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  1. #1

    Some general pension/savings pointers please

    Hi everyone
    I would be grateful for some advice – some general pointers as to how to balance my finances more effectively, make best use of pension opportunities and where to go to get any professional advice you think I need. Here’s my situation:

    Me: 46 years old, Wife: 46 years old. Both in good health.

    No mortgage and no plans to move house or undertake any large building projects. No personal loans, credit card debts, car debts or any other borrowings. Run two fairly old cars that we typically replace every 5-7 years so it’s possible that one or both of those will need replacing in the next year or two but we would only spend 4-7k on a car. Two children heading to university in the next three years.

    My salary is c.80k, wife’s is 25k. Jobs seem as stable as any jobs are nowadays. We are currently saving c.2,000 per month.

  2. #2
    142k in savings (and growing by 2k per month), 32k of that in S&S ISAs (no longer adding to), the rest in cash accounts earning 1.4% - 3.0%. 58k in cash ISAs and the rest spread around in small pots with as much in my wife’s name as possible.

    Wife has public sector pensions projected to generate 15-20k p.a. on retirement. She also has a personal scheme currently valued at 50k and is adding 400 a month into via salary sacrifice (on top of the continuing LGPS contribution).

    I have company schemes currently valued at 165k and am paying in 11% of my salary (employer adding 6%) each year via salary sacrifice.

  3. #3
    Tax efficient savings are always attractive, but don't get carried away by that alone! If you are happy to tie up cash in the longer term in readiness for your old age, increasing your pension contributions makes a great deal of sense.

    Do you need advice? You seem to be managing extremely well and have a very sensible outlook, so it's tempting to say no - but a preliminary discussion with an independent financial adviser (for which you aren't normally required to pay) would be no bad idea. Do remember the discussion is to establish if it's worthwhile going into things in more depth/whether you get on in personal terms.

  4. #4
    Thanks Brynsam. I'll look into the preliminary IFA discussion.

  5. #5
    I don't know what outgoings you are likely to need in the coming years but....
    1. Way too much cash
    2. Why are you no longer contributing to the S&S ISA?
    3. Why are you not maximising your OH pension contributions via SS; gaining an additional 12% NI savings?
    4. Why aren't you maximising your pension contributions (tax savings)?
    5. Are you self employed; specifically a director of a/your own company?

  6. #6
    Do you positively enjoy paying 40% income tax? Why not contribute enough to a pension (by sal sac) to avoid it altogether? That 2k per month is far more than enough to achieve that. Look around the threads and you'll even find a stunt for paying the sal sac in unequal monthly amounts so that you save more than just 2% in NICs. Anyway your pension provision isn't particularly good for a high earner of 46 - upping your pension contribution is a good idea on those grounds alone.


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