People in their 30's - future financial plans?

somethingcorporate

Tom_Brine wrote: »

Thanks.

The sharesave scheme is a no lose situation. If the share price bombs I can take the cash. The plan will be to use the 4026 shares that I get access to in 2021 to either pay a huge chunk off of the mortgage, extend or improve the property, and or invest into my ISA in a different fund. Whatever happens the sharesave shares are in line for a quick sale when they mature.

The £150 a month of SIP shares will be kept long term, I have to hold them for 5 years for them to be able to be sold tax and NI free. I see them as a slow burner in the background, reinvesting the dividends and will take stock of the situation in 5-10 years time, thats assuming I am still working for the same company. I have another promotion/move in me yet.

Very similar position to me. I am putting mine aside for school fees but selling/diversifying when I can.

I 100% agree these share schemes are almost impossible to lose on given the tax advantages, dividend shares etc. The only difficulty is watching a paper profit go up in smoke really quickly!

ruperts

Hutchch0920 wrote: »

This is an incredible position to be in, I am starting to wonder where I've gone wrong and how I can put myself on a better trajectory for the future. May I ask what sectors you work in?

The type of people being candid about their position in this type of thread is always going to be heavily skewed towards those in very good positions. The average pension pot held by people in their 30’s is not a lot (£14k according to one estimate).

It’s pointless comparing yourself to others anyway really as your preparedness for retirement depends entirely on your own retirement lifestyle expectations and how much it will cost. Some people want all the premium bells, whistles and status symbols, others are perfectly happy with none of that.

JoeCrystal

ruperts wrote: »

The average pension pot held by people in their 30’s is not a lot (£14k according to one estimate).

Well, that is darn depressing. Maybe I am doing better than I thought I was, relatively speaking. Stumbling across this forum was the best thing I ever did for my financial future!

Mogley

Myself and OH are 36 with three DD's. Financial Situation is:
- Salary of £50k and OH at £21k (part time).
- Workplace pension of 6% employer, 12% employee (6% required to get 6% matched). OH DB pension as civil servant.
- Mortgage £130k on £200k lifetime house. Part on 2+%BOE variable, other part on 2.79%fixed.
- £2k in S&S ISA, £3k in cash savings, £1k of overpayment reserve, £27k stooze pot (recently started to earn additional £750/yr).
- Current pension pot of £51k (started late with this in 2010).


Our situation has changed significantly in the past two years regarding me having a new job, our 3rd child arriving and the OH working part time. It has become quite difficult to effectively manage the finances during these changes.
The plan is to continue to save in Cash to boost emergency fund, continue to contribute to JISAs and continue to slowly top up S&S ISA as this is the future life fund (DD university, DD house deposit, pension top up etc). I am currently happy with my pension contributions which I am hoping to use to retire at 65 and lead a modest life (not depending on state pension).
You can tell by my number of posts that it is only relatively recently I have started using these forums to change from being in debt (kids are expensive) to starting to save.

somethingcorporate

ruperts wrote: »

It’s pointless comparing yourself to others anyway really as your preparedness for retirement depends entirely on your own retirement lifestyle expectations and how much it will cost. Some people want all the premium bells, whistles and status symbols, others are perfectly happy with none of that.

You can miss out the bolded word and it still be accurate. I make a large lifestyle sacrifice to pour cash into the pension (to the tune of £1000 cash at least pm). It's all about compromise.

Thrugelmir

adonis10 wrote: »

worse pensions,

Many of us spent working years building our own pots as well. Not everyone has the benefit of a lifetime working in the public sector or for a company offering a DB scheme.

adonis10

JoeCrystal wrote: »

Well, that is darn depressing. Maybe I am doing better than I thought I was, relatively speaking. Stumbling across this forum was the best thing I ever did for my financial future!

Isn't it just! I fit this bill - 34, 15k in pension provision, hence why I am now desperate to catch up.


A point about not prioritising mortgage overpayments that a lot of people advocate - it is inevitable that rates are going to rise so is it not better to get ahead of the game and start overpaying now?

