Obsessed with pension planning and saving?

SouthCoastBoy

Phossy said:

SouthCoastBoy said:

LLShef said:

Apricota said:

It’s got to be about the balance also. I have two kids, now just at uni, expensive years still. Have the mortgage all paid off and again worked hard for that. Just keep going really. I agree ref kids and when they might need there own places, would love to be able to help. 

I plan for my kids to take max student loan and what I save for them goes into buying a place for them instead (where we are is great for university or NHS jobs but it seems they will need to live somewhere else for their future jobs). We have to borrow one way or another; both are expensive but rent/ mortgage/ housing costs we have to pay certainly, whilst student loan is to be paid back based on their work salary.

Depending where you live the max student loan may not be much, my daughter gets a touch over 4k, not sure of exact amount. Her accommodation alone is over 8k

The 4k is not to do with where you live, that's because your household income is over a certain amount. Max loan is 9.25 k

The rules are different in Wales, Scotland and England. 

QrizB

SouthCoastBoy said:

Phossy said:

SouthCoastBoy said:

Depending where you live the max student loan may not be much, my daughter gets a touch over 4k, not sure of exact amount. Her accommodation alone is over 8k

The 4k is not to do with where you live, that's because your household income is over a certain amount. Max loan is 9.25 k

The rules are different in Wales, Scotland and England. 

Nevertheless, the loan is means-tested and students from high-income households like yours receive smaller loans. If you were broke your daughter could be loaned the numbers in my previous post.

SouthCoastBoy

QrizB said:

SouthCoastBoy said:

Phossy said:

SouthCoastBoy said:

Depending where you live the max student loan may not be much, my daughter gets a touch over 4k, not sure of exact amount. Her accommodation alone is over 8k

The 4k is not to do with where you live, that's because your household income is over a certain amount. Max loan is 9.25 k

The rules are different in Wales, Scotland and England. 

Nevertheless, the loan is means-tested and students from high-income households like yours receive smaller loans. If you were broke your daughter could be loaned the numbers in my previous post.

It depends on the country, in Wales if parents have a high income students will get a bigger loan and smaller grant. https://www.studentfinancewales.co.uk/undergraduate-finance/full-time/welsh-student/what-s-available/

So the amount received by the student doesn't alter, just the ratio between loan and grant changes.

Ibrahim5

It can be a bit strange. We are millionaires but officially have a low income. So ours took the maximum loans, got bursaries and free laptops etc because we are a low income household. Savings and investments are never checked, just income.

LeafGreen

Ibrahim5 said:

It can be a bit strange. We are millionaires but officially have a low income. So ours took the maximum loans, got bursaries and free laptops etc because we are a low income household. Savings and investments are never checked, just income.

Are the returns from savings and investments not considered as income?  

Albermarle

Phossy said:

Albermarle said:

In fact the maximum for a student living away from home at a London Uni, with parental income below £25K , is £13,022.
The average loan is £6K
Each country of the UK has different rules.
Typical overall cost of living away is around £11K, so typically £5K per year extra has to be found from somewhere on average Less for some and more for others.

Can you give some more detail behind that £13K figure please. We are looking at loans now for my son and I want to make sure I haven't missed anything. I have worked on the numbers given here (outside of London) Student finance: how you're assessed and paid 2024 to 2025 - GOV.UK (www.gov.uk)

Student Finance Maintenance Loans 2024 - Save the Student

Ibrahim5

grahamgoo said:

Ibrahim5 said:

It can be a bit strange. We are millionaires but officially have a low income. So ours took the maximum loans, got bursaries and free laptops etc because we are a low income household. Savings and investments are never checked, just income.

Are the returns from savings and investments not considered as income?  

Returns from ISAs aren't, but any non ISA is. The forms aren't very clear and I think they are happy to include the ISA's income if you put it on the form. A bit of googling and it becomes clear that you don't declare ISA income.

