Tell me where I’m going wrong
Hey all.
I’m currently targeting a retirement age of 50, and I’m currently 35. My target is an ISA value of £550-600k. I currently add 25-30% of my income to my ISA, and also contribute 5% to my SIPP with my employer adding 10%. This will be accessible from 57 at the moment, so my ISA is intended to allow me to retire earlier than that. My personal contribution rate to the ISA is weighted thus to maximise the amount available from 50 or whenever I hit my target.
I intend to invest the ISA in investment trusts with histories of growing dividends (property, ftse index like CTY etc) when I hit the desired amount, aiming for a blended yield of 5% which will be my sole source of income between retirement and gaining access to my pension.
With an aim of having expenses below £25,000 a year, I see this as totally attainable as I’ve been tracking my finances religiously for the past couple of years. The access to the pension will just boost my income when it unlocks.
What am I overlooking? Is a portfolio of this size and yield all I’d need to fund my retirement?
I'm really disciplined with my finances, and have been educating myself on behavioural finance over the last year, but for some reason I feel like it can't be as simple as the approach I've outlined. I'd genuinely love to hear people's thought's and any advice from people who may have taken a similar approach!
Thanks in advance.
Edit: Update from 'pension' to 'SIPP'.
I'm currently paying in £1000 a month to the ISA, intending to increase by £100 each year up to £1,666p/m which will result in maxing out ISA contributions. SIPP is at £39k at the moment, ISA at £10k, with personal and employer contributions to SIPP totalling just shy of £800 a month.