Drp8713

I am turning 30 later this month unfortunately.

Salary £38k, I have the following so far:

LGPS £4k per annum and AVC of £2k, contribute £250 per month.
S&S ISA/S&S LISA/IFISA/SIPP £21k, contribute £750 per month.
Premium Bonds £5k emergency fund.

My wife (also 30) and earns a bit less pays into the RPS and BRASS, she also has a S&S ISA/S&S LISA/SIPP worth £6k and pays £110 per month.

Our rent is £9k a year but to buy a similar house would cost £450k. At those valuations I am not interested in buying. A house price crash could change our minds (expensive part of London).

I dont know if I am doing well based on this thread! If you value the DB pension at 20 times then I am worth over £100k and doing alright, if you take it at face value it all looks a bit meager.

That being said now im up to £750 per month the investments should start to grow a bit faster.

RichyRich

Thanks for this thread. I turn 32 later this year and am trying to balance multiple goals, namely that I want to retire (or at least have the option to) at 55, I want to pay off the mortgage, and keep some money readily available for emergencies.

I'm given to believe that the pension rules are changing to track the state retirement age by 10 years which kyboshes the idea of being able to draw my company pension at 55 so I've started an S&S ISA which doesn't have the same tax benefits as a pension but gives me the flexibility to leave work before I can draw my pension.

I currently earn in the low 60s and contribute 10% into my employer's defined contribution pension scheme by salary sacrifice. My employer puts in 8%. Total pot size around £75k. I plan to put this up to 11% next year (banking on a pay rise in February; of course I have to pick my contribution level before I get told whether I get a pay rise or not. I went from 9% to 10% last year and then didn't get one!). Have about £20k in cash spread among regular savers and high interest current accounts. About £1600 in a S&S ISA at a reasonably high risk level. Mortgage approx £218k with a crazy London property value of around £400k.

I thought I was doing quite well till I read others' positions!

I'm basically stabbing around in the dark trying to meet all these goals and determining how much cash to put towards each. What I'm doing at the moment is a best guess but in trying to do better.

When I retire I'll probably look to move away from London which will also release some funds from the flat, assuming the north/south divide still exists - although I'm planning on having the mortgage paid off well before then.

chucknorris

adonis10 wrote: »

Having read a couple of interesting threads this morning ('over 50's how did you accumulate wealth' and 'a couple of questions for those retired') it made me want to get opinions of people in a similar situation to myself. Obviously, we face different financial challenges (worse pensions, less chance of profiting so much from property, automation killing jobs and industries etc.) and so I am keen to understand what people in their 30's* are planning on doing to secure their financial future.


Personally, I feel that I am well behind what I need to secure a relatively comfortable future, especially given the uncertainty around the state pension which will most likely not exist in 30 years time. Many older people seem to have multiple pensions to call upon but how is this possible? Is it tax efficient? Where is the best place to start?


My circumstances:
- Salary is a modest 32k. OH's salary circa 35k.
- Good workplace pension (e'er contributes 16%, I contribute 13%), OH's is a teacher's pension so I think she is sorted!
- Relatively low mortgage (144k on a 350k property, which is joint with partner) @2.14% fixed until July 2021.
- Circa 60k in cash and investments. Relative to my income, I think my cash position is ok (but who knows what will happen work wise so I want to keep this and add to it as much as possible) so I need to think about investment growth now and potentially a private pension, however I do think that this is 2nd choice to maximising S&S ISA contributions.
- Future inheritance will be circa 300-400k based on what is known now, however this could change dramatically with future unknowns (potential care costs etc.) so I am not factoring this into my plans.


Really keen to hear the thoughts/plans of others.


*this thread is not discriminating against those outside of their 30's but I've tried to target those in a similar boat to me as naturally one's plans will usually be different depending on which decade of life they are in.

Has your partner looked at buying additional pension in the TPS, it is exceptional value. I have bought the max allowed in the pre 2015 scheme, and when I join the newer scheme in 2020 I will start to buy more again.