Where do we start with saving /investing?

Apodemus

bostonerimus wrote: »

"Make minimum payments on all debt".......is that good advice? I'd pay off all debt (other than a mortgage) before I proceeded beyond that box.

I guess that depends on your credit status. If you can fund emergencies through a credit card, your approach might make sense, but if you have zero access to credit, then the sensible approach would be to make sure that the minimum payments are handled and a minimal emergency fund started.

atush

bostonerimus wrote: »

"Make minimum payments on all debt".......is that good advice? I'd pay off all debt (other than a mortgage) before I proceeded beyond that box.

No thst isnt good advice- for someone who has an emergency fund of 10K.

Debt other than mtg should be paid off, if 0% debt then save into an interest bearing acct what you will use to pay it off later.

Wookey

Rowbo wrote: »

It doesn't mention paying off the mortgage though. It this a really bad idea?

Run your mortgage numbers thru an overpayment calculator to see if the gain is enough to warrant the extra payments you would need to make to clear it in 5 or 10 years, a lot will depend on if the base rate goes up or not in the coming years and how you would feel about that and it's impact.

I would look to start some form of pension for myself, even consolidation of any old ones you have into one larger pot, there is usually no charge for this but the pro's/con's need weighing up. As you are working there should be some form of workplace pension in place?

Rowbo

Thank you all. A closer look at our pensions is definitely worth it. I can see that paying more into the 40% tax payers pension makes sense. I hadn't really thought about my own pension. I just assumed we had pensions covered and should now look at other investments but it sounds like we need to look at this too. I'm just concerned that between these pensions and the LISA, we will tie up all of our savings long term. Maybe that's the sensible thing to do, it just doesn't feel right to not have access to any of it. I'll certainly have a think about this though. Thank you

Rowbo

Wookey wrote: »

Run your mortgage numbers thru an overpayment calculator to see if the gain is enough to warrant the extra payments you would need to make to clear it in 5 or 10 years, a lot will depend on if the base rate goes up or not in the coming years and how you would feel about that and it's impact.

I would look to start some form of pension for myself, even consolidation of any old ones you have into one larger pot, there is usually no charge for this but the pro's/con's need weighing up. As you are working there should be some form of workplace pension in place?

I hadn't thought of consolidating my existing pensions. I know nothing about pensions at all. I will certainly read up about this. Thank you.

Oh and I work for myself as a very part time reflexologist so no workplace pension.

System

Rowbo wrote: »

@Tarambor that's a great table. Thank you. Unfortunately I didn't end up in the 'spend it and enjoy' box but it was great to see that we are down in the final stages.

It doesn't mention paying off the mortgage though. It this a really bad idea?

"It depends."

Applying Spock like logic, if your mortgage interest rate is 2% and you can invest money and get a 5% return then your money is better spent investing than repaying the mortgage.

However the mortgage cannot be purely thought of in logic only monetary terms because it gives people a feeling of total security knowing they own all of their home and nobody can take it from them which for most people has a value which is priceless.

So I would say following the flowchart paying off the mortgage can come under "long term goal."