what comes first?

Seanymph

I have started the panicking because of our impending retirement ages (OH is 52 and I'm 46). And I we have no savings at all. I am finding it very hard to work out how to move forwards.

I have a pension, OH doesn't - and we have three houses.

We also have a mortgage on one of them, and owe about 6k still on the car.

Now I am keen to get on with puggling money away for our retirement, but I'm getting nowhere. I had saved some - which was used for a new septic tank for our renovation project in France. Then what I had saved over the next few months went on the new car.

I have HUGE projects at the houses (all houses seem to cost a fortune) - but it doesn't further my cause towards retirement.

So, finally my question:

Do I pay off the car (my plan) - clear the mortgages - or start puggling it away again? And how do I get my new block paving driveway and garden landscaping done?

The dream is that I would like to have an investment portfolio behind us, and possibly a buy to let or two by the time we have to cut down on working.

Bit ambitious I know - but, I need something to aim for and currently I don't know where to start - it seems every time I get some money put away we end up spending it on something else.

So, how do you prioritise to enable you to get savings and investments?

And where would you start in my situation please?

Linton

I think you start with a basic plan....

- How much income do you need in retirement? As a default use your current annual expenditure plus tax minus anything you wont need to spend once retired.
- How much income will you get from known sources - eg state pension, final salary pensions?
- what is the difference?

Where is it going to come from?

Why do you have 3 houses? If you were to sell the ones you arent living in, is the money sufficient to provide the extra income you need?

Once you have some basic figures sketched out you will have a better idea of when you will be able to afford to retire and how much you need to save. You can then be able to decide whether you really want the new driveway and landscaping.

atush

Oh dear, we are a bit late aren't we lol.

Anyway. Questions (the asnwers to which will help with adivce to you) Dependents?

How did you end up with 3 houses? You have one in france, presumably one in the UK- where is the other? WHat income does it bring in and what is the value and costs? Why 3 properties an no pension? Dont get me wrong property is fine, but I didnt' get my scond until I had a pension going much less my own 3rd one.

How do 2 earning people have no savings at your age? Why does the OH not have a pension?

Why do your savings pay for all repairs/improvments? Does not sound like a good, equitable plan unless you are sole woner of said property..

Seanymph

I feel a bit better from reading the 'what people have' thread, it's given me a better idea of spreading money - but here are my answers so you can help me specifically if possible.

We have five children - 17 through 22. Two have left home, two at university (one away one at home) and one is an apprentice (at home).

One house is mine, one is OH's and one in france is ours for a holiday home.

We derive no income from any of them - France is a renovation, OH's eldest son lives in his, and we live in mine.

France value £65, mine £220, his £150. (all ,000). We have one mortgage about £80k against his house and 6k outstanding on the car.

erm, why no savings? I guess the short answer is we've spent it as we've gone along for various reasons.

OH is pension averse. I just never bothered until recently.

I now don't want to spend it as we go along - I'm having a real 'wake up' spell about wanting to do things when we are older, and not feeling too secure about money day to day - so I'm trying to work out my best way forwards.

And this is always a great place for opinions, and I really feel I need some...

(*I say 'I' paid for things - but it's all shared money in our house - I puggle it away because OH has no interest in money at all)

planteria

"puggle":T

good to see that you are making a plan. there is lots of useful information here, and plenty of people who can help.

starting to build pension pot(s) looks like a priority to me, but you could, perhaps, use ISAs instead/alongside.

Seanymph

Thanks planteria - I have a pension at work (I work part time only) and for every 6% I pay in my employer pays 18% - but if I overpay they don't match fund it, so it seems better to me to leave it at the rate it currently is and use my money elsewhere.

I could of course be wrong about that (I've only had it a year or so) but to 'add' extra years costs loads, I did check it out - and then you can't get it back, so I thought I'd rather have it somewhere I could access it. My problem then is we keep accessing it to do things.

planteria

Seanymph wrote: »

Thanks planteria - I have a pension at work (I work part time only) and for every 6% I pay in my employer pays 18% - but if I overpay they don't match fund it, so it seems better to me to leave it at the rate it currently is and use my money elsewhere.

I could of course be wrong about that (I've only had it a year or so) but to 'add' extra years costs loads, I did check it out - and then you can't get it back, so I thought I'd rather have it somewhere I could access it. My problem then is we keep accessing it to do things.

well, your 6% which becomes 24% is a clear winner. you need to take advantage of that.
whether further pension contributions suit your circumstances is another matter. i can see the logic of leaving at that, and investing elsewhere...but perhaps locking some more money away from yourself is actually what you need?:A
also, pension contributions can reduce tax by bringing employees below thresholds, etc. but i don't think that is the case here.

Seanymph

oh no, I'm well below thresholds!

I like the 'locking away' idea though, simply because if I can get at it we tend to spend it, but not so 'locked away' that I can't get it in a crisis.

Tiglath

Do you get rent from the eldest son living in your OH's house?

Seanymph

No - he has paid for improvements and things but he doesn't have a tenancy as such.

grey_gym_sock

it is fine to help children with housing, but is eldest son living in OH's house an efficient way to do it? is it more of an accidental arrangement (e.g. OH moved out, son stayed there)? is the house bigger than he needs?

other options include: sell the house to son, perhaps for a discount to its actual value (with him taking out a mortgage), freeing up some cash which can be invested.

or: sell the house, give son part of the proceeds (which he might use as a deposit on a cheaper or more suitable property), and invest the rest.


or: just kick son out. you don't have to subsidize his housing.

i'm not saying what you/OH should do. but do think about what you're doing. currently you're effectively donating the rental value of the house, less what son contributes to improvements, to son.