The current plan for the Snowball is to re-invest all earned dividends back into the portfolio with an income target of £14,500.

If you have longer to retirement, compound interest growth starts to accelerate the longer you stay invested.

If we use CTY as the working example, your capital should increase if you have an unexpected call on your cash. No guarantees though.

Also the earned dividends would be re-invested, either back into the share or another Trust, earning more dividends to re-invest in the portfolio.

The options for you cash, the totals are the unknown.

An annuity yielding 7% but you have to surrender all your cash.

Interest rates may be lower a lot lower, that’s the gamble.


Canada Life figures show the 65-year-old with a £100,000 pension pot could buy an annuity linked to the retail price index (RPI) that would generate a starting annual income of £3,896. That’s up from £2,195 in the New Year following a 77% spike in rates this year.
Oct 22

So not an option for me.

The 4% rule.

To use the 4% rule your 100k would need to have grown to £360 k.

Good luck with that.

Also if you want to pass on any of your wealth, your fund could be depleted depending on how long you live.

OR

You could have a foot in each camp, if you are not retiring soon.

Dividends can be more reliable than share prices as they’re driven by
the companies performance itself and not by the whim of investors. As part of a total return / reinvestment strategy, this income could be
reinvested into income assets or back into the equity market
depending on the relative valuations.

The choice is yours my friend.