Embarrassed 40 year old - no pension.

sho_me_da_money

PENSION
When jacking up my contributions, I moved the slider to the age of 58 (opposed to 55), which is the new early retirement age coming into effect in a few years as per a previous comment on this thread. This is the breakdown it gave me:

Contributions	Value	% of Salary
My Contribution (via Salary Sacrifice)	£1,030.00	20.00%
Company Contribution	£257.50	5.00%
Total Contribution	£1,287.50	25.00%
Total Cost To Net Pay	£612.15

Projected Company Pension Income

	From Your Company	From Your Existing Pension
Fund Value at Retirement	£512,793.69	£0.00 (from your other pensions)
Tax Free Cash	£128,198.42	£0.00 (from your other pensions)
Projected Annual Income (in today's terms net)	£12,195.52	£0.00 (in today's terms net from your existing pensions)
Your Current Salary	£61,800.00

MORTGAGE DETAILS
I am seriously considering selling £8200.00 worth of my stock and overpay my mortgage next month (first anniversary). You guys think this is a good idea?

BALANCE - £82,598.87

• Monthly payment

£348.47Current interest rate1.69%Follow on rate 3.59%Initial term 25 yearsOutstanding remaining term 24 years 1 monthMortgage type ResidentialRepayment type Repayment

Sea_Shell

How are your stocks performing?

Better than 1.69%?

sho_me_da_money

Just another comment to my last post.
My mortgage product term is 5 years fixed. I believe I can overpay 10% on each anniversary OR pay an unlimited amount after the 5 year term is over. I am in two minds of either paying 10% on each anniversary versus leaving my shares intact and drawing them all in 5 years and pay off a heavy sum.

There are several reputable analysts suggesting the stock price of the company will double in the next 5 years. FYI this is one of the biggest companies in the world.

sho_me_da_money

Sea_Shell said:

How are your stocks performing?

Better than 1.69%?

What a beauty of a comment. Yes they are doing better than 1.69%. Heck they are up over 1.5% today. I guess this means i should hold onto them for the next 5 years and reassess.

Anonymous101

Personally I don't consider overpaying a 1.69% debt to be the best choice.
There's lots of other investment options available which historically have done better than 1.69%... putting more into the pension for starters.

sho_me_da_money

Slightly off topic and focussed on the mortgage. If you had the money to pay off the entire mortgage - would you? Im curious more than anything to know how your strong financial minds work. Is it better to pay off or better to continue and invest the money elsewhere. Just a curious question.

Robin9

sho_me_da_money said:

Current Outgoings

• I have a 0% credit card on which I owe £12,000 and currently pay off £500 per month.
• Mortgage payment is £350 per month.
• My bills (inc. council tax) are around £500 per month
• My food costs are around £300 per month

Nothing on holidays, transport (season ticket, car), clothing.
Look very hard at your expenditure - you are frittering over £1500 a month.

Saving for the future is good but you need some fun today.

Sea_Shell

sho_me_da_money said:

Slightly off topic and focussed on the mortgage. If you had the money to pay off the entire mortgage - would you? Im curious more than anything to know how your strong financial minds work. Is it better to pay off or better to continue and invest the money elsewhere. Just a curious question.

Now, knowing what we know, increased ISA limits, ease of investments and the pension freedoms in place.  No we wouldn't.

But we did, 15 years ago.   Peace of mind can be worth £X.   Bird in the hand and all that.

In hindsight (a glorious thing!) if we'd have invested all that money instead, we would have ended up better off.

Albermarle

sho_me_da_money said:

Slightly off topic and focussed on the mortgage. If you had the money to pay off the entire mortgage - would you? Im curious more than anything to know how your strong financial minds work. Is it better to pay off or better to continue and invest the money elsewhere. Just a curious question.

Probably one of the most discussed topics on the forum , with similar types of questions asked several times a week .
So suggest you do some scrolling through the forum ,
Here is a starter for 10
https://forums.moneysavingexpert.com/discussion/6274015/inheritance-pay-mortgage-or-invest-first-world-problem-sorry#latest

hugheskevi

sho_me_da_money said:

PENSION
When jacking up my contributions, I moved the slider to the age of 58 (opposed to 55), which is the new early retirement age coming into effect in a few years as per a previous comment on this thread. 

To note that it is 57, and is subject to legislation.

However, the government’s position remains that it is, in principle, appropriate for the minimum pension age to remain around 10 years under state pension age, although does not intend to link minimum pension age rises automatically to state pension age increases at this time.