Best use of £20000 a year for retirement

Qwerk1972

Hello, 
I’m looking for some advice. I’m fortunate to be able to save £20000 a year and I’m currently putting this into a cash isa. However I’m looking forward to when I retire and I’m wondering whether to just live off this money when I retire, or am I better to invest it in a property (when I’ve saved up enough) and rent it out and live off that instead? 

Any other suggestions would be greatly appreciated.

Dazed_and_C0nfused

Qwerk1972 said:

Hello, 
I’m looking for some advice. I’m fortunate to be able to save £20000 a year and I’m currently putting this into a cash isa. However I’m looking forward to when I retire and I’m wondering whether to just live off this money when I retire, or am I better to invest it in a property (when I’ve saved up enough) and rent it out and live off that instead? 

Any other suggestions would be greatly appreciated.

Have you considered a pension?

Depending on how much you are currently earning you could turn your £20k into £25k within the pension and 25% could be taken as a TFLS when you come to retire.

Albermarle

If you have employment earnings then best place to save for retirement is normally a pension, due to the tax breaks.
Also pension money is normally held in investments and over the long term the return should at least beat inflation and a bit more, unlike cash savings.

mebu60

Qwerk1972 said:

Hello, 
I’m looking for some advice. I’m fortunate to be able to save £20000 a year and I’m currently putting this into a cash isa. However I’m looking forward to when I retire and I’m wondering whether to just live off this money when I retire, or am I better to invest it in a property (when I’ve saved up enough) and rent it out and live off that instead? 

Any other suggestions would be greatly appreciated.

No.

How old are you and what are your existing pension arrangements? 

HedgehogRulez

If only there was a tax advantageous product that caters specifically for retirement planning….

LHW99

If you don't have employment earnings, you can still put £2880 in a pension and get the tax relief - and an S&S ISA would be better than a cash ISA for building up a retirement fund with the rest.

Yorkie1

Many experienced landlords are getting out of the market, with changes to taxation and legislation here already and on the horizon. Buy to let is not the 'easy option' that many people think it might be.

If you want to put some details about your age, current savings, current pension provision, people might be able to add more detailed feedback for you.

solidpro

We've had and have a buy to let and I wouldn't get another.

onomatopoeia99

Please state what your pension arrangements are because that information is fundamental to answering the question as posed.

Having friends that rent and listening to their experiences of BTL landlords, don't do that.  It's good to hear from replies here that many amateur landlords are getting out of the market, hopefully that will weed out some of the dross.

ChadValley

(1) Renting includes buying an asset which creates problems when trying to cash in, 
(2) Putting your money in a pension limits your options and the goverment can always change the %.
(3) Putting a lump sum in your pension 6-12 months before you cash in means you get the tax benefits without locking your money up for years.
(4) Add up all your savings and projected savings then add your pension pot to this minus tax liability, then divide this by 20 years and ask yourself if you need to make risky complicated investments.
(5) if you retire on just a state pension you can earn an extra 5k in interest from cash investments ( minus income upbove your personal allowance)
(6) If your bank account has more than 85k in it you can put the unprotected amount into premium bonds, this is almost an instant access acount without interest. .

Aretnap

mebu60 said:

Qwerk1972 said:

Hello, 
I’m looking for some advice. I’m fortunate to be able to save £20000 a year and I’m currently putting this into a cash isa. However I’m looking forward to when I retire and I’m wondering whether to just live off this money when I retire, or am I better to invest it in a property (when I’ve saved up enough) and rent it out and live off that instead? 

Any other suggestions would be greatly appreciated.

How old are you...

Going to really stick my neck out and say 53 or thereabouts.