Live now or save for then?

[Deleted User]

Albermarle said:

My view would be to live a full family life. With two NHS pensions and two state pensions things will be fine. You do not need some of the eye watering amounts that some on here consider essential for a happy lifestyle.Personally I have  been semi-retired since I 58. I choose to work very part-time as I enjoy working in education. However, I do not need the money to live. Without it I could cope very well on my pension of about 20000 a year 

If you do not have a DB/final salary pension, then to generate a pension of £20K pa with inflation linking, would mean a DC pension pot of between £500K and  £600K would be needed ( less than it was a year ago) . So quite an eye watering sum.........

To be fair the amount at 58 was less 6 years ago. I also paid in for additional pension for 2 years after that. I worked full time a total of 38 years on a fairly good salary and made quite high contributions to the scheme. 

bostonerimus

Adamc said:

bostonerimus said:

Do a budget and plan what you will save and how much you will spend on things like holidays. From your email it sounds as if your spending is a bit out of control. Balance is the key, you need to enjoy life at all stages and but also have the finances to provide for your security in the future.

Just to clarify. Spending isn't so much out of control but saving while paying off a holiday in full is impossible for 1-2 months. As we're going on several that means no saving for 6 months-ish.

 It's just now travel restrictions have been removed we've been making up for lost time with some wonderful holidays (trips to the States and resorts etc). This has meant we've paused saving.

Contemplating a Japan trip probably means pausing saving for the rest of the year ...  I have a 20k rainy day fund that I don't touch but need to look at investing some of it more productively (separate matter (SSI / LISA)). There's always going to be some expense or improvement to considered hence me thinking on this matter.  

All overheads such as mortgage + overpayment, car, etc covered and no debt other than student loan. 

I have overtime available so I may do some to fund the Japan trip and allow saving to continue.

I don't think you're being honest with yourself. I go back to my suggestion - do a budget that allows you to save at the right level to fulfill your FIRE plan, if that's what you really want. Importantly your partner has to buy into the plan as well. If you are going to work overtime so you can save and have the holiday in Japan I think your partner should want to do the same, otherwise resentment is a possibility and that isn't good.

Grumpy_chap

The holy grail answer to the OP's question is to have sufficient income to be able to live now without restriction and save for the future.
Many films have been made about the search for the holy grail.

Albermarle

One aspect that I think has not been mentioned is early retirement.  The more money saved now the greater the time available to do things you enjoy.  You should bear in mind that even if you enjoy work now after 30 years coping with the stress of deadlines, office politics, and bizarre management decisions you may be desperate to stop.  The worst possible situation I believe is being in that situation but not having the means to do other than wait until you are 68.  There is a real danger that such ongoing pressure  reduces your life expectancy.

My main reason for saving and controlling expenditure, was so I could walk away from my reasonably well paid job if the hassle got too much/ got a new bad boss. This was more of a driver then the more general prospect of retiring early.

In fact the latter part of my career worked out OK, so was able to use the funds to retire early(ish) anyway .

Kim1965

The certainty of db inflation proofed pension puts the op in a great position. 
It seems the norm in the nhs is to take thedb scheme at 55 and work pt on the bank. If you dont want this then a sipp to buy early retirement is a good idea

DT2001

Like Pollycat we have travelled and saved. We are both self employed with quite variable income so put money aside for holidays knowing the regular income will cover ‘normal’ expenditure. Before children we worked more jobs/hours and the pleasure of holidays to come helped get through the inevitable downs in life. So I do not think it is save or travel (and the OP has built up a rainy day fund).
When you have children unless you both continue to work full time your pensions will build up more slowly.
Planning with contingencies is the key IMO but on a general level by which I mean : -
1. When do you want to retire
2. Depending on 1 will affect how you budget now
3. Property - do you need to upsize for children, can you rent a room out before children to fund a ‘Japan type trip’, will you downsize on retirement releasing funds
4. Children - how many, private education, help with Uni, house deposits etc

Some on this forum are very focused on FIRE others doing OMY so I think it is important to know yourselves. What plan will you adopt and be happy to stick by as far as possible.

We have 4 children, can retire before SPA (but enjoy current contracts/work) and travelled with them (from babes in arms to Europe, Arabia, Asia, Australasia and N America) just need to be organised and ignore the parents going “we can’t go it’s too far/difficult”.

Wandered off thread - budget to save and travel!

diystarter7

Just keep a good, tighter regime of saving when you start out with the first home then losen up but always have at least 10k in the bank for a rainy day.  I can't recall the time when we had less than ten k in cash/bank and more than 30 years with a lot more than that.

Just gives you confidence if things are not going to plan.

Btw, plenty into pensions or BTL to retire at 50 if you can and at least by 50 - its easily done when you are sensible from the outset.

newatc

Out for a walk this morning and thinking back on my life I thought about things I regretted doing and things I regretted not doing. 
I came to the conclusion that the regrets over not doing things (particularly when I was relatively young) hurt most.

PennyForThem_2

DT2001's list of stuff to think about is a start.  I would add:

5.  What happens to your finances if your partner/you die - is the survivor provided for adequately? 
6.  'Dementia' covers a load of health reasons why you may need care in your home or in a specialist care home.  However what if you need a replacement hip/knee, other health intervention for which the waiting list on NHS is horrendous - do you have enough in savings to go private?  I would not want to wait 4-5 years for a hip replacement with all the loss of quality of life that goes with hip/knee problems.

(Agree that if you have dementia actually you won't care - harsh as that may sound.)

Plasticman

When we were younger we spent more of our income - especially when the kids were young. Lots of days out and holidays, not travelling the world but making happy memories. Neither of us have really ever cared about having a new car or designer clothes so compared with some people we've probably always looked a bit frugal. When it comes to day to day bills and spend I'm very tight because that's where the money seeps away and you see nothing for it!!

When I was younger I would have loved a bigger house but now that we're in the position where we could borrow more to buy one, I really don't want the debt and would prefer to stay where I am and retire earlier. The bottom line is that you need to do what makes you happy but understand the consequences. There's no point in being miserable now so that you can be happy when (if) you get old.