Investment advice/opinion - pensions?

lionel_hutz

Just want to bounce around my future pension/investment thoughts to see if it seems a good strategy!
I’ve always had an interest in buying a small property to rent out, as a way of diversifying my income when I retire. I know withdrawal of tax breaks, energy saving regulations etc. make renting out a less attractive proposal financially, but I’d be happy to use some of the income I’d get from it to help pay the mortgage off so that when I retire it’s a regular income and I’m mortgage free.

I want to keep my investments diverse, I’m also aware that house price growth always outstrips inflation so the property value as an asset is growing.

I’m 48 years old (aiming to retire around 65) and a 40% rate tax payer so this would obviously affect income from a rental property while I’m working, though getting £40 tax relief to put into my pension for every £60 I put in (I have a private and work pension) makes the pension attractive. 

Would I potentially be better to keep putting as much as I can into the pension while I’m still working and gain the tax relief, then maybe my last 5 years of work save a decent chunk of my pension contributions as cash, then at 65 take a lump sum from my pension to buy the property outright and only rent it then as I’ll only pay 20% tax on the income? 
My current investment ratio is:
Pension 60%

Stock and shares in various funds 30%

Cash in savings accounts 10%

Albermarle

Probably better to make use of the 40% tax relief as long as possible, as it is very generous. You will be able to take out some money from your pensions from age 57. If you only take the 25% tax free cash, then you can continue to contribute normally to the pension after that.

In any case in 10years time your circumstances might have changed so you will have to review again then anyway.

retiringtoosoon

Pensions is the correct answer 

shortseller09

lionel_hutz said:

 I’m also aware that house price growth always outstrips inflation

Not always, have you looked recently?

Chickereeeee

Do you really want to take on the chore of managing a rental property when you retire? Just when you get more time to do what you want, when you want?  It's not for everybody, and it would be a shame if you found 'it's not for you' and waste a few years/money.