Even more confused what to do now!

toby_puppy

Bit of a late starter here with pensions etc - since I last posted for advice there seems to be a lot of changes made re. pensions so am just looking for up to date advice please.

I will be 43 this year and have no pension as such. (well one that will pay me £100 per year when I retire with Scottish Life, so not worth mentioning!)

I work full time and bring home £1595 per month. I did a statement of assets and liabilities and there seems to be around £300 per month left over. (although in reality that could be as low as £200 per month, depending on what comes up, ie car or house repair).

I have a mortage of £50k (house worth around £105k) with repayments of £350 per month fixed for five years. Mortgage will be paid off in 2029.

I have around £2000 of cash savings.

I do have a partner who earns roughly the same as me (but he has a bit more debt to sort out). He has a final salary pension with a former employer that says its worth around £30,000 - does anyone know how much he would get if he was able to draw out of it? He is 50 this year.

Basically, I have this £200 - £300 per month I want to save and I was about to think of stocks and shares isas because I kept reading that pensions werent so good for low-mid earnings paying basic rate tax but now it seems that everything is swinging back towards pensions.

It all seems a bit worrying when you want to save but are worried you will make the wrong choices and end up with next to nothing.

kidmugsy

toby_puppy wrote: »

I have around £2000 of cash savings.

I do have a partner who ... has a final salary pension with a former employer that says its worth around £30,000 - does anyone know how much he would get if he was able to draw out of it?

If it really is a Final Salary pension then there will be an official estimate of the pension he'll get: in other words don't ask us, ask them. It may be in paperwork you already have.

As for yourself, I'd suggest that you might want to build up your emergency cash first. By the time you've done enough of that the pension reforms should have passed into law, with any modifications that they may make. That will be a good time to reconsider.

toby_puppy

Ok, thank you. We did see some paperwork with a value figure of £30000 on it but as he only worked there for around 6 years, I would assume it will be a very meagre monthly pension amount this will generate but we will try and find some more info.

how much do you suggest I have as an emergency fund - and would this be best in a cash isa?

thanks

kidmugsy

toby_puppy wrote: »

Ok, thank you. We did see some paperwork with a value figure of £30000 on it but as he only worked there for around 6 years, I would assume it will be a very meagre monthly pension amount this will generate but we will try and find some more info.

how much do you suggest I have as an emergency fund - and would this be best in a cash isa?

thanks

People often suggest an emergency fund of 3-6 months worth of outgoings. It must depend, I'd think, on how secure your job is.

In principle Cash ISAs would be a good place to keep it, but they pay dismal interest rates at the moment. There are interest-bearing current accounts that pay more, even after tax.

atush

In your case, starting so late, i'd put 200 a month into pension, then save what is left over (ie the 100) into your emergency pot. Esp as I thinl from another post, your employer contributes? You really cannot afford to throw away fee money and need to join today.

Go over all your spending and see where you can trim it- esp your OH as he needs to snowball his debt gone. Then he needs to join his employers pension if they have one. IF they don't, after debt is gone he needs to slam in every penny he has spare into a pension. When he takes this money, he can put it into a Nisa then.

xylophone

Your husband has a deferred Final Salary Pension. He should have (or be able to obtain), a Scheme Booklet which will tell him about how his pension increases in deferment and the earliest age he can request access to his pension benefits - this is likely to be 55 with actuarial reduction.
http://www.barnett-waddingham.co.uk/news/2012/07/revaluation-for-early-leavers/ might be worth a look.

Do your employers offer a pension scheme? If not, they will soon have to.
https://www.gov.uk/workplace-pensions

Re state pension https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/181237/single-tier-pension-fact-sheet.pdf