When does a help to buy isa become not worthwhile?

thatguyoverthere

I've never owned a property before and am looking towards changing that at some point in the next year or two.

Assuming by the time I take the plunge I have enough money to be able to afford a place outright (nothing special, low 100k range; I have a pretty good job and my pension fund lets me take out a large lump sum for house buying)... would a help to buy isa still be worth it?

Playing with mortgage calculators and putting in low sums, like 12k for 10 years at 5%, I get repayments at the end of everything at 15k.

On the surface this isn't worth it unless I have the max amount of free money from the help to buy isa, at which point the extra 3k matches the 3k of payments.

However, things are not so simple. There is also matters of inflation to consider and that this money could be in the bank gaining me money over those 10 years.

I wonder, has anyone ever done the sums of point at which a help to buy mortgage no longer becomes worthwhile?

Or more generally....how much money owed in the long term would defeat having 2k in hand now?

Thrugelmir

thatguyoverthere wrote: »

my pension fund lets me take out a large lump sum for house buying

Why would you wish to tap into your pension fund now.

thatguyoverthere

Thrugelmir wrote: »

Why would you wish to tap into your pension fund now.

I don't rate my odds of living to retirement so its rather useless to me.
Owning a flat however will save me huge amounts of money in rent.

ValiantSon

thatguyoverthere wrote: »

I don't rate my odds of living to retirement so its rather useless to me.
Owning a flat however will save me huge amounts of money in rent.

Obviously we don't know if you are living with a health condition that potentially lessens your life expectancy, but what you are proposing is a huge gamble. What happens if you do live to retirement?

thatguyoverthere

ValiantSon wrote: »

Obviously we don't know if you are living with a health condition that potentially lessens your life expectancy, but what you are proposing is a huge gamble. What happens if you do live to retirement?

Then I'm a few hundred a year worse off for the few years past 73 (or whatever high number retirement is by then) that I live. Its dwarved by the amount I'd save by not having to pay rent for several decades.

Having a happier and more stable life in my younger years will be a critical factor in ensuring I reach this age.

bob_a_builder

When you live in the the south east ! - given the 250K limit

ValiantSon

thatguyoverthere wrote: »

Then I'm a few hundred a year worse off for the few years past 73 (or whatever high number retirement is by then) that I live. Its dwarved by the amount I'd save by not having to pay rent for several decades.

Having a happier and more stable life in my younger years will be a critical factor in ensuring I reach this age.

How have you calculated the net loss from retirement income? I'm not convinced by your figures.

Trying to second guess changes to NPA is not a good idea. Work on what you know now and plan your finances accordingly.

ashe

I think you need to speak to a financial advisor as what you are proposing probably sounds super in your head but is fairly barmy unless you have a terminal illness.

thatguyoverthere

I think you need to speak to a financial advisor as what you are proposing probably sounds super in your head but is fairly barmy unless you have a terminal illness.

So... help to buy isa isn't worth it at all if I get to the stage where I could afford a place with savings?

ValiantSon wrote: »

How have you calculated the net loss from retirement income? I'm not convinced by your figures.

Trying to second guess changes to NPA is not a good idea. Work on what you know now and plan your finances accordingly.

I asked the pension fund department at my company and they did the calculation for me.

Anyway.

This is all besides the point.

ValiantSon

It isn't beside the point at all. We are trying to help you, but that does mean that we might suggest that your plan is a big risk. If you don't want to hear that then fine, go right ahead.

thatguyoverthere

ValiantSon wrote: »

It isn't beside the point at all. We are trying to help you, but that does mean that we might suggest that your plan is a big risk. If you don't want to hear that then fine, go right ahead.

It's not the question that I have however.

What's the problem with taking 20,000 out of a pension built up over a few years?
I've hopefully still got plenty of years of working life where I'll be forced to pay into pension schemes. And the odds about life expectancy and ever creeping up retirement dates just don't make it seem worth my while to plan for the days where I'm half dead.