Resourcefulness: The budgeter's friend

foxgloves

Thanks, @Suffolk_lass - though I have to say that I found that very confusing 🤔….it's probably me, but I don't know what 'TFLS' is. I have taken both lump sums available to me in their entirety. My AVC fund was very small because I only paid into it for a couple of years. I have taken both that & all of my LGPS lump sum. I did say I had 'top-sliced' my AVC but that wasn't in the sense of me taking some money out of it & leaving the rest there, it wasn't sufficient to convert it into a meaningful annuity…in fact, given the very short amount of time I did pay into it, I'm surprised it provided the actual lump sum that it did! I like very simple straightforward things where money is concerned. I did read your suggestion a 2nd time very slowly & still didn't understand the process but thanks for thinking of me & my newly-retired needs! I am happy with how I have done things so far. I still have a few years to go before I am old enough for my state pension so have concentrated on getting my AVC money & work pension lump sum into savings.

F x

foxgloves

Hello Thursday Folk,

A mish-mash of a day really, but various things achieved & have also sat down with Mr F over a coffee & biscuits to look at what still needs doing in terms of holiday planning. I already had 3 lists so was annotating those, crossing off, etc, you know how it is! Continued our discussion on not eating out all the time we are away as it absolutely burns through the holiday expenses allocation & also, it does seem a shame not to make use of the beautiful old dining table & lovely view in the place we are staying so we added a few more foodie things to the list of gubbins to take with us. That's got to count as one of today's budget-friendly efforts. Others:

*Withdrew the cash I allocated for our emergency cash reserve. It was quite amusing deciding where actually to keep it.

*Mr F tested the new wind-up/solar radio which also has a torch & can be used as an extra phone charger. He thinks the radio reception isn't great, but I reminded him that it's an emergency gadget for tuning in to important info, not sitting down with it to listen to the collected works of Rachmaninoff. The light is really bright & he discovered an extra little solar panel which can be pulled out for additional charging capability. It was reduced by quite a lot& I think it will do the job, though like everyone else, I am very much hoping we don't have to use it for any horrid situations anytime soon, or indeed at all.

*Hair cut first thing. Prices have gone up but I am perfectly happy to pay a little extra for a good cut & I have thought for ages that they don't really charge enough. Still a very affordable amount.

*Treated myself to some magazines to put away for holiday reading - from my Personal Spends so budget-neutral.

*Entered a competition.

*Did a few surveys. I think I forgot to mention yesterday that I won some more points on the Ips£s daily spins - I was very cynical about these to begin with, but that was my 7th win of extra points & got me over the line for cashing out another £10 voucher today, which like last year, I am stashing as 'turkey tokens' ready for picking up the beast on Christmas Eve.

*Charity mittens STILL not finished. Last night I knitted the little pieces required to make the button decoration to finish them off then realised (der…..) that I'd only knitted enough for 2 mittens, not all 4, so I shall be doing that tonight. Also want to finish my current book (still the novel by Shirley Jackson) so as to decide which one from my 'to be read' shelf is likely to be coming on holiday with me.

Mr F's cooking night tonight & he is doing pesto pasta with salmon.

Times Soot removed from Hallowe'en window basket = 3

Times Soot knocked the little stuffed pumpkin out of the basket onto the floor = 2

Right, time to sign out & go & get those last few chapters read.

Stay cosy,

F x

PennysIntoPounds

If the country's on the rocks then we'll definitely need some Rachmaninoff. (This is possibly the most cultured joke I have ever made.) (I didn't say it was good, just well above my usual level 😁)

Which radio doodah did you go for?

Great stuff getting food to take so as to save spends and enjoy the location rather than eating out all the time. Hope the book choosing goes okay, I find it very stressful deciding what to bring to read while I'm away 😂

Baileys_Babe

@PennysIntoPounds said:

Which radio doodah did you go for?

Please tell, I was going to ask as well.

