Getting FIREd up 😀

South_coast

LOL, "Cheese or service station" on this week's New Vista Friday fun quiz 🤣 I only got 5/10, but top marks for originality!

greent

That's a fun quiz - I found it on fb00k at Xmas (so not hugely original by NV!) 

South_coast

Aaahh, I should have known!

kaycastle

Ooh that's great work on the pension growth!! How did you decide which plan/fund to change to? Is it the first time you've assessed for yourself and changed?

LadyWithAPlan

South_coast said:

I am far too excited about the imminent departure of Santander from my life 🤣!

I now have just three accounts with balances:
1) Current account (switching by the end of the month)
2) Edge saver (interest due 21/02, following which I will empty it)
3) Savings (currently holding the cash set aside for the LISA on 06/04, with anything else in the account to go to Chip on the same day)

I am so looking forward to ditching their dreadful app, removed overdraft and everything else that has annoyed me about them over the last couple of years. This feels like a new beginning 🤣🤣🤣

South_coast said:

I am now the proud owner of a Monzo account 👍!

(They offered me a £2k overdraft, I already like them more than Santander 🤣)

Woohoo! The new world beckons...

South_coast

kaycastle said:

Ooh that's great work on the pension growth!! How did you decide which plan/fund to change to? Is it the first time you've assessed for yourself and changed?

Good question! When I got the paperwork through for my first ever pension, back in *cough* 2006, I sat and earnestly read through the chunky book listing all the funds and selected for it to go 5% into the North American fund, 5% European, 5% Pacific Basin and 85% into the default fund*. This was me thinking I was going out on a limb a bit! When I joined my second scheme many years later, I just left it all in the default fund. I was in the second job for far fewer years, but was earning a lot more and paid a lot more in (my contributions were matched up to 7.5%), so these two are similar values (£30k/£34k) and they plod along fairly solidly in an upwards direction. I'd also opened a private pension (can't recall why, or what it was invested in!) and was putting about £50/month into that. 

When I started the third job, they only made the bare minimum contributions (3% them, 5% me), so it was never going to be huge sums of money. There were only 3 choices of funds "Cautious" / "Balanced" / "Adventurous", so I stuck it all in Adventurous and transferred in the private pension (about £4k, I think) to give it a kick-start. That one's now £14.7k. 

With the current job, there were I think 9 funds to choose from, so from memory I just went for the one with the least bonds in it (I have a bit of a beef with bonds at the moment, as I bought some of an inflation-linked UK gilt fund in my S&S ISA a few years ago, thinking it would just maintain its value and give a bit of stability, and it has performed dreadfully, currently £178 down on an £1102 investment. I don't want to sell while it's in the red, so have just been buying more of the main fund so it becomes an ever-shrinking percentage of the total invested - currently 6%). 

So nothing enormously technical, but it seems to be going OK! Currently sitting at £85k in pensions, which I'm perfectly happy with, as theoretically I want to be favouring S&S anyway, as it's accessible whenever I want it and the withdrawals aren't subject to income tax. I also have the LISA, which, if I recall correctly, will have about £90k in it when I can access at 60, so pensions aren't really the main thing for me. 


* Have just checked the names of the funds, and somewhere along the line it has morphed into 14%/6%/5%/75% 🤷‍♀️ No idea when that happened, and I can't recall doing it, but seeing as North America has been doing rather well, I guess it's no bad thing!

South_coast

While we're in the subject of pensions etc, I can see a scenario in the next few years where I'm exceeding my ISA allowance (nice problem to have, I know 🙄). Now I know that the effect of exceeding the PSA is to have my tax code changed, it doesn't particularly appeal to just take the hit on the tax, as the actual effect of it is to reduce my income (I think I naively thought they'd just send me a bill), but what are the other options for stashing cash tax-free? All I can come up with at the moment are either more into pensions, or start buying premium bonds, neither of which are grabbing me 🤔

QueenJess

South_coast said:

While we're in the subject of pensions etc, I can see a scenario in the next few years where I'm exceeding my ISA allowance (nice problem to have, I know 🙄).

This is odd phrasing. You mean you have more than £20k to put in an ISA?  You realise any interest earned in an ISA is already tax free and doesn’t count towards the PSA?

South_coast

Yes, 100%. But I could find myself in a position where I'm able to save more than £20k per year and need to decide where to put the remainder. It's not a 25/26 problem (credit cards), nor a 26/27 problem (will likely withdraw to clear the car finance early), but could be an issue 27/28 onwards....

South_coast

P.S. So to clarify, for 24/25 I have maxed out the ISA allowance (moved a lot of money around at the start of the tax year to get the benefit of it being in an ISA), and have cash put away outside of this, so that's where I've been caught by the PSA