Help please on savings and investments

NStephanie83

Hello Forum members,

Need some advice and guidance on what and how we should be doing to make sure our money is working for us.

We have been lurking on this forum for a while and seen a lot of helpful replies to questions from other people and gained a lot of knowledge about personal finance and smart tips. We have realized that we were most financially illiterate but we don't want to be at same position in 6 months from now.

Please excuse us if something we ask is not relevant to this forum rules.

Household
We are a family of 4.
Husband and wife - 35 year old
2 daughters - 2 year old and 1 month old
Wife has never been employed
Husband in full-time employment
Elder daughter hasnt been to nursery as mother is stay-at-home taking care.
Own house bought on mortgage

Income
- Husband salary: 50,000 per year

Pension
- Husband workplace pension current value: 6500
- Annually, husband will sacrifice 3000 (before tax)
- Husband qualifying years for state pension: 7
- Wife has no pension account.

Childcare voucher
- Annually, husband sacrifice 1500 (before tax)
- Already 1500 in balance

Annual Expenses (19390 as below)
- Mortgage: 7000
- Tourism + Social Events: 3400
- Grocery: 2400
- Shopping: 1500
- Husband commute to work by public transport (driving license but no car): 1200
- Council Tax: 1250
- Gas + Electricity + Water: 900
- Eating Out: 600
- TV + Broadband + Line Rental: 400
- Taxi: 300
- TV license: 150
- Building + Content Insurance: 120
- Husband Mobile (unlimited minutes, unlimited texts, 4GB data): 110
- Wife Mobile: 60

We have around 14,500 annually to pay for:
- House Maintainence
- Dentist
- Kid's education
- Savings
- Investment
- Charity Donations
- Emergency Fund
- Others?

Bank Account
- All money is in a single bank account paying 0.25% interest
- No credit cards

Where do you think we need to focus in terms of:
- Cutting expenses
- Savings, Investments
- ISAs
- Bank accounts, credit card
- Wife's pension
- Others?

PeacefulWaters

£2,880 a year in to a stakeholder pension for wifey will turn into £3,600 with tax relief and open up opportunities nearer retirement age.

xylophone

Your wife is 35 but has never worked?

You have checked her NI record?
https://www.gov.uk/check-state-pension

She is in receipt of Child Benefit?

Had you considered a joint Santander 123 current account on which you would have your cash back DDs and which pays interest at 1.5% on up to £20,000?

https://www.santander.co.uk/uk/current-accounts/123-current-account?cid=ppc-123currentaccounts-google-dr-search-currentaccounts-Apr17&gclid=EAIaIQobChMIsdeFsKDx2QIVQY0bCh2NPQelEAAYASAAEgLGjfD_BwE&gclsrc=aw.ds

Had you looked at other interest paying current accounts?

https://www.moneysavingexpert.com/banking/compare-best-bank-accounts

NStephanie83

Thanks for all the responses and questions.

Your wife is 35 but has never worked?

Unfortunately true. Checked the statement already thanks to MSE website.

She is in receipt of Child Benefit?

No because husband income is 50,000 - maybe missing out on something here.

Had you considered a joint Santander 123 current account

It comes with £60 fee and we didn't think our cashback will be enough to cover it.

Had you looked at other interest paying current accounts?

Husband filling online application for TSB classic plus account that gives £10 monthly cashback and pay interest.

£2,880 a year in to a stakeholder pension for wifey will turn into £3,600 with tax relief

We didn't know this. Is there a link to MSE page or otherwise where we can read or learn more on how to set this up.

PeacefulWaters

No because husband income is 50,000

It's £47,000 after pension contributions.

MallyGirl

NStephanie83 wrote: »

Thanks for all the responses and questions.

No because husband income is 50,000 - maybe missing out on something here.

Can you salary sacrifice To get below £50k?

NStephanie83

It's £47,000 after pension contributions.

YES - you are an absolute genius. Thanks a ton.
Salary is even lower once childcare vouchers are deducted.

MSE TEAM - We just made 32 per week thanks to helpful members on this forum. We have planned rest of March as Money Makeover March and will try to post overall savings (if we could calculate).

Will appreciate any further help, tips and guidance on savings / investment / planning / anything else...

Thanks

NStephanie83

Got accepted for TSB Classic Plus - so that's some regular interest and cashback.

£2,880 a year in to a stakeholder pension for wifey will turn into £3,600 with tax relief

Will appreciate some guidance on this topic.

MallyGirl

Basically anyone can get tax relief on pension contributions up to total limit of £3600. Even if they don!!!8217;t pay any tax. So pay in £2880 in and HMRC makes it up to £3600. A gift of £720. Free money

MallyGirl

Take a read of this thread:

https://forums.moneysavingexpert.com/discussion/5580163

NStephanie83

Basically anyone can get tax relief on pension contributions up to total limit of £3600.

Thanks! Slightly more clear now.

So we open an account in wife's name with some private pension provider. Husband pays money into this and then at end of year we contact HMRC to give us 720? That sounds good.

I believe this money will be invested so can go both up and down. Or is this safe saving account.

How can I find trusted and FCA regulated private pension provider where I can get good returns at low fee? And can pension provider deal with HMRC in background?

Thanks.