How Do You Give Up Work And Survive In The UK?
This blog post will help in answering the question of how can you give up work and survive in the UK. To answer this question we will explore alternative sources of earnings for individuals who aim to give up work; as well as discuss the key factors that determine how soon (or later) in life can someone choose to take the decision of giving up work.
How Do You Give Up Work And Survive In The UK?
You can give up work and survive in the UK if you have investments in any of the following areas:
- The stock market
- Mutual funds
- Real estate
- Savings account
The stock market is a high-risk yet high-return option. The expected interest rates are currently more than 9% which means that the higher and well diversified your investment, the better returns you can expect. However, being a high-risk option, the stock market can become highly volatile during uncertain economic and political times.
If you want to give up work, another option is to invest in mutual funds. This is considered to be a comparatively safer option. However, with low risk, the returns are also comparatively lower with the current rate set at 5%.
Another low-risk investment option is real estate with usually medium to high returns. You can choose to live off the rental income earned through the property you purchase today or invest in real estate today to sell in the future and make lump sum returns. However, the time that it takes for a purchased property to gain value for a sale may take up to a few years and it would be advisable to use it for rental income during this time.
Then there are savings accounts in a bank where you can keep your savings and earn the interest on them. This is a low-risk and low-return option with fluctuating rates of interest as changes in the rate of inflation take place over the course of time.
If you wish to give up work because you are unhappy with your job, there are options to start your career as an entrepreneur with minimal investment or even attain seed money for your startup through crowd-funding.
However, if you feel the need to give up work due to a health condition or a disability and need financial support to survive in the UK, you can apply for welfare benefits through the Department for Work and Pensions.
You may be able to claim Universal Credit if you are on a low income or unemployed and need help with living costs, housing, healthcare or childcare expenses. If you are faced with a disability or a severe health condition that prevents you from working or affects your ability to work, you may be able to claim Personal Independence Payments to cover your basic requirements.
Additionally, you may also be able to claim Council Tax Reduction on your property or qualify for Council Housing if you need to give up work due to personal circumstances and do not have financial resources to survive on your own.
How Do I Know If I Can Give Up Work And Survive In The UK?
Whether or not you can give up work and still be able to survive in the UK, depends on the following factors:
- Your age and health condition
- Your savings and investments
- Your living expenses
- Your dependants
- The rate of inflation (current and future) in the UK
- The cost of living expenses (current and future) in the UK
If you aim to give up work early in life such as in your late 30s or early 40s, you may find it difficult to manage the cost of living expenses with rising rates of inflation; especially if you have chosen a low-risk, low-return investment option.
On the other hand, if you stop working later in life, such as in your late 40s or early 50s, you would ideally have made sufficient and diverse investments across low to medium risk and returns to generate income that can help you survive in the UK.
If you think you need the services of a professional investment advisor on this matter, you can search for one through Unbiased for expert financial advice.
On the other hand, if your health (physical or mental) condition prevents you from being able to perform work-related tasks, you should first seek medical advice regarding the option and need to give up work.
Based on a doctor’s assessment, you can then apply for welfare benefits and council housing on medical grounds. This will help to reduce your expenses and provide substantial income (through benefits payments) to help you survive in the UK.
How Much Money Do You Need To Give Up Work And Survive In The UK?
How much money you need to give up work and survive in the UK depends on your savings and expenses.
To arrive at a close estimate, you can start by working out the details of your:
- monthly expenses
- direct debit payments (if any)
- earnings through investments and savings
- taxes to be paid
You may also need to work out the details of expenses that can be reduced and earnings that be increased as well as set up aside a sum as an emergency fund.
Keeping these estimates in view, you would be able to calculate a reasonable amount that you would need in savings before you can give up work.
If you need help working out your budget and don’t want to hire a professional, you can get free budgeting advice online with a budget calculator from the Citizen’s Advice Bureau. It will also guide you on how to manage your expenses so that you can increase your savings.
Another option is to use the Natwest Budget Calculator for your financial planning.
The above content has helped in drawing the conclusion if you want to give up work and survive in the UK, you will need to (a) consider your sources of income and living expenses and (b) work out a budget and a financial plan. If you do not wish to work, you may need other sources of income whether it’s through renting out a property or investing in shares or bonds, to survive in the UK.