New user - help with financial health

harshitguptaiitr

I notice you are concerned and actively planning for situation if the single source of your income i.e. your job goes away. However in addition to what other people have mentioned, you should also plan for following situations:

- What happens to the finances if due to illness, permanent disability, accident, death - you are not able to bring income to the household? Ans:
1. Get a Life Insurance + Critical Illness Cover and maybe an Income Protection Cover (which is different from Redundancy Protection)
2. Write a will so that what happens to the finances and welfare of your family is done per your wishes and not by default rules.

- Your partner is not earning at the moment but is hopefully contributing in saving money in the form of childcare costs. What will happen financially if due to illness, permanent disability, accident, death she (excuse using gender pronoun) is unable to save that money and you have to spend more on childcare?
Ans: Get a Life Insurance + Critical Illness Cover

Thanks for the helpful information. I will look at:
> higher interest paying bank accounts
> increase contribution in my pension account.
> LISA for partner

Excellent plan, plus read other comments in detail - there could be lots of wisdom when read between the lines.

Can someone please help what my strategy should b if I want to move to a bigger house in 2-2.5 years from now?

I am sure someone more experienced and knowledgable will be able to advise you on that.

bostonerimus

Your finances are quite healthy and you are doing some good things with savings and the pension.

I would look into life insurance so that if you die your family gets a nice big lump sum to provide income.

I would do a budget so you can see where to save money. I bet you can find lots of savings that can then be ploughing back into the pension and an ISA.

I would obviously pay off all high interest debt.

If your spouse can find a job that would be a big step up, but only if child care expenses and tax don’t take too much of the extra income. It might be more practical to wait until the kids start school.

bostonerimus

Why do you want to move to a bigger house. Is it a need or a want?

MaxiRobriguez

OP is doing OK. Even £25k in pension which he thinks is low and others have said is bad isn't *that* bad. It takes longer for the younger generations to get on housing ladder and build up pension because the reality is house prices to wages are harsher than they ever have been and pension provision is less generous too.

OP is in a better financial position than most his age. If partner can find a job without incurring costs of childcare that would wipe out any wages that'd be the best thing. OP is fine, can (and sounds like will) be able to do more and provide for himself for rest of life, but question marks over ability to stretch finances for the entire family. Partner needs to earn, or needs and wants need to reduce.

hellojohn8doe7

I would look into life insurance so that if you die your family gets a nice big lump sum to provide income.

True. I am looking into good value for money options.

I would do a budget so you can see where to save money.

Good point. I have already done Gas + Electricity and cheapest option (on MSE cheap energy club) saves me £24/year. I didn't knew until 2 days ago that such a thing exists. I will do on other spends as well.

I would obviously pay off all high interest debt.

My only debt is my mortgage and day to day credit card spending. I pay all my credit card on the day the statement is issued. I have already paid off my car loan. My worry is what will happen to mortgage if my income goes away.

If your spouse can find a job that would be a big step up.

Current part time job offers she is getting is paying £10/month less than what we will end up paying in extra childcare costs. So she is looking for job options which will at minimum match the extra childcare costs. However while at home, she is working hard to enhance her skills to make her employable in the future.

Why do you want to move to a bigger house. Is it a need or a want?

Our current house-size will be classified as "living within means" for 2 adults and 1 child. Even with 2 children at their current age - we are still Ok. However 2-2.5 years fro now, I can foresee the house will be smaller for our family size. That is why would want to know what strategy should be in place to make it happen.

hellojohn8doe7

Why do you want to move to a bigger house. Is it a need or a want?

Plus we would like to move to a richer neighbourhood, if possible.

Per English indices of deprivation 2015 data, we are living in post code which is 20% most deprived neighbourhoods.

Albermarle

Plus we would like to move to a richer neighbourhood, if possible

You will most likely have a choice to make at some point :
Either stay in current neighbourhood and buy a bigger house :
Or move to nicer area and have a house size similar to now .

I read some research somewhere that given this choice most people will move to the nicer area and then complain about the house prices and the extra cost of commuting