Finance Review

Cotta

Albermarle wrote: »

As big as possible of course !

Obviously with a salary of £31K and kids on the way , probably will be a struggle to add more than you do already . In this case my original question has some importance .

I will need to call the pension administrator as I have never really paid much attention to this. What type of questions should I be asking?

xylophone

Do you really want to be a landlord?

Do you really want to pay the extra SDLT on the purchase of a second property?

Why not just sell and buy a suitable family home?

If you want to keep the ISA, there are better rates available.

https://www.thisismoney.co.uk/money/article-1583859/Best-savings-rates-General-savings-Internet-branch.html

Cotta

xylophone wrote: »

Do you really want to be a landlord? It was supposed to be a nestegg for the future.

Do you really want to pay the extra SDLT on the purchase of a second property? No, my wife is also selling her house and she won't have another house. How will this work on SDLT?

Why not just sell and buy a suitable family home? It's a possibility.

If you want to keep the ISA, there are better rates available. Saga at 1.35% looks the best for easy access with no penalties?

https://www.thisismoney.co.uk/money/article-1583859/Best-savings-rates-General-savings-Internet-branch.html

Answers in bold.

Albermarle

I will need to call the pension administrator as I have never really paid much attention to this. What type of questions should I be asking?

Normally within a pension there is a choice of funds to invest your money . Depending on the provider and the type , the choice could be from just one fund, a handful of funds , a few hundred or a few thousand ..
For most pensions if you do not choose a fund ( and about 95% do not ) the money goes into a default fund .
The very basics of funds is that the higher the equity ( shares) % the more the risk/volatility but the higher the potential growth in the long term .
So in very simple terms the younger you are the higher % equity ( 80%+ ) funds are better but this should be reduced as you get nearer retirement .
The default fund will be middle of the road and may in fact automatically reduce the equity % as one gets older.
You should be able to get online access to have a look where your money is invested and what alternatives there might be .

xylophone

https://www.blakemorgan.co.uk/sdlt-case-notes/

Alexland

Cotta wrote: »

No, my wife is also selling her house and she won't have another house. How will this work on SDLT?

Even if she only buys the new property in her name (and can raise a big enough mortgage from her income) the fact she is married and you will also still own a property will be a problem.

https://www.zoopla.co.uk/discover/buying/q-a-new-3-stamp-duty-surcharges/

"What if I am married and one of us owns a property?
The strategy of having one person (the one without an existing property) buy the new home does not work if you are married or in a civil partnership. This is because the rules will treat you as if you were joint buyers anyway, even if you're not."

Alex

Cotta

Albermarle wrote: »

Normally within a pension there is a choice of funds to invest your money . Depending on the provider and the type , the choice could be from just one fund, a handful of funds , a few hundred or a few thousand ..
For most pensions if you do not choose a fund ( and about 95% do not ) the money goes into a default fund .
The very basics of funds is that the higher the equity ( shares) % the more the risk/volatility but the higher the potential growth in the long term .
So in very simple terms the younger you are the higher % equity ( 80%+ ) funds are better but this should be reduced as you get nearer retirement .
The default fund will be middle of the road and may in fact automatically reduce the equity % as one gets older.
You should be able to get online access to have a look where your money is invested and what alternatives there might be .

Looking at the platform online it indicates it's a "growth fund".

DairyQueen

Married couples are only permitted to claim Principal Private Residence Relief for CGT purposes on one property and they must elect which property within two years of marriage. To my cost I have only just discovered this.

It doesn't matter in whose name each property is owned. In our case, we own two properties... each owned individually. Both are primary residences as Mr DQ spends weekdays in the property he owns (work reasons) whilst I am based permanently at the other property.

We now wish to sell both and buy one property. We had considered renting the property I own but the CGT issue is sufficient to deter us.

The ideal is to sell at least one property before you marry in order to avoid the CGT trap. I discovered this rather late in the day.

AnotherJoe

"Supposed to be a nest egg"

OK let's see the calculation.
The rent income
The tax on the rent
Expenses
Additional SDLT on the new residence
Extra interest on the new mortgage (due to having a worse LTV)

Cotta

Albermarle wrote: »

Normally within a pension there is a choice of funds to invest your money . Depending on the provider and the type , the choice could be from just one fund, a handful of funds , a few hundred or a few thousand ..
For most pensions if you do not choose a fund ( and about 95% do not ) the money goes into a default fund .
The very basics of funds is that the higher the equity ( shares) % the more the risk/volatility but the higher the potential growth in the long term .
So in very simple terms the younger you are the higher % equity ( 80%+ ) funds are better but this should be reduced as you get nearer retirement .
The default fund will be middle of the road and may in fact automatically reduce the equity % as one gets older.
You should be able to get online access to have a look where your money is invested and what alternatives there might be .

Just got off the phone to my administrator, my pension pot is called a growth fund and below is how it is invested:

AVC + Pre97 SCC + Core ER Contributions + Transfer in contributions + ER Matching Contributions + EE Saver Contributions