Savings v Mortgage conundrum

atush

Your number (ie look up the Number thread) is the amount, in todays money, you want/need at retirement

Running_on_empty_2

Aha - well, that will depend how much we have available when we do retire! We will be living within our means once we get to that point, some I'm afraid my (frustrating for you) response is that we will only be able to plan for that once we are there. So we do not have a 'number' in that sense! [Hears readers face-palm]

AndyT678

Running_on_empty wrote: »

I'm afraid my ... response is that we will only be able to plan for that once we are there.

You can & should try to plan it now.

You can start with your current outgoings, that should be easy enough.

Then subtract all the things that won't be relevant when you're 60 and retired. Mortgage payments will be gone around then, commuting cost is gone, maybe you can get rid of a car etc...

Then add all the extra things that you might need / want. More heating during the day, maybe you want to go out to lunch twice per week or take a couple of extra holidays etc...

That should give you an idea of the scale of income you need to have the lifestyle you want in retirement.

Now compare that to your pension forecast.

If the pension is lower then you need to save more now or reduce your expectations for the future. Then you start looking at how big is the gap and what level of saving contribution & growth rates will close it.
If the pension is higher then you're set and you can choose to spend more now or continue to accumulate money for more / better lunches and holidays or earlier retirement or to pass on to beneficiaries.

justme111

Running_on_empty wrote: »

Aha - well, that will depend how much we have available when we do retire! We will be living within our means once we get to that point, some I'm afraid my (frustrating for you) response is that we will only be able to plan for that once we are there. So we do not have a 'number' in that sense! [Hears readers face-palm]

fair enough. as you would have about 40 k for 2 of you then you would be living within those 40 k (which is a very reasonable amount ) and you do not need any savings or investing etc. so what you do with money now is pretry much what you feel comfortable with doing as you do not have a particular purpose for it other than "rainy day" and " just in case".
you really appear to be soŕted for later on in life so you likely will look at how you can stop "running on empty" sooner - drop hours , invest in pension until your pot allowing for growth is enough to live on for a couple of years from the earliest when you can access your private pensiin till 60 ( keeping an eye on LTA and hoping tge government will not increase that age). That's what I would have done anyway.
Not having the Number has a danger that you would spend working unnecessarily big part of your time which is a most prescious asset you have ..

Running_on_empty_2

Thanks justme111 - like most things, it's all a little unknown until you get there, but will certainly keep saving and will look at overpaying into our pensions too..........or finding another one to look at. ;-)

atush

Read the number thread.

As a start, if you know your annual expenditure now- remove and mtg and pension payments.