Anything else I should be doing (LGPS pension and AVC)

sg1000

Hi Everyone,

Just want a reality check.  My wife has retired (from the NHS) and currently receives a pension of 17k per year.  I am paying in to the LGPS in relation to two jobs that I have had, one ful time since 1994, then split with the other since 2007 (making up full time hours). 

Current pension forecast for me is 30K at age sixty with a lump some of 30k (amalgamation of both jobs). I am also paying salary sacrifice to AVCs of £1233, although this is made up of £1232 from my employer and £1 from me.  I get the NI savings, too from salarly sacrifice.  The AVC pot is currently standing at 49K.

I currently earn around 62k per year (combined for the two jobs).

I aim to retire at 60 and am now 55.

The mortgage on our main home has been paid off recently, although we still have a mortgage on a second property, not let out or a holiday home.  It is in the area where my wife was brought up and we use it for ourselves whenever possible (value 180K, mortgage currently 80K with repayments interest only).

Savings are currently, 50k (wife, NS and I) and 71K, me ( S and S Isa).  The S and S Isa is being added to at £500 per month and my wife's NS and I account is being added to by 1K per month (now that the main mortgage has been paid).

Anything else I should be doing to make the most out of retirement?

Thanks,

sg1000 

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Dazed_and_C0nfused

Is your wife adding £2,880 to a RAS pension each year?

sg1000

No, but she should be, D and C....what she does finacially is a bit of a bone of contention :-)

Dazed_and_C0nfused

sg1000 said:

No, but she should be, D and C....what she does finacially is a bit of a bone of contention :-)

Well she would get £720 in basic rate tax relief and only have to pay £540 in tax when taking the income out so an easy £180 profit every year until she's 75.

Or she could leave the fund in place just accumulating the free £720 each tax year.

Provider fees are a key thing to look out for if paying in, not investing the fund and taking it out in short order.

sg1000

I have shown her your post, D and C. You have achieved something in five minutes that I coudn't in eighteen months...Thanks very much!!

Silvertabby

Have you checked your wife's State pension forecast?  With that level of contracted out service (NHS pension scheme) she may well be short of the full £185.15 per week.  If so, then paying voluntary NI contributions between when she left the NHS and SPA is well worth doing.

Don't just assume that because she has more then 35 years of NI contributions then she will be ok.  The oft quoted 35 years only really applies to those who started work after April 2016, with the rest of us being under transitional arrangements.  In my case, I needed 48 years of NI conts (44 years from working and 4 years of paying voluntary Class 3s) in order to qualify for the full whack. 

Dazed_and_C0nfused

sg1000 said:

I have shown her your post, D and C. You have achieved something in five minutes that I coudn't in eighteen months...Thanks very much!!

This forum comes up trumps again 😃

sg1000

Thanks, Silvertabby...yes, we know she has two years more to pay, which we will do with the additional voluntary NI contributions

german_keeper

Without doing any detailed calculations. or knowing what sort of income you want in retirement, I think I would just say if for some reason you want to keep on working then do so. I am currently trying to persuade my wife to retire and I can't decide if she isn't ready to retire or just doesn't really believe me when I tell her we have got enough.

But assuming 2 full state pensions are in the bag, if you fancy retiring now just crack on!! The numbers look good to me. And don't look on actuarial reduction as some sort of "penalty," it just means that if you live to average life expectancy you should break even give or take.

sg1000

No plans to retire just yet, GC, 60 is the goal and I just want to make sure I can build on what I already have.  Just wish I had concenrtated on pension provision more when I was younger!

Thanks, All.

SarahB16

sg1000 said:

No plans to retire just yet, GC, 60 is the goal and I just want to make sure I can build on what I already have.  Just wish I had concenrtated on pension provision more when I was younger!

Thanks, All.

Don't be too harsh on yourself.  If provision is made for your pension then it can't be can't be accessed without penalties until you are older.  You still need to having savings available for when you are younger as you never know what is round the corner.

I'm sure there are many of us on here (I know I am one of them) that regret some of the financial decisions we have made but we can't keep thinking I wish I had done this or hadn't done that.  Instead, we've got to look forward and make the best decisions going forward.  Hindsight is a wonderful thing but second to that is reading the MSE forum!