pension advice much appreciated

ukjoel

excelpaul wrote: »

I am just impressed that somebody with 4 children on £50k gross a year can overpay a mortgage by £400 a month and save another £200 into an ISA. £50K a year gross after tax and NI must be about £37000.


V.

Its possible (some would say easy but that sounds a bit cheeky) but depends on other priorities.

A 150k house these days sounds very cheap so presume not in the South East, especially if its of size to house 4 kids. A 90k mortgage at 4% is about £350 per month so £760 with overpay and the ISA makes £960.

on a 50k gross take home would be about 36k or 3k a month plus the £200 a month from child benefit.

So even after paying mortgage and ISA OP still has £2200 to cover bills, food, and other stuff.


My advice (and I am in similar position to OP) would be to put ALL the money you earn from the 40% tax band into pension. Check to see if your company offers salary sacrifice and you will hardly notice its not being paid to you.

dessssss

ukjoel wrote: »

Its possible (some would say easy but that sounds a bit cheeky) but depends on other priorities.

A 150k house these days sounds very cheap so presume not in the South East, especially if its of size to house 4 kids. A 90k mortgage at 4% is about £350 per month so £760 with overpay and the ISA makes £960.

on a 50k gross take home would be about 36k or 3k a month plus the £200 a month from child benefit.

So even after paying mortgage and ISA OP still has £2200 to cover bills, food, and other stuff.


My advice (and I am in similar position to OP) would be to put ALL the money you earn from the 40% tax band into pension. Check to see if your company offers salary sacrifice and you will hardly notice its not being paid to you.

To be exact I have 18 years left on my mortgage and the correct rate is 4.59.
I pay 1000 pounds per month of which 365 pounds is over payment.
I work in the south east but live in the West Midlands so I do have extra costs.
Take home is around 37K per year.
Salary sacrifice I dont think is an option.

Is there any good sites where i can read how to set up a SIPPS.
How do i claim the tax back etc?

robin61

dessssss wrote: »

That sounds promising.
Where do I start and how do I achieve 5% interest in these times

To be honest all of my extra pension contributions are going into as cash fund in my company AVC. But I am planning to retire in 3 years so I am happy making just the 40% I get from the tax relief (no risk so close to retirement for me). You have longer to go than me so you need to be investing in the stock market to try to get decent growth. I couldn't really recommended which scheme would be the most likely to achieve the kind of growth you need.

xylophone

No company pension? When will one be offered? See https://www.gov.uk/workplacepensions?gclid=CK_tjvmm_LUCFczHtAodwR4AJQ

And check the effect that paying into a pension would have on any tax credits for which you might be eligible.

Regarding CB and pension see https://forums.moneysavingexpert.com/discussion/5030662 post 7

And if your employer's staging date is not for a couple of years,

http://www.cavendishonline.co.uk/pensions/

http://www.thisismoney.co.uk/money/pensions/article-2391205/When-start-saving-pension.html

And re single tier state pension for which the legislation has now been passed https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/181237/single-tier-pension-fact-sheet.pdf

atush

dessssss wrote: »

Yes I know I have to plan for retirement.
Its why I'm asking questions here.
I wonder what standard of living my wife and I would have if I started to invest a quarter now.

Your standard of life will improve if

a- you stop having children and

B- your wife goes back to work when youngest is in nursery/school and

c- you start a pension with that 400 a month money.

Did you know, that each 100 into a pension will cost you only 60? How can you do better than that in your isa? How will that severly impact your standard of living given you are being taxed at 40% on at least 8K?

Your standard of life will DECREASE dramatically in future if you dont start saving for your pension now.

dessssss

atush wrote: »

Your standard of life will improve if

a- you stop having children and - Stopped

B- your wife goes back to work when youngest is in nursery/school and - That's a possibility

c- you start a pension with that 400 a month money. - I will start a pension very shortly. Should i not do both ( pension and over payment )?

Did you know, that each 100 into a pension will cost you only 60? How can you do better than that in your isa? ( isa is really a savings pot ) How will that severly impact your standard of living given you are being taxed at 40% on at least 8K? - great point

Your standard of life will DECREASE dramatically in future if you dont start saving for your pension now.

- yes

Hope that's all readable