Advice at 30

Sea_Shell

I agree, to a point. Horses for courses.

We surely all aim to be masters of our own destiny.

However, think of it this way, will your future 65+ year old self thank you for the decisions you made "back in the day"

Spreadsheetman

30andcounting wrote: »

I guess all the above is about opinions, what if you like your job? You could retire at 50 and miss the buzz of working? I've always been driven and enjoy working, the original point of this thread was to make sure I have enough money to retire when I want to, not necessarily being tight for the next 30 years, then sit in the sun all wrinkly with a pina colada because I can finally afford it. I just don't see that as quality of life.

That is all opinions of course. I agrees having a daily costa is excessive, but buying your lunch once or twice a week isn't, if it means spending a bit of extra precious time with your baby at the end of a working day (for example) It's about balance, not fannying around making sandwiches, I think there are some extreme views here.

It must be quite stressful counting every penny, then you could drop dead at 54 a year before you access the massive pension? You get my drift

Quite a few people here have been driven workers in the past (I include myself in that - I bailed on an engineering career to start my own business aged 40), but the stress starts getting to them in their 50s - it certainly did to me. Having the option to downshift or stop completely is a very valuable thing, certainly worth a bit of budget tightness in earlier years. Not tight to the extent of not having a life, but being sensible with spending and having an eye to the future.

[Deleted User]

30andcounting wrote: »

I do have spare cash but like to pay a bit off my mortgage, have some money aside incase we need something. I fear if I put more into my pension its tied up until 55 at least. I also try to balance by enjoying life rather than wondering whether I should have a small luxury now and again or not. You could get run over by a bus tomorrow as they say, so not putting all my eggs in one basket, but trying to do enough

Seems reasonable.

crv1963

30andcounting wrote: »

I guess all the above is about opinions, what if you like your job? You could retire at 50 and miss the buzz of working? I've always been driven and enjoy working, the original point of this thread was to make sure I have enough money to retire when I want to, not necessarily being tight for the next 30 years, then sit in the sun all wrinkly with a pina colada because I can finally afford it. I just don't see that as quality of life.

That is all opinions of course. I agrees having a daily costa is excessive, but buying your lunch once or twice a week isn't, if it means spending a bit of extra precious time with your baby at the end of a working day (for example) It's about balance, not fannying around making sandwiches, I think there are some extreme views here.

It must be quite stressful counting every penny, then you could drop dead at 54 a year before you access the massive pension? You get my drift

I agree it is all about balancing what is right for you. I think the point people are making is know roughly where money goes and then choices about the spending of it.

Minor changes can make a big difference, for instance I have a long commute and stay over near my workplace 2-4 days per week. I could stay in a B&B at £30pn or £240-£360 pm, but I rent a room from a colleague in another team at £20pn so save around £160 pm. Helps me, helps my colleague.

I had a heart attack 2 years ago at 53- no warning signs, no other issues, made me realise it really is time versus money.

Cut back what you can, without compromising lifestyle, I like nice clothes but do I need that designer coat? No it's a want and can go on my Christmas list etc. I like single malt, do I need to pay £40 a bottle- no I'll buy a bottle every now and then when it's on offer at £26 a bottle- so we don't change lifestyle drastically but do change spending, so freeing money up for saving. There's more than one way to skin a cat.

By pouring what you can into savings now you'll reap the reward later- I put £50 pm into Equitable Life AVC for 2 years, some 21 years ago, so £1200, I've never touched it or changed it. It is now worth £6400 and due to the way they are winding up the company it will be uplifted in the next year or so before being transferred to another provider. That's a real life example of compounding at work.

You have greater choices- ISA, LISA SIPP, workplace pension etc, choose your vehicle carefully, reduce your tax bill get the child benefit, cut a few lunches out and spend it elsewhere that is the general idea.

worried_jim

Owen1991 wrote: »

I'm 28 and earn £22k (take home £1450ish). I am not a homeowner, but have £19k in a LISA to go towards a house when needed (contribute £4k a year). I have a longterm girlfriend who is a homeowner, but doesn't want me to help out until we move and buy together as I'm away at work during the week.

I contributing £200 a month to my SIPP (currently at £7k) and later this year I'm getting a £300 a month pay rise and plan to up my contributions to £400.

I'm in the military so should have a half decent DB pension but I don't want to rely on that, especially if I leave service earlier than I expect.

My circumstances are very different to yours, but that's where I'm at.

Looks good! I started in 1991 on £8.5k per year. I'm 45 now and save 18% per month and I am quite satisfied with where I am at. I think you are well set for your future.

Anonymous101

30andcounting wrote: »

I guess all the above is about opinions, what if you like your job? You could retire at 50 and miss the buzz of working? I've always been driven and enjoy working, the original point of this thread was to make sure I have enough money to retire when I want to, not necessarily being tight for the next 30 years, then sit in the sun all wrinkly with a pina colada because I can finally afford it. I just don't see that as quality of life.

