Is what I am doing sensible? What would you do

Storcko14

https://forums.moneysavingexpert.com/discussion/comment/81976437#Comment_81976437

It's an option and I believe you're correct about MPAA as long as it's not a reducing annuity.

LHW99

You've won the game (personally and as a couple) but does / will your partner have enough pension to use all her basic rate band?

What about inheritance tax after second death? After 2027, pensions will be included in the calculation.

Maybe an IFA could add value for you in terms of tax planning (there are more things than ISAs and PBs that can give tax advantages), IHT planning and general cash flow.

Veloflyer

Pay off the mortgage and any other debts?

Too much in equities. Too risky. ILG ladder would be my choice for providing a less risky foundation for your present and future basic spend. The rest could remain in equities - with carefully chosen funds to suit - as bunce for holidays/cars etc. Also useful to have some spare cash in case of immediate emergencies.

dunstonh

thanks for the advice re gilts. Whenever I’ve looked at those, at least the gilt funds available within the workplace pension wrapper the the performance looks awful often significantly losing value. The money market funds seem to do so much better at least generally keeping pace with inflation

Gilt funds have had a 1 in 100 year reversal after spending 13 years in a boom period that created a significant bubble. That bubble burst, as most bubbles do.

I get it that if you buy a proper index linked gilt and hold til maturity you can’t really lose but those only seem available in a sipp or isa - workplace pension schemes only seem to offer gilt funds which don’t seem to perform great

Gilt funds have outperformed money market funds over the long term and even with the bubble bursting, they still outperformed money market over the medium term.

You need to look forward, not backwards. Past performance is not a good to future returns.

BobbyFrench

Looks good to me.
If I were in your position, I’d:

• pay down the mortgage
• up the ISA to provide that bridge until you can access the pension
• look to increase the LGPS as it provides good value at low risk - also to make use of your partner’s personal allowance and possibly lower tax rate in retirement.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81976346#Comment_81976346

Gilt funds vs money market funds. The key is interest rates. If they drop the gilt funds will increase in value, and the return from MM funds will drop. .

Otherwise my takeaway from your OP is you maybe need to work on this .

We live a relatively modest lifestyle.

Quite a few regular posters on here, have accumulated more assets than they can ever spend, as they are not natural spenders. Some of them, including me probably, will be the proverbial 'Richest Man/woman in the Graveyard'

Due to your relatively young age this imbalance between accumulation of wealth and spending it, is most likely going to grow, unless you have some big spending plans for the future maybe?

phlebas192

https://forums.moneysavingexpert.com/discussion/comment/81976346#Comment_81976346

It should be possible to do a partial transfer from your workplace DC scheme to a SIPP. So you could transfer the cash element and then buy ILGs in the SIPP.

Veloflyer

https://forums.moneysavingexpert.com/discussion/comment/81976812#Comment_81976812

I'd be very happy to assist anyone who feels they may end up being the richest person in the graveyard by relieving them of their tiresome burden of accumulated wealth/assets……

af1963

You don't mention a planned specific retirement age, other than "to retire ASAP". Your funds are quite heavily weighted in age-restricted accounts - pensions and LISAs. The limiting factor looks like the £82k in ISAs, which may need to fund you through several years before the pension is accessible.

You also have a chunk of equity tied up in the house, which it might be possible to tap into by remortgaging, as you'll have money available to pay back when the pension funds become accessible. Easier to do this while still working and bringing in salaries, if you think it's an option.

eskbanker

Also thinking if markets tank, and i mean tank (like the covid drop or early 2025 drop) i may use some of the 400K to buy back in at lower cost….. maybe…. (time in the market not timing the market etc……)

Just to return to this point, it's perhaps worth noting that neither of those crashes was particularly extreme in historical terms, especially their steep V-shaped recoveries, so it's always possible that equity markets can fall much further and take much longer to recover…