Live now or save for then?

Grumpysally

Do you both see yourselves working in the NHS till retirement?
Will either of you take a career break / drop your hours once you have children?
These are things to take in to consideration. 

mark55man

Late to the party, but I would add that you are well on the way to a comfortable retirement, with or without kids, but you are probably not on the way to an early retirement.  I was in a private company with a DB pension and I didn't think twice about pensions as I knew I was lucky.  It wasn't until (like most blue chips) they stopped the DB and we moved to a DC that I realised that had I carried on sleep walking I would have been unable to retire until 65 as I had not other assets outside the DB.

So its a choice - spend a little more now, and reduce flexibility later (taking early retirement on the NHS and working the bank isn't quite the same as retiring early).  Only you can know what your older self would want.  For me I could go at 60 and it would be tight, but knowing I can go - even right now - means I can enjoy and shape my work in a way that I couldn't if I was worried for my job - this last point is also a reason to have a larger EF than you might anticipate its not just for household emergencies it can be for life-choice emergencies   

saucer

PennyForThem_2 said:

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.)

Most people in care homes in the UK have dementia (70% according to Alzheimer's Society).  I would also emphasise that it is wrong to assume that people with dementia 'won't care'.   People with dementia very often express behaviour that is highly suggestive of distress that they cannot adequately communicate.  It might be reassuring to think that if you had dementia you wouldn't experience stress and distress, but it is a fallacy. 

There is a very marked difference between a good care home and a bad one, and it is not always obvious or related to cost. It is good to be in the financial position to be empowered to choose between them or to have the choice made for you by people who know you and love you. 

Dansmam

Only you can know what your older self would want.  For me I could go at 60 and it would be tight, but knowing I can go - even right now - means I can enjoy and shape my work in a way that I couldn't if I was worried for my job - this last point is also a reason to have a larger EF than you might anticipate its not just for household emergencies it can be for life-choice emergencies   

Life-choice emergencies! Exactly this. Nothing more valuable than the freedom to make an emergency life choice 😃

Flugelhorn

I topped up my NHS pension with FSAVC (as they were in those days) - now I can't touch the pot without ginormous tax bil as I breached the LTA on NHS pension. If I had known I would have spent the extra money instead.

Albermarle

Flugelhorn said:

I topped up my NHS pension with FSAVC (as they were in those days) - now I can't touch the pot without ginormous tax bil as I breached the LTA on NHS pension. If I had known I would have spent the extra money instead.

Presumably this ginormous tax bill, will have to be paid at some point anyway ?

horsewithnoname

Haven't read the whole thread, but one thing to bear in mind is what you think you might want to do in retirement might change. I was definitely going to do more travelling, and while the will may be there, the arthritis prevents it from being a pleasure now! So I'm glad I travelled quite a bit when I was younger, but, oh well, I'll never see the pyramids or the valley of the Kings bar on telly. Having said that,  have a reasonably comfortable life as I'm not extravagant anyway. So I'd say, enjoy yourselves while you can, but still have an eye on not being totally skint in the future. So my pension lump sum didn't take me on a Nile cruise, but my word the downstairs toilet is a lot more use to me now!

dunstonh

Flugelhorn said:

I topped up my NHS pension with FSAVC (as they were in those days) - now I can't touch the pot without ginormous tax bil as I breached the LTA on NHS pension. If I had known I would have spent the extra money instead.

But you are talking in excess of a million pounds.   Not many people get to that level.  That gives you a lot of choices and comfort in later life 

 And in reality, IHT is greater in net terms than the LTA excess charge.

barnstar2077

horsewithnoname said:

Haven't read the whole thread, but one thing to bear in mind is what you think you might want to do in retirement might change. I was definitely going to do more travelling, and while the will may be there, the arthritis prevents it from being a pleasure now! So I'm glad I travelled quite a bit when I was younger, but, oh well, I'll never see the pyramids or the valley of the Kings bar on telly. Having said that,  have a reasonably comfortable life as I'm not extravagant anyway. So I'd say, enjoy yourselves while you can, but still have an eye on not being totally skint in the future. So my pension lump sum didn't take me on a Nile cruise, but my word the downstairs toilet is a lot more use to me now!

This is what I say to people at work, even if you love your job you don't know what your boss will be like when you are older, or what ailments you will have.

Having a bit of money later in life means you have flexibility (and hopefully improved confidence/mental wellbeing.)  The flexibility to reduce your hours/days, to change jobs without worry, or to stop completely if you need to (and the confidence to tell a particularly unpleasant boss that you have too much money in the bank to be bullied by them! :  )   

Flugelhorn

dunstonh said:

Flugelhorn said:

I topped up my NHS pension with FSAVC (as they were in those days) - now I can't touch the pot without ginormous tax bil as I breached the LTA on NHS pension. If I had known I would have spent the extra money instead.

But you are talking in excess of a million pounds.   Not many people get to that level.  That gives you a lot of choices and comfort in later life 

 And in reality, IHT is greater in net terms than the LTA excess charge.

It isn't really a  million  pounds that is just an equivalent value The tax on the extra pot will be paid when I hit 75 -point  if I had known that there was going to be a  limit to saving in a pension in the future then I wouldn't have saved the extra