dazed and confused

Saint_Hope

my rent is 420 month cant buy h a house that stopped in 2016 don't want to eat spam for the next 15 years so no mortgage what else can I do good people

bolwin1

What are you expecting people to suggest ? If you want to buy a house but don't want a mortgage & don't have the money, you're either going to have to take on a second job & work like mad to get some money behind you or get lucky & win the lottery. If there was a magic way of getting a hundred grand house without a mortgage or outright money in the bank everyone would be doing it.

bluenose1

You have enough for a deposit from your pension if you wanted and obviously the less you lend the lower the repayments. Suppose it depends how important it is to you to own a home. Plus when you retire if your income reduces would you get a rebate on the rent?
I was reading about some new mortgages for older borrowers, the longer the term the lower the repayments.
Might be worth reading the below link.
https://www.money.co.uk/mortgages/how-to-get-a-mortgage-if-you-are-an-older-borrower.htm

DairyQueen

Can I just confirm that the reason you are hoping to buy is to reduce expenses in retirement? When you say that your pension is 'no good' do you mean that it will be insufficient to cover rent or a mortgage without leaving you strapped?

If this is the case, could you let us know:
- Your 'number' (i.e. the amount of income you think you will need in retirement at today's prices).
- How much will you receive from your 'council' pension if you work another 10 years?
- Have you checked your state pension (SP)? Are you on course to receive the full amount?
- How much SP will your partner receive?
- Does your partner have any pensions/savings other than the SP?
- Do you have any other savings (other than the lump sum and pension mentioned in your opening post)?

With this kind of information the forum will be able to give you suggestions on how to optimise your retirement income. It could be that the requirement to pay rent in retirement may not be as problematic as you think.

Apodemus

And can you clarify your pension payments to the Council? You say “5k per year going in”, which would be £416 per month...which is about three times what the normal payment to a council pension scheme would be on a salary of £23k. So you are presumably paying something like £250-£300 per month in additional voluntary payments? This might be very sensible, but you have to weigh up the additional pension against using this for mortgage payments.

atush

What did you do with the 16K you took out of yoru pension?

Saint_Hope

£1400 per month
£600 per month
full amount
about half
not much
premium bonds £6700

Saint_Hope

bought a car didn't have one but needed it bought 5 k premium bonds

DairyQueen

Saint_Hope wrote: »

£1400 per month
£600 per month
full amount
about half
not much
premium bonds £6700

OK, just to clarify:
1) You will receive £600p.m. (£7200p.a.) from your council pension in 10 years time at age 66.
2) You will receive the full state pension at age 67 (currently £8540 pa.).
3) Your partner's SP looks low. How old is your partner? What is the value of their current SP entitlement? Can you provide the exact value they are projected to receive at state pension age if they continue to work until then?
4) What are your partner's pension arrangements with the current employer? Is this a public sector or private scheme? How much are their current contributions? How much does the employer contribute?

It's important that you know the exact values for your partner's pensions as working to maximise this looks like one of the key things that you can do to increase your retirement income. Have you checked your partner's state pension online?

You need £16800 p.a. income at today's prices (£1400p.m.). Your council pension (at today's prices, and assuming 3% inflation) is currently worth approx £5350. Add your state pension and you have £13890 of that £16800 requirement. You are therefore £2910pa. short of your number.

Even if your partner only qualified for 50% of the state pension this would cover the shortfall (50% of £8540 = £4270).

To summarise, between you, it looks like you will receive at least the following in guaranteed, index-linked income at today's prices:

Your council pension: £5350
Your SP: £8540
Your partner's SP: £4270
Total £18160

You will have your number covered but may have the capacity and time to increase the comfort level of that income. This especially applies to your partner. Their position is the weak link. Unless they are (or become) a legal spouse they may not qualify for any survivor pension if they outlive you. Your SP will die with you. This would leave them very vulnerable.

You have the £49k balance of your other pot (plus some savings) to make up the shortfall of your household income if you are the survivor.

The first step to take is to take a long, hard look at your partner's pension and seek to max this - beginning with their SP. Detailed suggestions can be made once the above info is available/confirmed.

Terron

Given that you have the £49k left in your pension and over 6k in premium bonds it would seem likely that you could put together a 25% deposit for a £100k house. That would bring the payments under £500 pm. There would be extra costs on top of that - insurance and maintenance. It looks doable, but difficult. Still given that you won't really benefit for 15 years it may well not be worth it.