Hope is not an Effective Financial Strategy

shangaijimmy

Suffolk its reading peoples diaries, problems and musings on here that actually leads to lots of the research.

In terms of the potential draw dawn age changing, without extra salary sacrifice then 60 would be the minimum i'd be able to afford to get at it anyway (potentially 9 consecutive years with kids at uni taking me to 61!), and our initial plan was to use any S&S Isa savings to try and delay that by a further 1 or 2yrs. So I am working on the age of 60 for our calculations and then the new idea is that anytime where I am financially able to access the lump sum before 60 would be a bonus. Potentially the ISA may be a further buffer to help this as well, unless we use it for something else of course!

In relation to my salary I am working on approx 30% of my salary to pension, and a further 14% to investments. Mrs SJ pension is a fantastic final salary DB pension and is taking care of itself nicely. We are then able to add into a separate linked pot to boost her lump sum, which we have been doing for about 2yrs now. We currently put 4% into this, with the idea that we will increase it once we remortgage again with some of the cash freed up by our payments drop, or should she get a promotion now she is back in career mode.

Overall I always remind myself of the good position we are putting ourselves in with our financial responsibility. Fortunately neither of us are motivated by acquiring stuff, and spending on nothing. The biggest thing we try to buy for each other is 'time' itself.

Without any changes the very earliest we'd access anything and be able to partially retire is 60 for me. So anything else is a bonus. We will be MF before I am 52, and Mrs SJ is 49. Originally is was going to be 2036, so I am still very happy with the end of 2030, and hopefully with a decent retirement being accumulated that doesn't need use of lump sum to pay the remaining mortgage off!

Watty1

Used to gloss over such posts shangaijimmy ... now reading carefully

Busy_Mee1

Brilliant stuff SJ, I wish I had started this thinking as early as you have. Luckily for us we both have excellent DB pensions like Mrs SJ, we just needed to sort out the ginormous Mortgage and grind down some of outgoings.

I am glad you have clocked that the university years are some of the most expensive when you have children ( along with the pre-school years). We had one that did a five year course living away from home and one that did a 3 year course living at home. TBH both received the same level of financial support, as we funded a car for DD living at home, so she could get to Uni and her placements ( no buses where we live). I did actively encourage DS to go to a Northern Uni because the accommodation costs are much cheaper than those down South.

I know your kids are young now, but honestly it will feel like they are off to Uni in the blink of an eye.

shangaijimmy

It's so hard knowing what to do and focus on for best. I have no idea how those that just wing it manage to rest at night, and I am determined to guide our kids to be financially responsible.

Busy - Mentally I'm thinking that University support will be like having another 10yr left of a mortgage!!

Watty - read away, I'm merely pinching thoughts from others on here. I also have the support of my sister being a financial advisor. She was independent for a few years, but now is a pension specialist for people with obscene amounts of cash! So i get to run things by her, but in the main she just says "yes thats right, crack on!"

Busy_Mee1

In my experience those that wing it don't lose any sleep over their finances. I work with someone who is 58, still with another 7 years to pay on their mortgage, on which they are paying SVR. They also have £35k on credit cards, also at SVRs. They also buy 2/3 coffees a day, lunch in Pret and do their weekly supermarket shop in Waitrose/M &S.
When I suggested moving their Mortgage and CC borrowing to cheaper rates, they said it was too much hassle:eek:

I guess they won't be retiring early....still everyone makes their own choices in life

shangaijimmy

Interesting point Busy. I suppose if you are a 'winger' then you are unaware of what could be and bounded to working to the bitter end! I know for definite that I would be physically incapable of doing my job at 68. And if i managed to then I would be surviving and permanently exhausted!

Anyway onto other news. Just received a lovely e-mail from Green energy network to say we have a referral bonus heading to our current account. Happy days. So that's a bonus £25 (or it may be £30) heading to the mortgage :j Happy to provide a referral link should anyone be switching to them, as the switch bonus is for both as well...just offering...;)

greent

We probably need to be paying out around £600-650/ mth next year between our 2 at uni. Thankfully this will be the last year for a while with 2 there - then DS1 should finish the summer DS2 will start (who will finish just before DS3 starts, if he goes.... looking at a total of 16 years in one stretch if numbers 3 and 4 each go for 3 years - taking both of us to 60 (when we can access our DB pensions) Phew!

Am also a vanguard S&S balance addict

shangaijimmy

A stretch of 16 years...gulp... I hadn't really worked on the calculations for any 4,5 or 6 year courses as I think I'd cry!! I can hear my calculator and spreadsheet screaming at the thought!

greent

shangaijimmy wrote: »

A stretch of 16 years...gulp... I hadn't really worked on the calculations for any 4,5 or 6 year courses as I think I'd cry!! I can hear my calculator and spreadsheet screaming at the thought!

Steer them away from medicine and law type courses and post-grad stuff!

zcrat41

This is all a bit scary to those f us reading who've just finished the preschool years with relief! I thought the hard bit was behind us!