Early-retirement wannabe

Angry_kittens wrote: »

Stocks have generally always terrified me as my father got burnt by the 2009 crash just as he commenced his pension, but I am now more comfortable with the risks and have changed the portfolio blend on my work Pension - bigger risk while I am young.

Glad you now understand the risks. Single company risk is the one I've seen burn the most people, with single sector/company next down. Of course, panic selling at the bottom and not holding enough cash/bonds can also cause a few sleepless nights!

atush wrote: »

Well short termism isnt always wise either. a good LTV is important, but giving up employers contribs and not taking advantage of 32% TR is a bad idea to me.

But extra money/income could be split and they could do both.

Granted - but a better LTV would give a better rate and excess could go to pension (though I appreciate that would have more of an impact if the range of mortgage rates was a higher than 1.49 to 2.49%!).

Angry_kittens wrote: »

I am aware of the tax relief on pensions; I will be taking full advantage of that ASAP! My employer contributions are not linked to my own - they contribute 8% irrespective of what I put in.

I know mortgage over payments are not financially sensible, the sort house I am looking at is right on the limit of the equity I have now and the amount I could potentially borrow (~4.5 x salary) - as I'm single this is my major hangup atm.

I do have a IFISA on one of the P2P sites, although I don't earn enough interest outside of that to pay tax on currently.

Although ever a saver I do have a few frivolous outgoings - a brand new car (on 0% finance of course) and a penchant for PC gaming - top end hardware is very expensive!

I may retire earlier than 55 / pension age - should finances allow at the time, god forbid I'm still at the same company they seem to like giving people a golden boot at that age so it may all work out!

Thank you all for the comments!

You seem like you've got your head screwed on so don't really have too much to add to what others have said other than good luck. I'm sure with your attitude things will work out fine for you.

The only piece of advice I'd have would be to maybe think about contributing more into a S&S ISA rather than a pension.
There's a few reason's I'd advise this but they all revolve around flexibility. In your mid 20's there's potentially a very long time to go until you're able to access your pension savings. As you've mentioned this can be altered on a political whim which even though i'm 10 years older than you concerns me. Obviously this is less efficient tax wise than the pension however you do have opportunity to move your ISA savings into your pension as you near retirement and the policies around pensions more certain for your retirement window.
As far as investments go those within the ISA can be selected match those within your pension if you desire. I'd argue that there's a greater flexibility within ISA's than pension fund. Certainly my S&S ISA has more than my company pension!

Lastly by investing into a S&S ISA you are able to introduce much greater flexibility on the timing of your retirement. As others have commented on this thread there could be opportunity to use your investments to fund a staged retirement, perhaps a move to part time working or even the setting up of a lifestyle business. You could do this much much sooner than whatever the minimum access to pensions age is at the time if you keep the investments accessible, which of course they are not within a pension.

I've mentioned on other threads that I don't like to think of access to pensions age as a "retirement" age like most people do. You can retire any time you like providing your finances allow. Keeping more accessible especially whilst you're relatively young is a wise move to me especially if you have aspirations to retire early.

Good Luck! :money:

kidmugsy wrote: »

I wonder sometimes whether brand new cars are more ruinous than cocaine.

I think for most people cars are the single biggest waste of money through their lives.

It took me several mistakes to learn that lesson! :money:

Terron wrote: »

It is one I am planning to make next year

Why? Why on earth?