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  • FIRST POST
    • BOBS
    • By BOBS 19th Feb 17, 10:38 PM
    • 2,679Posts
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    BOBS
    Savings for rainy day / retirement / happiness
    • #1
    • 19th Feb 17, 10:38 PM
    Savings for rainy day / retirement / happiness 19th Feb 17 at 10:38 PM
    I read lots of diaries on here about people who struggle with debt and admire how they approach it with such positiveity !!
    I always seem to be worrying about money but really don't know if I need to be when I compare our household.

    Family of 5 - 2 adults (both mid 40's) 3 kids, with joint income around £35k
    ISA savings between us of about £25k and we jointly put around £700 a month in unless something big crops up.
    We have a mortgage of around £12,000 left (house worth £150,000) so really no big deal, and car loan of around £6,000 and enough money to usually pay off what we put on credit cards here and there.

    DH has work pension of about 4 years running, I am S/E and dont pay pension - more for personal reasons than anything. I prefer to have easy access to what money we have available. Though on the back of this we still want to have some money put by for retirement funds.
    I did pay into a pension about 15+ years ago for about 5 years but dont really have any info on this, and DH has another 2 or 3 smallish pensions from other places he worked.

    After typing this I know it looks good on paper but I still cant stop doing spread sheets and forecasts. Is this a normal set of circumstances ??
    Any words of wisdom or do I just need a good kick up the !!!!
    Last edited by BOBS; 20-02-2017 at 8:47 AM. Reason: aa
Page 1
    • Thrugelmir
    • By Thrugelmir 19th Feb 17, 10:51 PM
    • 54,851 Posts
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    Thrugelmir
    • #2
    • 19th Feb 17, 10:51 PM
    • #2
    • 19th Feb 17, 10:51 PM
    I am S/E and dont pay pension - more for personal reasons than anything. I prefer to have easy access to what money we have available.
    Originally posted by BOBS
    Not sure what personal reasons you can have for contributing absolutely nothing into a pension scheme for yourself. When do you hope to stop working?
    “ “Bull markets are born on pessimism, grow on skepticism, mature on optimism, and die on euphoria. The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell.” Sir John Marks Templeton
    • BOBS
    • By BOBS 19th Feb 17, 10:55 PM
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    BOBS
    • #3
    • 19th Feb 17, 10:55 PM
    • #3
    • 19th Feb 17, 10:55 PM
    Not sure what personal reasons you can have for contributing absolutely nothing into a pension scheme for yourself. When do you hope to stop working?
    Originally posted by Thrugelmir
    Basically my close family members have not lived long enough if at all to enjoy what pensions they may have slogged long and hard for. I am well aware that this may not happen me but if push came to shove with a diagnosis I would like to have access to my ££. Probably sounds totally stupid to most but its how I deal with it.
    • xylophone
    • By xylophone 19th Feb 17, 11:29 PM
    • 22,396 Posts
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    xylophone
    • #4
    • 19th Feb 17, 11:29 PM
    • #4
    • 19th Feb 17, 11:29 PM
    After typing this I know it looks good on paper
    I'm afraid that from the point of view of retirement provision it really doesn't.

    https://www.gov.uk/new-state-pension/eligibility

    I did pay into a pension about 15+ years ago for about 5 years but dont really have any info on this,
    You might consider checking on this.

    and DH has another 2 or 3 smallish pensions from other places he worked.

    What type of pensions?
    • kidmugsy
    • By kidmugsy 19th Feb 17, 11:57 PM
    • 9,467 Posts
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    kidmugsy
    • #5
    • 19th Feb 17, 11:57 PM
    • #5
    • 19th Feb 17, 11:57 PM
    Basically my close family members have not lived long enough if at all to enjoy what pensions they may have slogged long and hard for. I am well aware that this may not happen me but if push came to shove with a diagnosis I would like to have access to my ££. Probably sounds totally stupid to most but its how I deal with it.
    Originally posted by BOBS
    Your husband and children might be grateful if you paid into a pension even if you were to die early.

    if you think that waiting about ten years before the money becomes available is too long, at least promise yourself to look at the matter again in five years time.

    P.S. Do get an estimate of your eventual State Retirement Pensions.
    Last edited by kidmugsy; 20-02-2017 at 12:00 AM.
    • Apodemus
    • By Apodemus 20th Feb 17, 7:19 AM
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    Apodemus
    • #6
    • 20th Feb 17, 7:19 AM
    • #6
    • 20th Feb 17, 7:19 AM
    Family of 5 - 2 adults (both mid 40's) 4 kids...
    Originally posted by BOBS
    I think there is something wrong with the "sum" function in your spreadsheet!
    • BOBS
    • By BOBS 20th Feb 17, 7:47 AM
    • 2,679 Posts
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    BOBS
    • #7
    • 20th Feb 17, 7:47 AM
    • #7
    • 20th Feb 17, 7:47 AM
    I think there is something wrong with the "sum" function in your spreadsheet!
    Originally posted by Apodemus
    haha , no butterfingers - 3 kids, maybe my heading adding in our mutley dog !!