FIREDreamer

grahamgoo said:

Ibrahim5 said:

It can be a bit strange. We are millionaires but officially have a low income. So ours took the maximum loans, got bursaries and free laptops etc because we are a low income household. Savings and investments are never checked, just income.

Are the returns from savings and investments not considered as income?  

Yes, but not if held in an ISA.

Archerychick

FIREmenow said:

Has anyone else gotten obsessive over their pension?

Reading up on, and understanding my own pension options was a bit of a lifeline for me when I was on mat leave - I think my brain needed something different to keeping a baby alive to grab onto.  Now, my salary sacrificed pension contributions seem by far the most efficient use of my spare income with NI and student loan savings, so it can be hard justifying doing anything else with the money!

If you are naturally frugal/good with money, and have some disposable income, how do you know when to stop with the pension contributions and enjoy some of the money now?  I'm looking for ideas for some kind of system of how to portion up my spare money.

I am becoming more obsessed, but also apprehensive.

I’m probably c10-15years away from retirement and I’m excited about it! I love my job but to not have to go to work everyday is quite appealing and I have enough interests outside of work to keep me occupied.

I’ve been focussing on investing in the house and all the big jobs are done, and I have 21 months left until the mortgage is paid off. From this year I will be paying in the maximum allowed into my work pension and hopefully I can utilise some allowance I haven’t used in the last few years too.

Ive been working on what I think I need to live on  during retirement and that obviously starts by understanding what you need now. Last year I spent £18k excluding mortgage. The next step is working out a budget that also factors in things like a new car, more holidays, and without the latter I still only get to £21k. That makes me realise that I really don’t need that much to live on, I’m very happy with my quality of life and feel I have everything I need. A lot of this is absolutely because I was brought up to understand the value of money and i won’t spend unless it is something that’s required.

What am I apprehensive about? I very much do not understand pension investments and I’m concerned whether standard approach is the right one, so given the importance of this I need to see a IFA for the current approach to be reviewed so I can satisfy myself where the money is invested it good. If there was a qualification to understand this better I think I’d probably consider it!

Pat38493

Archerychick said:

FIREmenow said:

Has anyone else gotten obsessive over their pension?

Reading up on, and understanding my own pension options was a bit of a lifeline for me when I was on mat leave - I think my brain needed something different to keeping a baby alive to grab onto.  Now, my salary sacrificed pension contributions seem by far the most efficient use of my spare income with NI and student loan savings, so it can be hard justifying doing anything else with the money!

If you are naturally frugal/good with money, and have some disposable income, how do you know when to stop with the pension contributions and enjoy some of the money now?  I'm looking for ideas for some kind of system of how to portion up my spare money.

I am becoming more obsessed, but also apprehensive.

I’m probably c10-15years away from retirement and I’m excited about it! I love my job but to not have to go to work everyday is quite appealing and I have enough interests outside of work to keep me occupied.

I’ve been focussing on investing in the house and all the big jobs are done, and I have 21 months left until the mortgage is paid off. From this year I will be paying in the maximum allowed into my work pension and hopefully I can utilise some allowance I haven’t used in the last few years too.

Ive been working on what I think I need to live on  during retirement and that obviously starts by understanding what you need now. Last year I spent £18k excluding mortgage. The next step is working out a budget that also factors in things like a new car, more holidays, and without the latter I still only get to £21k. That makes me realise that I really don’t need that much to live on, I’m very happy with my quality of life and feel I have everything I need. A lot of this is absolutely because I was brought up to understand the value of money and i won’t spend unless it is something that’s required.

What am I apprehensive about? I very much do not understand pension investments and I’m concerned whether standard approach is the right one, so given the importance of this I need to see a IFA for the current approach to be reviewed so I can satisfy myself where the money is invested it good. If there was a qualification to understand this better I think I’d probably consider it!

There is - you could study to become a chartered financial planner!   However this might be overkill because you only need to understand the options that might be relevant for your situation.

A simpler start is to read a book about it E.g. Tim Hale’s book on smarter investing.