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Pension or House Deposit?
Comments
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OP are you sure there is a local provider of the 30 hrs childcare who has space for your child?
A substantial amount of providers can't afford to provide it. If you do, great! And remember to budget for top-ups for food/travel etc. I read about one setting where the daily top up is £15
As a quick aside, CRV1963 you know you don't have to login to total rewards via the intranet right? We just the use government gateway ID we use for taxes/tax credits/self assesment: https://www.totalrewardstatements.nhs.uk/LoginSave 12 k in 2018 challenge member #79
Target 2018: 24k Jan 2018- £560 April £26700 -
Hi stoozie1,
I didn't know, but thank you- I'm learning all the time!
CRVCRV1963- Light bulb moment Sept 15- Planning the great escape- aka retirement!0 -
No problem. If you are anything like my OH there's rarely time at work to access the intranet, so I thought it might be handy.Save 12 k in 2018 challenge member #79
Target 2018: 24k Jan 2018- £560 April £26700 -
Going by the calculation on page 6 of this https://www.nhsbsa.nhs.uk/sites/default/files/2017-05/2015%20Members%20Guide%20%28V7%29%2005.2017.pdf
-Combined salary of £71,383 in year one, and then £77,698.60 until retirement at 68.
-Year one, 1/54th of the pensionable salary = £1,321.91.
-Accumulates +1.5% compound, for 32 years = £2,128.70 by retirement. I've not included the 'treasury order', as I have no idea what it realistically is, although the document gives it as 2%.
This adds up to a combined annual pension of £62,112.43. If I do use the treasury order example of 2% annually, it goes up to £87,909.94.
Before I open up a debate as to what to do with the money? Is this correct? This seems much higher than figures some others have given, although they all took 33k as my earnings - top of my band is closer to 41k, which I've assumed we'll stay on until retirement.0 -
Going by the calculation on page 6 of this https://www.nhsbsa.nhs.uk/sites/default/files/2017-05/2015%20Members%20Guide%20%28V7%29%2005.2017.pdf
-Combined salary of £71,383 in year one, and then £77,698.60 until retirement at 68.
-Year one, 1/54th of the pensionable salary = £1,321.91.
-Accumulates +1.5% compound, for 32 years = £2,128.70 by retirement. I've not included the 'treasury order', as I have no idea what it realistically is, although the document gives it as 2%.
This adds up to a combined annual pension of £62,112.43. If I do use the treasury order example of 2% annually, it goes up to £87,909.94.
Before I open up a debate as to what to do with the money? Is this correct? This seems much higher than figures some others have given, although they all took 33k as my earnings - top of my band is closer to 41k, which I've assumed we'll stay on until retirement.
I think you'll find each year's earned pension increases by CPI+1.5%, so it beats inflation. Yes, it can add up to a very tidy pension*
*providing you get on and re-join it!!!......Gettin' There, Wherever There is......
I have a dodgy "i" key, so ignore spelling errors due to "i" issues, ...I blame Apple
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So I've had a look at some projected outgoings/income over the next 3 years and we can afford to be paying into the pension as of 2019, and save for a house deposit at the same time by 2020. We could have enough to get a mortgage by 2024.
The catch is that we'd be giving up the bigger house and the new car that we wanted - I'll have to work on convincing my wife to make do for another 6 years!0 -
Can you opt for paying 50% into pensions in the meantime? I know that the local government pension scheme allows this, but I'm not familiar with NHS rules.
It would be better than paying nothing for the next year or so.2022. 2% MF challenge. £730/30000 -
In the OP's defense, The one number we don't know is how much they are paying in childcare to enable both of them to work full time or close to it. It seems obvious that they should be able to pay pension contributions, save a deposit and still live well on2 good salaries, but if most of one salary is vanishing on childcare it all gets a lot tighter.
It is also worth considering that if they did both join the pension now and stick at it until 68 then they would both be on significantly MORE when they retired than they are now as they'll have DB plus SP and no NI to pay - not to mention kids being off their hands and mortgage hopefully paid off. The fact that they don't have much pension accumulated yet isn't necessarily an emergency - yet.
The big if in that though is the need for them both to keep working until 68. If they don't join the scheme soon then not only are they betting their whole future on the continued availability of these jobs with their excellent pension benefits, but they are condemning themselves to having to keep working at those jobs until they drop even if they grow to hate them or have health problems that make them a constant struggle. That is the reason why I would still say they would be mad not to join the scheme now. The house deposit can be saved once the childcare costs start to drop away and as their incomes increase.0 -
In the OP's defense, The one number we don't know is how much they are paying in childcare to enable both of them to work full time or close to it. It seems obvious that they should be able to pay pension contributions, save a deposit and still live well on2 good salaries, but if most of one salary is vanishing on childcare it all gets a lot tighter.
It is also worth considering that if they did both join the pension now and stick at it until 68 then they would both be on significantly MORE when they retired than they are now as they'll have DB plus SP and no NI to pay - not to mention kids being off their hands and mortgage hopefully paid off. The fact that they don't have much pension accumulated yet isn't necessarily an emergency - yet.
The big if in that though is the need for them both to keep working until 68. If they don't join the scheme soon then not only are they betting their whole future on the continued availability of these jobs with their excellent pension benefits, but they are condemning themselves to having to keep working at those jobs until they drop even if they grow to hate them or have health problems that make them a constant struggle. That is the reason why I would still say they would be mad not to join the scheme now. The house deposit can be saved once the childcare costs start to drop away and as their incomes increase.
Yeah, the pension is worth significantly more than I first assumed, so I do want to get back on it asap.
I picked 68 out the air to be honest. I didn't think that any earlier would be an option, but if we do manage to stay in the NHS it could be. It's hard to say whether we'd be there all that time.
Current plan is to get back on pension in April, then re-evaluate what we can put aside for a house deposit.0 -
Can you opt for paying 50% into pensions in the meantime? I know that the local government pension scheme allows this, but I'm not familiar with NHS rules.
It would be better than paying nothing for the next year or so.
Not an option as far as I can tell. My wife had the same issue when she was teaching - the pension was crippling but it was all or nothing.0
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