Advice: Mortgage vs Pension?

deemex

I'm new to posting here so apologies if its in the wrong place and I would appreciate any advice.
Our situation: we are looking to buy (1st time) the house we currently rent from family for around £110,000. We have £14,000 saved and we want to save up to £27,500 for a 25% deposit. We are currently paying around £250 per month into our work pensions. Currently I think we can save around £750 per month meaning it would take around 18 months to have the deposit (before even considering the fees!).

Would we be better off in the long run stopping our pensions for now and concentrate on saving for the deposit and then making overpayments on the mortgage but having a lower pension when we retire
or
Continue paying into our pensions and taking a little longer to save for the deposit and making smaller overpayments on the mortgage?

dimbo61

The company pension also provides life insurance and may not let you rejoin if you stopped paying in !
You have a 10% deposit and there are some deals on the market with 90% LTV.
Check the websites and the bank you are with , local building societies or go see a whole of market mortgage broker.
If you get a mortgage think long term 5 years fixes gives you security GOOD LUCK

opinions4u

deemex wrote: »

I'm new to posting here so apologies if its in the wrong place and I would appreciate any advice.
Our situation: we are looking to buy (1st time) the house we currently rent from family for around £110,000. We have £14,000 saved and we want to save up to £27,500 for a 25% deposit. We are currently paying around £250 per month into our work pensions. Currently I think we can save around £750 per month meaning it would take around 18 months to have the deposit (before even considering the fees!).

Would we be better off in the long run stopping our pensions for now and concentrate on saving for the deposit and then making overpayments on the mortgage but having a lower pension when we retire
or
Continue paying into our pensions and taking a little longer to save for the deposit and making smaller overpayments on the mortgage?

What does your pension scheme give you?

- is it a final salary scheme or a money purchase scheme?
- for every £1 you contribute, how much does your employer pay in?
- does it provide you with life cover (e.g. 4 x salary)

I'd hate you to throw away a golden nugget.

RobertoMoir

deemex wrote: »

I'm new to posting here so apologies if its in the wrong place and I would appreciate any advice.
Our situation: we are looking to buy (1st time) the house we currently rent from family for around £110,000. We have £14,000 saved and we want to save up to £27,500 for a 25% deposit. We are currently paying around £250 per month into our work pensions. Currently I think we can save around £750 per month meaning it would take around 18 months to have the deposit (before even considering the fees!).

Would we be better off in the long run stopping our pensions for now and concentrate on saving for the deposit and then making overpayments on the mortgage but having a lower pension when we retire
or
Continue paying into our pensions and taking a little longer to save for the deposit and making smaller overpayments on the mortgage?

I strongly suggest you get specialist advice on something like this, rather than make a decision based on the opinions of random interweb people who haven't got the time or information needed to make an informed suggestion.

dunstonh

We are currently paying around £250 per month into our work pensions.

Which actually means £200 if you cancel due to tax relief. Its possible your NI would go up as well.

If the employer is matching contributions then you are losing another £250 pm there as well. If its final salary, the loss will even be greater.

but having a lower pension when we retire

State pension is £4900 a year and the state pension age is increasing to 68. Retirement planning isnt really optional unless you plan to be poor in retirement and £250 gross into a pension isnt a particularly large contribution.