to save or not to save?

claz

hi just wanted some advice really as i don't have a clue about pensions etc

i am 19 and my partner is 27 and we are home owners with mortgage etc, we are currently doing up the house (or should i say gutting it) and so don't have a lot of money

however, me being mrs organised and all that started thinking about pensions etc i know retirement is a long way off but should we be thinking about starting to put money away and if so where the best place?

many things are probably going to happen in the "future" kids hopefullly we have even discussed living in new zealand

should we wait it ut or start now

thanks in advance:A

margaretclare

Hi

Saving is essential for everybody. Everybody, without exception! If you have no savings to start with, the very basic need is for some 'rainy-day' money which you stash away and forget about until something urgent arrives, as it surely will. Household appliances break down, the car needs a new battery, once you have a house it's amazing the number of things it needs.

Your question doesn't specifically relate to pensions - you ask 'to save or not to save?' If you don't save, where are you going to find money for all those unexpected costs? You're going to have to borrow it, that's where. And as many, many people here will tell you, that can be the start of a very slippery slope indeed.

Both of you could open a cash ISA - that would be a very good place to start. Look for one which is paying at least 4.50%, preferably 4.80% or 4.90%.

Best wishes

Margaret Clare

EdInvestor

Hi claz

I have news for you. You're already saving.:) Buying a house is counted as saving by economists, as you're borrowing money to buy an asset which appreciates in value.That's different from borrowing money to spend on things like eating out, or holidays, which have no value - that's just getting into debt.

Saving is undoubtedly a Good Thing. A rainy day fund in a cash ISA as Margaret says is step one.

Assuming you are both working, you have probably already accumulated some entitlement to the 2 state pensions.

Get a pension forecast here - it's worth checking every year.

The state pensions are a valuable benefit - you would have to save up nearly 200,000 quid to get the same income through an annuity these days :eek: Not to be sneezed at.

If you're think of moving overseas, it's probably not worth starting up a private pension, because once you put money in a pension you can't get it out until you're 55, and then only some of it.

What you could do is use the other half of your ISA allowance, which is earmarked for investments - that's 4k a year.You can invest in the same kinds of things you would in a pension if you use that.And then if you do decide to emigrate, you can take the money with you.