getoutearly
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Not net of tax.Conscious there are available deposit rates with higher interest than my mortgage
Before you think of any other investments, what's your pension actually invested in? Is it 100% global equities, or is there a bond component?Me: 600K in pension fund
I didnt consider the tax element. Good pointNot net of tax.
Before you think of any other investments, what's your pension actually invested in? Is it 100% global equities, or is there a bond component?
Thanks. I've reviewed those alright but wasnt sure if deposits was the way to go but take your point its relative to the timeline. If I could retire in 10 years I'd be happy.Worth reviewing this - although if your timeframe is longer than just a few years you might want to look at something higher risk/volatility/reward than deposits for some of your money.
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Sorry, another question. Roughly what's your saving rate per month?In general are you: Saving
I'm not sure that this is necessary or desirable.Should get a professional wealth manager to manage excess cash (e.g Fisher)
I'm saving around 2K per month, should be able to live on roughly 50-60k in todays money if I give up workSorry, another question. Roughly what's your saving rate per month?
If you paid off mortgage fully, what would it be?
Or to turn the question on its head, have you ever thought about how much you'll need per year to live on if you give up work?
For the last couple of years I've did a one up top up to 25% but agree it makes sense to do this as a formal arrangement. Agree regarding my Spouse, I've asked them to raise this with their union and pension admins to see what the art of the possible is hereYou can get tax relief on up to 25% of your gross so maybe look into increasing your current 20%? (I'm assuming that the employer 8% is ignored for the purposes of tax relief).
Your spouse might want to clarify their likely PS pension benefits and what might be possible to increase this - e.g. buying back service if applicable, increased AVCs. There are some excellent threads here about public service pension issues that might be worth checking out.
Thanks good adviser here, my pension is in my employers company scheme so don't have have control of the fee's etc. Advice above looks sound however - thanks for thatHere’s what I would do in your shoes (you’re doing great BTW):
1. Pay off your mortgage first thing tomorrow and cancel your mortgage protection policy.
2. Increase your pension contributions to 25% of €115k.
3. Check what fees you are paying on your pension and move if necessary. Stick with an allocation of 100% to a global equity tracker.
4. When the proceeds of the rental sale land, stick with cash but become a “rate tart” - hunt down the best interest rates available.
5. Investigate whether there is any scope for your spouse to purchase notional service.
Hope that helps,
Thanks Frama1, good to hear from someone in a similar position.I have done similar to what you are wanting to do and would agree with Sarencos steps - along with having a clear forward view of your spending - both day to day and capital - e.g. What major house repairs, car replacements, kids college? will you need in the future as well as the 60k living expenses.
Also do you want to stay in your current home - that is a good chunk of your wealth which if you want to stay in, doesn't really count towards your retirement pot, but if you want to downsize can count.
You indicate that you'd like to cut back in 5-10 years. You have a good base (pension well built up and added to every year, good house mortgage free) and you will significantly grow wealth over coming years if you stick at 185k combined earnings. Just simply by maximising the pensions and regularly investing in a balanced portfolio to give you dollar cost averaging.
Personally i found that now I've sorted the work-life balance and got to 2/3 days a week my desire to retire completely has disappeared - I can do all the things I wanted to do, have much more time with the kids and am making the most of a really important stage of life. Cutting down in your early 50s and working part time after that is an attainable goal for you.
Be careful of silo thinking and treating different pots of money as somehow separate. You need to consider and manage your overall net worth holistically. Silo thinking often leads to mistakes in getting the best results. E.g. I can't touch my emergency/child education fund even though I have a car loan at 10%. (Not the case here, but hopefully you get the idea).I needs to take kids education into account for sure but we are putting away the children allowance into a separate fund (which I forgot to mention above) to help with this.
Your earnings are more than 115k, so tax relief is capped at 25% of 115k (I assumed you are contributing 20% of 145k, which is almost identical).For the last couple of years I've did a one up top up to 25%
This is not the complete picture; you have the option of putting your AVCs into an AVC PRSA for example. Only your mandatory contributions must go into the occupational pension scheme. You should understand your pension fees, and investment options, and compare to other options for the AVCs. You may well find that what you have is the best you'll get, but you should confirm.my pension is in my employers company scheme so don't have have control of the fee's etc.
Your earnings are more than 115k, so tax relief is capped at 25% of 115k (I assumed you are contributing 20% of 145k, which is almost identical).
This is not the complete picture; you have the option of putting your AVCs into an AVC PRSA for example. Only your mandatory contributions must go into the occupational pension scheme. You should understand your pension fees, and investment options, and compare to other options for the AVCs. You may well find that what you have is the best you'll get, but you should confirm.
Good point - missed that!Your earnings are more than 115k, so tax relief is capped at 25% of 115k (I assumed you are contributing 20% of 145k, which is almost identical).
Ditto - good point.This is not the complete picture; you have the option of putting your AVCs into an AVC PRSA for example. Only your mandatory contributions must go into the occupational pension scheme. You should understand your pension fees, and investment options, and compare to other options for the AVCs. You may well find that what you have is the best you'll get, but you should confirm.
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