Pension?, mortgage?, investments?

Mish_Mash

I am a single female aged 35, I have no dependents. I have a final salary pension in which I have accrued 11 years of pension benefits equal to £7500. I anticipate that, if I stay with my company and complete 40 years of service, I would have a pension worth approx £40,000 (based on salary growth). However, this scenario is very unlikely and realistically I am targeting a retirement pension of 20k.

I am not paying any contributions into my pension (it's employer funded). I basically haven't been able to afford to pay any money into the pension. I have been working on the basis that if I continue to work for my existing company for 20 years (in total) I should have enough pension to cover me for retirement.

I have a large mortgage for which I have been saving and investing my cash and that has been the priority up until now.

However I am now a point where I have some money to put aside specifically for retirement savings and am wondering what I should do. My view has always been that (when I could afford it) I should invest any spare cash intended for retirement in investment funds so I can realise growth and retain easy access. The basis for this thinking is that I already have a good pension fund. But I am not sure that this is the right thing to do? Would the tax breaks I would get with a pension make this a more favourable option than investing in the stock market. Does anyone have any thoughts?

Note: I am a lower rate tax payer earning approx 42k a year. I would expect to become a higher rate tax payer sometime in the next year or 2.

My other quandry is that I have approximately 70k worth of savings (which are destined to pay off my mortgage) which is currently 180k and is an interest only tracker 0.9% above the bank of england base rate. I have been keeping this money in shares and SIP's (share investment isa's). I am intending to grow this amount to 100k over the next 3 years and then pay of a chunk of my mortgage before interest rates go up and my repayments become 'challenging'. I have made a reasonable amount on the stockmarket but am thinking that I am not maximising my returns as I lack specialist investment knowledge and also time to manage my money.

Ideally I would like someone to manage this money on my behalf but I am not sure there if there is a value in engaging a professional to do this. I am of the view that I need to have easy access to this money just in case I lose/leave my job or interest rates go up. I am just wondering if there are an savings/investment options that are short term rather than medium/long term and that might be suited to my requirements.

I suppose I am a little bit concerned that I have a lot of money sitting in an account just in case I need to bring my mortgage payments down quickly. It seems a wasted opportunity.

Any advice/thoughts would be appreciated.

bendix

Frankly, it doesnt sound like you need much advice. You're doing very well without advice already.

The only thing I would say is if that £70k is important and you don't want to take any risk to lose it and your plan is to pay a chunk off your mortgage with it when rates start to rise, you might want to look at the asset allocation of it from a short-term risk perspective and move more of it into cash or bonds, rather than shares.

Harry_Powell

As bendix has already said, you seem to be doing well financially. You're lucky to have a non-contributionary final salary and with an anticipated income of £20k (plus state pension), I doubt that you need to add to this.

If the size of your mortgage is causing you concern, then I'd look at blitzing this until you're in your comfort zone. Are you allowed to do unlimited overpayments? If not, then continue to put your money away until you are out of your current deal's redemption period and pay a lump sum off. Ensure you have sufficient emergency savings and that your house and income protection insurances are all up to date.

You need to think of an age when you will be looking to retire and then make sure that all your investments and mortgage repayments coincide with this date (i.e. if you want to retire at 60, get a pensions forecast from your employer and depending on what figure they come back with, top it up with S&S ISA investments).

Other than this, enjoy yourself, there is more to life than just savings, investments, pensions and mortgage. It's good to be ceareful but make sure you live a little.

Batchy

Mish_Mash wrote: »

I am a single female aged 35, I have no dependents. I have a final salary pension in which I have accrued 11 years of pension benefits equal to £7500. I anticipate that, if I stay with my company and complete 40 years of service, I would have a pension worth approx £40,000 (based on salary growth). However, this scenario is very unlikely and realistically I am targeting a retirement pension of 20k.

I am not paying any contributions into my pension (it's employer funded). I basically haven't been able to afford to pay any money into the pension. I have been working on the basis that if I continue to work for my existing company for 20 years (in total) I should have enough pension to cover me for retirement.

I have a large mortgage for which I have been saving and investing my cash and that has been the priority up until now.

However I am now a point where I have some money to put aside specifically for retirement savings and am wondering what I should do. My view has always been that (when I could afford it) I should invest any spare cash intended for retirement in investment funds so I can realise growth and retain easy access. The basis for this thinking is that I already have a good pension fund. But I am not sure that this is the right thing to do? Would the tax breaks I would get with a pension make this a more favourable option than investing in the stock market. Does anyone have any thoughts?

Note: I am a lower rate tax payer earning approx 42k a year. I would expect to become a higher rate tax payer sometime in the next year or 2.

My other quandry is that I have approximately 70k worth of savings (which are destined to pay off my mortgage) which is currently 180k and is an interest only tracker 0.9% above the bank of england base rate. I have been keeping this money in shares and SIP's (share investment isa's). I am intending to grow this amount to 100k over the next 3 years and then pay of a chunk of my mortgage before interest rates go up and my repayments become 'challenging'. I have made a reasonable amount on the stockmarket but am thinking that I am not maximising my returns as I lack specialist investment knowledge and also time to manage my money.

Ideally I would like someone to manage this money on my behalf but I am not sure there if there is a value in engaging a professional to do this. I am of the view that I need to have easy access to this money just in case I lose/leave my job or interest rates go up. I am just wondering if there are an savings/investment options that are short term rather than medium/long term and that might be suited to my requirements.

I suppose I am a little bit concerned that I have a lot of money sitting in an account just in case I need to bring my mortgage payments down quickly. It seems a wasted opportunity.

Any advice/thoughts would be appreciated.

Your single??? lol

as the previous poster said ... enjoy life... live a little.
Be prudent, but don't let it rule your life, when your 60 and feeling old and "slow" you will be thinking of all the things you could have done when you were in your 30s when you had perfect health...

good luck anyway hun :-)

DiggerUK

MishMash,
Seems sound to me, relax.
Sometimes a bit if fun needs to be put into the serious matter of savings. Some of that 70K could be in Premium Bonds.

Best of fortune.

bendix

DiggerUK wrote: »

MishMash,
Seems sound to me, relax.
Sometimes a bit if fun needs to be put into the serious matter of savings. Some of that 70K could be in Premium Bonds.

Best of fortune.

What lingering credibility you had on this forum has just completely disappeared.

chesky369

I recommend that you spend some of your money on Stella McCartney, Yves St Laurent and Jimmy Choos. Then have your hair cut regularly at John Freida (where they'll also do your nails and eyebrows). I'm sure you have lots of boyfriends already but go on holidays in exotic places and find some more.

Forget about the money. And especially forget about premium bonds - they're for boring old people like me.

chesky369

lots of boyfriends already ...........

or girlfriends of course.

DiggerUK

chesky369 wrote: »

Forget about the money. And especially forget about premium bonds - they're for boring old people like me.

Are you saying that Premium Bonds are the main source of excitement in your life as well.
Nearly the end of the month. Zippidy doo dah.

chesky369

...the main source of excitement in your life as well...

Jesus, no. I hope I cut my throat before that's true.

EdInvestor

Frankly, it's a bit pathetic when someone comes onto MSE who clearly has a good grasp on investment and finance generally, wanting some added value from those similarly interested, that the response of half the posters on the thread is not to worry your pretty little head about the numbers but go away and get a boyfriend or a pair of shoes.:rolleyes:


This is the kind of attitude that underpins the very widespread ignorance of financial matters that causes so much trouble in the UK.IMHO it is to be deplored.