last "for life" then you might want to be more wary than usual.

Also worth considering a few more points (some of these have been touched on in previous posts):

A) If you're "set for life" then you don't need to spend money on life insurance for you or your dependents

B) If you're not planning on passing money on to another generation, then it's fine to draw down on the capital after a while - effectively, you want to "die broke" but you don't want to die BECAUSE you're broke! So the math would be very, very different from the scenario where you're trying to preserve the initial lump sump.

C) If you no longer have to pay a mortgage/rent every month, your monthly outgoings might be a lot less than they are now, so you could have less coming in than you do now and still enjoy a better lifestyle (for example, if your rent/mortgage is £1K a month, you could take a £500 "cut" to your monthly income if the house was already paid off in full, and come out £500/month ahead compared to where you are now)

D) Inflation is the killer, but people also generally tend to spend less as they get older and lead less active lives, so assuming you're of a certain age already the two may cancel each other out

E) "Not having to work" doesn't have to mean "sit by the fire watching fairy castles in the flames". You can still do anything you want, but none of it has to be driven by the NEED to earn a pay cheque.

 

[ian]

Not factoring inflation, I can't see why a comfortable life for my family wouldn't be £25k year. We don't spend a lot of luxuries and that clearly isn't the name of this game. No debts, mortgages here etc which I assume can be considered. Based on living until 100, it is still quite a substantial amount when you total it up! Scary in fact.

However, I'm not sure I could stop working, have worked solidly since 16 with only 2 holidays (terrible I know!) and think I'd just drop down dead with that motivation gone.

 

[Edwin]

However, I'm not sure I could stop working, have worked solidly since 16 with only 2 holidays (terrible I know!) and think I'd just drop down dead with that motivation gone.

It's interesting, isn't it? For everyone who feels the same way, there's probably somebody else "punching the clock" at a job they don't like much, and doing so only to pay the bills. One thing that might factor into the picture would be if somebody has a real passion or hobby, something that they could happily take to the next level in terms of participation/commitment, if they didn't have to worry about the time suck that represented...

At the end of the day, it's nice to find fulfilment in something (or many things), be that work, hobbies, family, travel etc.

 

[mat]

I have thought about this before and I would hate to be given or win such a large amount that I can retire.

Wherever I end up in the future I want to know that I was the one who got me there, whether that is a very normal life, or stinking rich. As long as it was down to me and my choices.

I think I would become depressed if I had everything but it was down to a lottery win or a hand out.

 

[stender]

there's probably somebody else "punching the clock" at a job they don't like much, and doing so only to pay the bills

That'll be me

 

[scottmccloud]

I don't look at it in terms of work and not working, I enjoy what I do.

I look at more in terms of control. Before working for myself, I hated the fact that I had to ask permission from my employer to go the dentist when I had toothache, go to see my little girl's school nativity play or have a few well deserved days away.

I don't have to ask permission to live my life any more. That makes me happy.

 

[Skinner]

I would love to hit something more fulfilling, without the constraints of earning a living, I'd like to do something with Animals, charitable stuff. Currently my charitable efforts are a % of my ebay sales, calendars, the odd justgiving, etc. This could open the potential for XX hours of my time per week.

Many here are seeing this as "I'm lying down and dying", I didn't see this that way.

 

[monaghan]

I'm not sure I'd want to give up work, most of my time is taken in systems development. The problem solving and then implementing a solution is the challenge which motivates me, the fees just do the menial things like paying the mortgage and bills.

I guess a few million would let us get a place in the country with a few acres of land for some animals and cover all the financial aspects for the next 40-50 years and then I could "work" for some charities to keep the mind active.

 

[Aegean]

I would love to hit something more fulfilling, without the constraints of earning a living, I'd like to do something with Animals, charitable stuff. Currently my charitable efforts are a % of my ebay sales, calendars, the odd justgiving, etc. This could open the potential for XX hours of my time per week.

Many here are seeing this as "I'm lying down and dying", I didn't see this that way.

Absolutely. If I could have enough money to actually really help some other folk, that would be worth a lot more to me.

 

[Philnorris]

In one year I stop "punching the clock", I have enough money (due to my domain/broker hobby) to buy a small house in the country. I have enough bits on the side that can occupy me for 5 hours a day to keep me in clothes and a couple of holidays a year.

No mortgage and no debts, small but steady income, big garden, veg, pigs and chickens = a very happy me.

A pension that kicks in that ensures the income levels don’t change, so if the billionaire made me such an offer I really would only need 25 to 30k a year to ensure a comfortable life. OK i will not be rich but I would be a very happy man. Just need to find a few hobbies as I suspect the reality will be different ;-)

Life is too short, the more you earn the bigger the bills. Retirement does not scare me, I welcome it. I want to explore, I certainly don’t want to sit in my garden pruning roses. My father retired and sailed around Europe for three years, he is now in France, has a house in Spain and Ireland and is always on the go, and very happy.

 

[iamrofe]

No figure - will never stop working, no matter how much money I have. Work's too important to me - it's not just about earning money.

I couldn't not work. I think initially it would be good, but you'd get so bored, it's not just about the money, you need a sense of purpose. I think you'd lose that to some extent if you don't work.

 

[Edwin]

In one year I stop "punching the clock", I have enough money (due to my domain/broker hobby) to buy a small house in the country. I have enough bits on the side that can occupy me for 5 hours a day to keep me in clothes and a couple of holidays a year.

No mortgage and no debts, small but steady income, big garden, veg, pigs and chickens = a very happy me.

A pension that kicks in that ensures the income levels don’t change, so if the billionaire made me such an offer I really would only need 25 to 30k a year to ensure a comfortable life. OK i will not be rich but I would be a very happy man. Just need to find a few hobbies as I suspect the reality will be different ;-)

Life is too short, the more you earn the bigger the bills. Retirement does not scare me, I welcome it. I want to explore, I certainly don’t want to sit in my garden pruning roses. My father retired and sailed around Europe for three years, he is now in France, has a house in Spain and Ireland and is always on the go, and very happy.

Congratulations, sounds like you've got it figured out pretty neatly, and a year will go extremely quickly...