10 years to clear £334K - our FIRE journey

CCW007

Thanks for the question, it has prompted me to log in and check if the LGA scheme pension details have updated for last financial year and they have so I now have up-to-date figures.  

The DB pension should be pretty healthy - currently stands at just over £5k; based on current salary my projections were that if I work to 57 and defer taking it to 67 I would get around £17k PA.  My very rough calculations based on new salary are that it should be around £20k PA.  So not far off my £24k target (which is based on nothing scientific at all, just finger in the air guesswork). I'm not convinced the SP will be around in its current form - worst case it may be means tested - so I don't want to rely on that. New salary means I am moving up to a new contribution band but it is such a good pension even with increased contributions, I realise how lucky I am.

SIPP and S&S ISA are mainly to fund gap between stopping work and drawing DB.  I like the SIPP because of tax relief but prefer the flexibility of the ISA in that I will be able to access when I want, not when the government decides I can!  However new role will take me into HRT band so the tax relief on the SIPP may make it even more appealing. 

OH's pensions are more of a concern; he only has DC and makes what feels like a hefty salary sacrifice contribution every month but we really need to do a proper review of that and see if we are doing enough or need to send more that way.  It's easy to just look at my situation but we really need to look at them both together.

edinburgher

That's grand, it wasn't entirely clear to me whether the DB was your preserved pension or your current pension.

Mrs E and I will likely be in a similar boat (using SIPPs and ISAs to bridge the gap between retiring and getting to SPA). I have two DB pensions (preserved one and current one) and these should be worth c. £22k PA by the time I hit 58. There is also a possibility that I could take the DB pensions at 58 (39% hit to their value, so £13,420). It all depends how our DC pensions do in the next 19 years and whether or not we can pay off the mortgage before then.

Mrs E has just gone up to a 20% personal contribution to her DC (also salary sacrifice). I'm dreading it to be honest, greatly prefer my "sweetie money" (as one poster calls it) contributions of 6.9%

CCW007

Definitely prefer the "sweetie money" contributions - mine will go up to 8.5% but it's still peanuts compared to the benefits.  

Credit card statement will be generated today / tomorrow so after failing to account for my grocery spends this month I am committing to keep track next month and set myself a budget of £250 for food, toiletries, cleaning products and medicines.  Hopefully having to track it will make me more mindful about spending as well!

Hopefully got someone collecting something I've sold on FB marketplace on Thursday - will be £15 in the kitty.  Am going to do the car boot next weekend so that will give me time to sort out stuff to sell and hopefully pick up / borrow a clothes rail.

Penultimate week in current job - two weeks time I will have finished my first day in new role - very scary and exciting in equal measures!  

CCW007

Epic MSE fail yesterday - forgot to take tea, milk or a mug to the office.  Thankfully there is an Aldi near the office so figured I could pick up tea and milk there and hope there was a spare mug at work but even better I managed to get a pack of two mugs for £1.49 in the middle aisle.

GC - £4.43.  Got an online order with Ocado coming tomorrow so trying to make sure it covers everything we need so I don't need to do any "I'll just pop to Tesco's" shops.  

Mortgage payment made - balance is now £331,196.91
Sub account 1: £256,908.57
Sub account 2: £74,288.34

savingholmes

You are making good progress overall. I would love some land. Sounds like you are in a great location. Good luck in your new role.

CCW007

Been a long while since I posted.  Exciting financial news didn't materialise but actually I'm relieved and it was our decision to halt the plans so back to focusing on the mortgage and retirement fund.

Have started new job, seems to be going well so far.  Tax code is messed up so it will take a few months before I get to see my new takehome pay.

I found out I need to transfer my previous LGPS pot into the new LGPS scheme but as they are identical I can't see this being a problem.  I'll get the transfer valuation and compare it to my estimate before I made the decision though. 

I also have the opportunity to buy extra pension but I need to look into it carefully before making a decision as I am quite flexible about when I take my DB pension - I'm hoping to stop work at 55 - 60 but not take the DB pension until SPA but this could change.  My SIPP and S&S ISA give me more flexibility about when I access them but the DB gives me the most benefit as a HRT payer.  Which reminds me, I need to look into tax relief for my SIPP now that I've moved into the HRT band.

The change in financial plans means that we currently have about £70k in savings (offset against £18k stoozed at 0%)  We are currently earning 1.3% interest, against 1.74% interest payable on the mortgage but given the mortgage is fixed for 10 years, I suspect that we will soon be earning more interest on the savings than we pay on the mortgage so plan to keep this effectively "offset", using it for renovations to the house as needed and then topping back up.

Got this week booked off, hoping to make lots of progress on the house and have some downtime.  Will definitely be making time to catch up on diaries - I haven't been on here in over a month!

CCW007

2nd June 
Sub account 1 - £256,062.43
Sub account 2 - £74,043.16
Total - £330,105.59

Reduction - £1,091.32

Debsnewbudget

Make sure your new pension scheme terms and conditions are the same as your old scheme before you change. I know with mine that service before a certain date counted differently to service after.

savingholmes

Also - consider whether to opt for AVCs which can give a tax free lump sum - or a later option of buying additional pension. This then gives you more flexibility for the future. Also when you are a new joiner to the scheme - you potentially have the option to transfer in other pensions - so could be worth investigating.

CCW007

Thanks both.  All my contributions are post 2014 so the scheme will be the same.  I do have the option to transfer in pensions but don't want to transfer in my SIPP as that gives me flexibility. 

I have requested a transfer in value for my previous LGPS pot (currently projected to be just over £6k PA if taken at SPA.  However I am actually considering keeping them separate.  If I were to leave new job within 2 years I would have to withdraw my contributions and I don't know what this would mean for my existing pot (or even whether this would apply as I have continuity of service).  But more importantly, I like the idea I could take one LGPS pot early and leave the other to SPA.  Keeping them separate may give me more flexibility.

Expensive spendy couple of months so no OPs.  Should get a tax rebate at end of month as my tax code got messed up when I changed jobs but is now sorted.