    Kidmugsy - I did get state pension forecast - somewhere around £160 mark -all NI payments made.

    Xylophone - I have no idea how to go about even checking my work pension. It was through admin work in an NHS department which is no longer there. Husbands gets pension updates from his previous companies - they dont add up to an awful lot - around £6k in one and £5k in another.... but will still be therefore for some treats I expect.
    • ChesterDog
    • By ChesterDog 20th Feb 17, 8:23 AM
    • 756 Posts
    • 1,302 Thanks
    ChesterDog
    • #8
    • 20th Feb 17, 8:23 AM
    • #8
    • 20th Feb 17, 8:23 AM
    https://www.pensionsadvisoryservice.org.uk/pension-problems/making-a-complaint/common-concerns/lost-pensions
    I am one of the "Dogs of the Index".
    • Linton
    • By Linton 20th Feb 17, 8:33 AM
    • 8,089 Posts
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    Linton
    • #9
    • 20th Feb 17, 8:33 AM
    • #9
    • 20th Feb 17, 8:33 AM
    When do you think you will retire?
    How much income will you need in retirement to have a reasonable standard of living?
    Where is the income going to come from?

    I suggest you use your apreadsheets to help you answer these questions.

    Information to guide your thoughts from ONS data:
    - a woman of average health aged 45 thius year is be expected to live until her early 90's. A man a couple of years less.
    - Once you reach 65 you are more likely to live to 100 than die by 75.
    • DiggerUK
    • By DiggerUK 20th Feb 17, 9:47 AM
    • 2,729 Posts
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    DiggerUK
    Why hang on to the debts
    If you cleared the two big debts you mention, you would still have a rainy day fund left.
    That would leave you with far more than the £700 a month to plan what to do with, and a secured roof over your heads to boot..._
    I am not now, nor have I ever been, a Financial Adviser.
    Forward, to the 'British Spring'
    • badger09
    • By badger09 20th Feb 17, 11:47 AM
    • 5,112 Posts
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    badger09
    OP

    In addition to what others have said about pension provision, can I ask whether you are saving in Cash ISAs or S&S ISAs?

    Cash ISAs are paying very low rates these days but you could both be achieving up to 6% on your savings by using current accounts and regular savers. You and your husband can earn interest up to £1k tax free, so no need to use Cash ISAs.

    However, once you have your emergency fund in cash savings, it makes sense to invest, rather than save. Investments in a pension tax wrapper attract tax relief - ie free money Investments in S&S ISAs give tax free returns and over the long term are likely to give you much better returns than simple cash savings.
    • jimjames
    • By jimjames 20th Feb 17, 12:14 PM
    • 11,940 Posts
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    jimjames
    Basically my close family members have not lived long enough if at all to enjoy what pensions they may have slogged long and hard for. I am well aware that this may not happen me but if push came to shove with a diagnosis I would like to have access to my ££. Probably sounds totally stupid to most but its how I deal with it.
    Originally posted by BOBS
    In which case just invest using a S&S ISA instead so you have immediate access to the money if you really don't want to use a pension. No tax relief on way in but that probably isn't a massive issue based on your salary as it would be tax free coming out.
    Remember the saying: if it looks too good to be true it almost certainly is.
    • BOBS
    • By BOBS 20th Feb 17, 12:22 PM
    • 2,679 Posts
    • 2,007 Thanks
    BOBS
    OP

    In addition to what others have said about pension provision, can I ask whether you are saving in Cash ISAs or S&S ISAs?

    Cash ISAs are paying very low rates these days but you could both be achieving up to 6% on your savings by using current accounts and regular savers. You and your husband can earn interest up to £1k tax free, so no need to use Cash ISAs.

