Investment Advice

doire_2

Hello,

I'm just looking for some advice on my next steps after clearing the mortgage.. I'm 47 and finally paid off my mortgage.
Ive got a pension which I pay 5% and employer does the same. My wife has no pension
We have a cash ISA of 35k which we top up each month.. I plan to transfer this to another provider.
Each month we can save roughly 2k. What would you do with this? Add to my pension, our exiting ISA or a S&S ISA?

Thanks

James811

Spreading out is often good advice. I assume you have a cash emergency fund? I have one which I've moved into premium bonds for the chance of a win. If you increase your pension contribution does your employer still match is as that's likely a good option before doing your own thing with your spare cash afterwards 

doire_2

Yes we have a few months salary as an emergency. Unfortunately my employer will only go to 5% for the pension

Dazed_and_C0nfused

doire_2 said:

Hello,

I'm just looking for some advice on my next steps after clearing the mortgage.. I'm 47 and finally paid off my mortgage.
Ive got a pension which I pay 5% and employer does the same. My wife has no pension
We have a cash ISA of 35k which we top up each month.. I plan to transfer this to another provider.
Each month we can save roughly 2k. What would you do with this? Add to my pension, our exiting ISA or a S&S ISA?

Thanks

Assuming you are a basic rate taxpayer now and will be in retirement then a pension will beat an ISA because of the tax relief when paying into a pension and 25% TFLS when eventually taking the pension.

If your wife has no pension (presumably from not being employed) then you should look at how you can make use of her Personal Allowance - pension contributions may be limited due to not earning but she may be able to take them all back out without paying tax.

Potential for an easy £720 each tax year for her if she can fund a pension.

doire_2

Dazed_and_C0nfused said:

doire_2 said:

Hello,

I'm just looking for some advice on my next steps after clearing the mortgage.. I'm 47 and finally paid off my mortgage.
Ive got a pension which I pay 5% and employer does the same. My wife has no pension
We have a cash ISA of 35k which we top up each month.. I plan to transfer this to another provider.
Each month we can save roughly 2k. What would you do with this? Add to my pension, our exiting ISA or a S&S ISA?

Thanks

Assuming you are a basic rate taxpayer now and will be in retirement then a pension will beat an ISA because of the tax relief when paying into a pension and 25% TFLS when eventually taking the pension.

If your wife has no pension (presumably from not being employed) then you should look at how you can make use of her Personal Allowance - pension contributions may be limited due to not earning but she may be able to take them all back out without paying tax.

Potential for an easy £720 each tax year for her if she can fund a pension.

She is employed but her work place only offers the work place pension so he opted to put money into our ISA instead 

So would it be better saving mostly into the work pension in my name?

grumiofoundation

doire_2 said:

Dazed_and_C0nfused said:

doire_2 said:

Hello,

I'm just looking for some advice on my next steps after clearing the mortgage.. I'm 47 and finally paid off my mortgage.
Ive got a pension which I pay 5% and employer does the same. My wife has no pension
We have a cash ISA of 35k which we top up each month.. I plan to transfer this to another provider.
Each month we can save roughly 2k. What would you do with this? Add to my pension, our exiting ISA or a S&S ISA?

Thanks

Assuming you are a basic rate taxpayer now and will be in retirement then a pension will beat an ISA because of the tax relief when paying into a pension and 25% TFLS when eventually taking the pension.

If your wife has no pension (presumably from not being employed) then you should look at how you can make use of her Personal Allowance - pension contributions may be limited due to not earning but she may be able to take them all back out without paying tax.

Potential for an easy £720 each tax year for her if she can fund a pension.

She is employed but her work place only offers the work place pension so he opted to put money into our ISA instead 

So would it be better saving mostly into the work pension in my name?

No it would be better for your wife to pay into her workplace pension, not doing this is throwing free money away.

dunstonh

She is employed but her work place only offers the work place pension so he opted to put money into our ISA instead 

That is throwing free money away.  Plus, pension beats ISA in terms of tax efficiency for the vast majority of people.

eskbanker

doire_2 said:

We have a cash ISA of 35k which we top up each month.

doire_2 said:
he opted to put money into our ISA instead 

Just to be clear, the 'I' stands for Individual, i.e. ISAs are associated with one person, not two, so either you both have your own ISAs, or just one of you does in his/her sole name....

Albermarle

She is employed but her work place only offers the work place pension so he opted to put money into our ISA instead 

I do not really understand what you mean by the comment in bold. In general a workplace pension is as good as any other pension. There maybe some minor pros and cons, but she is throwing away free money by not contributing to it.