That is all opinions of course. I agrees having a daily costa is excessive, but buying your lunch once or twice a week isn't, if it means spending a bit of extra precious time with your baby at the end of a working day (for example) It's about balance, not fannying around making sandwiches, I think there are some extreme views here.

It must be quite stressful counting every penny, then you could drop dead at 54 a year before you access the massive pension? You get my drift

You seem to have a good grip on your spending already. I'm sure you'll find the right balance for you.

If you continue to save and enable you to become F.I. before your peers then thats awesome. Having put the hard work in to your savings won't lead to compulsory retirement so if you continue to enjoy work then keep working. Just read the Early Retirement Wannabe thread. (perhaps not all of it!)
However being F.I. would be a huge safety net should you ever find work isn't always as it is now or even that the company you work for unexpectedly gets into trouble.

Have you ever heard of Zero based budgeting? That's what I do. It works for me and being an accountant it could work for you. I find its useful. My other half doesn't think in the same way and it doesn't work for her so she uses a different method. Its just about finding what works for you. :cool:

snowqueen555

30andcounting wrote: »

I guess all the above is about opinions, what if you like your job? You could retire at 50 and miss the buzz of working? I've always been driven and enjoy working, the original point of this thread was to make sure I have enough money to retire when I want to, not necessarily being tight for the next 30 years, then sit in the sun all wrinkly with a pina colada because I can finally afford it. I just don't see that as quality of life.

That is all opinions of course. I agrees having a daily costa is excessive, but buying your lunch once or twice a week isn't, if it means spending a bit of extra precious time with your baby at the end of a working day (for example) It's about balance, not fannying around making sandwiches, I think there are some extreme views here.

It must be quite stressful counting every penny, then you could drop dead at 54 a year before you access the massive pension? You get my drift

There is nothing wrong with treating yourself, and no-one is asking you to be a hermit and count the pennies. As it stands you are asking the forum whether you should increase your pensions contributions by 1%

Most advice would be a resounding yes, and probably more than that if you can afford it (which sounds like you could). Also remember that retirement savings does not necessarily have to be in a pension scheme.

Now in my mind, you should be able to overpay the mortgage, make savings, and increase your pension savings.

£475 a month is more than most people in their 30's because you earn quite a good wage.

You have to be realistic and realise 10% investment of your salary will not produce a pension value of 100% of your current salary, it is likely to produce somewhere in the region of 50% of your current salary if you invest for 30 years. Is that enough for you? It would be for me but maybe your standard of living is higher than mine.

Thrugelmir

30andcounting wrote: »

It's about balance, not fannying around making sandwiches, I think there are some extreme views here.

I spend less time making my sandwiches than my colleagues do queueing in the staff canteen. Instead I spend the extra time taking a walk at lunch times. From acorns grow oak trees.

Mr_EDATD

For me its a balance between enjoying life now and saving for the future. Keep track of what you spend, make sure the areas that some may consider extravagant are things that you a passionate about (for us it is holidays, cars and exercise) but don't just fritter money away on things that are not important to you. We could have a bigger / flasher house, travel first class, spend more on clothes, eat out more regularly, 5* hotels when we go on city breaks, etc. but those things wouldn't make us any happier so it would feel like a waste.

Understand what level of income will give YOU an enjoyable retirement and have a plan to get there. Don't worry what others do.

Saving for retirement doesn't all have to be in a pension, particularly if you might need some flexibility before 55. We do a mixture of pension contributions, S&S ISAs and mortgage overpayments. We have a fairly high income but live well within our means and now (at 38 & 40) put about 40% of funds towards achieving financial independance. A key for me was to get to a lifestyle we enjoy and then any pay rises from that point go into the FIRE plan.

ferox666

crv1963 wrote: »

I agree it is all about balancing what is right for you. I think the point people are making is know roughly where money goes and then choices about the spending of it.

Minor changes can make a big difference, for instance I have a long commute and stay over near my workplace 2-4 days per week. I could stay in a B&B at £30pn or £240-£360 pm, but I rent a room from a colleague in another team at £20pn so save around £160 pm. Helps me, helps my colleague.

I had a heart attack 2 years ago at 53- no warning signs, no other issues, made me realise it really is time versus money.

Cut back what you can, without compromising lifestyle, I like nice clothes but do I need that designer coat? No it's a want and can go on my Christmas list etc. I like single malt, do I need to pay £40 a bottle- no I'll buy a bottle every now and then when it's on offer at £26 a bottle- so we don't change lifestyle drastically but do change spending, so freeing money up for saving. There's more than one way to skin a cat.

By pouring what you can into savings now you'll reap the reward later- I put £50 pm into Equitable Life AVC for 2 years, some 21 years ago, so £1200, I've never touched it or changed it. It is now worth £6400 and due to the way they are winding up the company it will be uplifted in the next year or so before being transferred to another provider. That's a real life example of compounding at work.

You have greater choices- ISA, LISA SIPP, workplace pension etc, choose your vehicle carefully, reduce your tax bill get the child benefit, cut a few lunches out and spend it elsewhere that is the general idea.

£6400? Do you mean £64,000? If yes, good compounding!