    However, once you have your emergency fund in cash savings, it makes sense to invest, rather than save. Investments in a pension tax wrapper attract tax relief - ie free money Investments in S&S ISAs give tax free returns and over the long term are likely to give you much better returns than simple cash savings.
    Originally posted by badger09
    We Just have normal cash ISA's.
    Wouldn't know where to start re investing money for a good return. With amount involved employing an advisor would wipe out any money earned on interest.
    • jimjames
    • By jimjames 20th Feb 17, 12:52 PM
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    • 10,341 Thanks
    jimjames
    We Just have normal cash ISA's.
    Wouldn't know where to start re investing money for a good return. With amount involved employing an advisor would wipe out any money earned on interest.
    Originally posted by BOBS
    So DIY then. Have a look at www.monevator.com to get started. It's no different to choosing a pension and presumably you looked into them to be correctly informed and to make your decision about not using them?
    Remember the saying: if it looks too good to be true it almost certainly is.
    • xylophone
    • By xylophone 20th Feb 17, 1:03 PM
    • 22,396 Posts
    • 12,918 Thanks
    xylophone
    It was through admin work in an NHS department which is no longer there.
    You may well have a deferred NHS pension - check!

    http://www.nhsbsa.nhs.uk/Documents/Pensions/member_Deferred_Benefits_V2.0_07.2013.pdf

    Husbands gets pension updates from his previous companies - they dont add up to an awful lot - around £6k in one and £5k in another....

    What kind of pension are they?

    https://www.gov.uk/pension-types

    New state pension forecast for each of you here

    https://www.gov.uk/check-state-pension
    • atush
    • By atush 20th Feb 17, 1:24 PM
    • 16,160 Posts
    • 9,852 Thanks
    atush
    Basically my close family members have not lived long enough if at all to enjoy what pensions they may have slogged long and hard for. I am well aware that this may not happen me but if push came to shove with a diagnosis I would like to have access to my ££. Probably sounds totally stupid to most but its how I deal with it.
    Originally posted by BOBS

    You cant really use family members for your LE if their early deaths had mroe to do with lifestlye than faulty genes?

    In any case, pensions are good for those who die early- as your family will get the money tax free.

    So dont use that as an excuse.

    Ypu will have a PA to take income tax free in retirement, so it would be best to have some pension income to use up this allowance.

    And do get in touch with your old pension administrators. You need this information to help you plan your retirement.
    • atush
    • By atush 20th Feb 17, 1:26 PM
    • 16,160 Posts
    • 9,852 Thanks
    atush
    We Just have normal cash ISA's.
    Wouldn't know where to start re investing money for a good return. With amount involved employing an advisor would wipe out any money earned on interest.
    Originally posted by BOBS
    I agree, look at the monevator website and start reading. Start with the Compounding returns post.

    You could open a S&S isa or sipp and just pay into a global tracker for now.
    • BOBS
    • By BOBS 21st Feb 17, 6:38 PM
    • 2,679 Posts
    • 2,007 Thanks
    BOBS
    You may well have a deferred NHS pension - check!

    http://www.nhsbsa.nhs.uk/Documents/Pensions/member_Deferred_Benefits_V2.0_07.2013.pdf




    What kind of pension are they?

    https://www.gov.uk/pension-types

    New state pension forecast for each of you here

    https://www.gov.uk/check-state-pension
    Originally posted by xylophone
    Have been doing a bit of digging - definitely no paperwork relating to my own pension - have contacted hsc pensions - which I hope is the correct place....... time will tell.... pension always referred to as Superan ....
    Re DH Pensions there seems to be 3 of them.
    - first one through Enhance has £536 sitting in it !
    - Another Scottish Widows shows transfer value of £14500 and yearly pension of £768
    - Current one by standard life - DH has paid in about £2000, statement says final plan value is £12100 giving pension of £312/ year - which doesnt seem correct ??
    • Linton
    • By Linton 21st Feb 17, 8:27 PM
    • 8,089 Posts
    • 7,909 Thanks
    Linton
    Have been doing a bit of digging - definitely no paperwork relating to my own pension - have contacted hsc pensions - which I hope is the correct place....... time will tell.... pension always referred to as Superan ....
    Re DH Pensions there seems to be 3 of them.
    - first one through Enhance has £536 sitting in it !
    - Another Scottish Widows shows transfer value of £14500 and yearly pension of £768
    - Current one by standard life - DH has paid in about £2000, statement says final plan value is £12100 giving pension of £312/ year - which doesnt seem correct ??
    Originally posted by BOBS
    The pension estimates could be correct if the SW one is for a fixed annuity whilst the SL one is inflation linked. Or one may be at current prices and the other in cash terms. Add in State Pension. Are you happy to spend the final quarter of your life on this level of income?
    • BOBS
    • By BOBS 22nd Feb 17, 8:39 AM
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    BOBS
    The pension estimates could be correct if the SW one is for a fixed annuity whilst the SL one is inflation linked. Or one may be at current prices and the other in cash terms. Add in State Pension. Are you happy to spend the final quarter of your life on this level of income?
    Originally posted by Linton
    I cant quite understand the SL policy how come if value is £12100 it only gives pension of £312/ year ?
    Re level of income - with current level of savings, allowing this to increase when mortgage clear we should have put past hopefully well over £200k which when added onto DH pension, and state pension should do us nicely. We currently bring up 3 kids on joint income of £35k
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