Sun_Addict

Still laughing at Soot’s antics, he’s really got it in for that Halloween display hasn’t he 🤣

Dakota_Rose

Love your Halloween basket - particularly that it’s both a seasonal decoration and pet entertainment station 😂.

Suffolk_lass

https://forums.moneysavingexpert.com/discussion/comment/82185771#Comment_82185771

It sounds more complicated than it is. I was trying to describe how to take the remainder of the AVC pot while minimising the tax you would pay on it.

As you say, it is quite small so it makes sense to divide the AVC pot up and take the lot before the tax year in which you reach state pension age. The timing is because the state pension added to your occupational pension will mean you pay income tax on your income after that.

If your income from your occupational pension is already above the tax threshold, the spreading it out does not apply - in which case, taking it this year (before April) is likely to be your best bet as your pension is only being paid for about half of the tax year.

As you say, you have taken the allowable part of both (maximum 25% and no tax is payable on it) also known as the Tax Free Lump Sum (that's what TFLS stands for) - this was just a way of dividing up the rest to have it in your pots, not stuck in a managed pot, where trying to take an income from it would cost management fees and you would derive minimum benefit.

The idea is to have it in your pocket and either minimise the tax or legitimately avoid it

I hope that is clearer and you will consider it.

Debsnewbudget

like Foxgloves I am taking my pension from LGPS

At the start you have the choice of larger lump sum or larger monthly pension but then that is it, no more lump sums.

I think thats the difference between a personal pension and a LGPS . I have just had the same discussion with my friend and she did not understand I couldn’t take any more lump sums out as I don't have that sort of personal pension..I think she now feels sorry for me and will offer to pay for our next lunch 😂

foxgloves

@Suffolk_lass - As @Debsnewbudget says, there are just those 2 options with an LGPS pension. There is no facility to keep taking chunks of lump sum at different times once the decision has been made to retire. My option was to take all of my lump sum as quoted & to leave my monthly pension amount unchanged & I am happy with that. I took all of my (small) AVC fund at the same time as a lump sum, as I always intended, so as far as I'm concerned, that is those figures & sums of work pension money done & dusted. There are no more pension monies of any kind coming my way until I reach state pension age, which is still quite a few years away. Sorry if you thought I was being dim….I just couldn't make what you were suggesting relate to my situation & it is probably because we are talking about 2 different pension schemes. Either that, or I need to increase my intake of fish oils!

foxgloves

Just a quick one from me today. I've whizzed through my task list, most of it bits & bobs I need to get done before we go away. Budget-friendly stuff:

*Grocery shop for a boxful of stuff to take with us to prevent too much expensive eating out. Under weekly target so the remaining Week 1 money can be added to our holiday expenses allocation. Back in the day, we used to bung everything holiday related onto a credit card - I SO much prefer it this way, I think I even enjoy being away more, knowing that it is all properly paid & accounted for.

*3 loads of laundry on heated airer. Quite sunny now the murk has cleared so a bit of a shame it didn't get pegged out.

*Pinged some birthday money to my nephew's bank account rather than risk losing another gift card in the post.

*First monthly work pension payment landed this morning. Peculiar looking tax code - investigated it by logging into my HMRC account & it's an emergency one. If it hasn't updated by next month's payslip, I will contact them. Credits on our online banking show up in green & it's always nice to sign in & see a green number twinkling away.

*Did a few minor budget updates just to keep everything straight after there's been a period of so many transfers flying around.

*Did a couple of surveys & cashed out of PA at £25-70. I still have last month's PA earnings sitting in P£YP£L so this will be a decent addition to my Personal Spends. Mr F says he's cashing out today too.

*Charity appeal mitts finally finished last night - just a matter of getting the embellishments sewn on. Now bagged & ready for donating. Plenty of yarn left for another couple of pairs if at some point I think they might make someone a gift.

Plus lots of other little odds & sods too numerous & dull to mention but satisfying nevertheless to cross off my catching-up list.

Right, that's me done. Am off in search of caffeine. Mr F has been cleaning the motor so I bet he's ready for one too.

Good Friday night wishes to all,

F x