DH to pay off mortgage then stop house bill contributions

Each person should check their own

www.gov.uk/check-state-pension

So I was in a position to pay off our mortgage before having our son which after having him gave us the financial freedom for me to stop my full time stessful role and retrain to do something more flexible, more enjoyable and less lucrative.

We've been together 15 years and we have always had our own accounts and joint accounts. We used to pay 50:50 for bills and day to day expenses but now we split them roughly 35:65.

There was a 6 month period while i retrained when i didn't work and only made small contributions to the joint account (from my savings).

This works for us. We've always made joint big decisions and we've always looked a the cash we both have when deciding how to fund family expenses. (For example DH is paying for the solar panels, i paid for the yr 6 residential for my son.)

I think it sounds completely fair for your dh to pay the mortgage off and then take a year off contributing to the family expenses. You wont be worse off.

But its okay to also discuss together what might happen in a years time to find a work life balance for you both and think about what retirement will look like for you both and when.

(My dh currently plans to fully retire at 62. I will be 60 then and plan to semi retire at the same time, dropping down to 2 days a week instead of my current 5 days).

In UK any person who is not working & under state pension age, can pay up to a maximum
Of £2880 into a SIPP & the Government will add free money up to £3600.
Recommend that he does this if he is not working.

Also put savings into tax free ISAs

there is a world of difference between a sahm with young kids and someone one with no other responsibilities

a sahm with school age kids I certainly would expect to be doing all the household stuff

Okay thank you for the maths so let’s assume £12,000 for 12 years
He needs to chip in £144,000 over that period, compounded interest aside yes you’re saving it but you’re not gaining it either so that’s neutral.
And that’s just to keep things on an even keel, without inflation and without a cost-of-living crisis

How much is the mortgage payoff? Divide that by £900 to see how many months he is banking. Otherwise he may as well invest his lump sum, keep the mortgage and keep paying it each month from his lump sum.

You can reduce your work when you are the same age as he is.

So when a woman is a stay at home parent they have to do it all do they? No sharing the jobs once the man is home from work, no parenting because the sahp has to do it all ? Or is it just because he's a man.

According to OP his pension will only be small and I’m assuming that’s because he’s taking the full lump sum to pay off the mortgage. So the point at which his small pension becomes a large one is in twelve years time when he reaches state pension age - assuming he has enough contributions for full entitlement. In the meantime OP has full responsibility for financial support until he either finds another job or reaches state pension age.

I think him taking a year off is fine, it sounds like he's feeling burned out.

As to the mortgage, it depends how much you have in savings for emergencies. It might be best to pay most of the mortgage off but keep some aside just in case e.g. the boiler goes or you have some other unexpected expense this year that you would struggle to pay on your earnings alone. If you already have a decent pot then paying off the mortgage fully seems sensible.

I do think, though, that if he isn't working he needs to take on the school runs (so what if he doesn't live them, who does?) as well as the majority of chores so that you both get to relax in the evening and at the weekend

So my understanding is that you pay £2000 into the joint account £1000 each
£900 of that is mortgage
So is this Mortgage that’s outstanding at least £12,000. I suspect it’s a lot more if the maths is correct.
In which case? How many years in theory is he paying in advance?
And at what point exactly does his small pension become a large pension that means he can chip towards the bills ?

What will happen when you retire and your earnings lesson and the bills still need to be paid???

Whether he’s worked longer than OP is irrelevant. He’s still twelve years off state pension age, and using the lump sum from his occupational pension to pay off the mortgage, which reduces his pension to pin money according to the OP. He also may well not have worked long enough to secure a full state pension in the event he’s unable to find another job in the meantime. If he’s relying solely on OP’s wage to be able to do this for himself, then he can’t afford it. It’s nothing to do with jealousy, and everything to do with being the sole wage earner with full responsibility for financing her family with no end date. It’s a terrible idea.

I'd view it as he's paid his 12 months upfront.

After the agreed 12 months I'd be revisiting the conversation.

Wow, why the personal attack?! She was only asking for opinions. Please get a grip.

OP has already said his pension is only small - he’s losing ten years of an occupational pension and if he doesn’t find another job there’s likely going to be a gap in his NI contributions meaning he won’t get full state pension. He wants to give up work, and has already said he wants to be a house husband so there is no guarantee that he will actually go back to work. He’s the one who is going to benefit most from the mortgage being paid off because he’ll be living the life of Riley while OP is saddled with the responsibility of all other household bills indefinitely. And they have children still at school. What about their expenses ? What about emergencies or unexpected expenditure, holidays ? What if OP becomes ill or loses her job? What good is paying off the mortgage if they can’t afford to live in the house without OP’s salary. It’s badly thought through.

But she said they pay £1000 each per month for bills and £900 of that was mortgage. So she’d be left paying £100 more per month, which he’d need to find.

Right. First off he has already worked quite a few more years than you, so he is allowed to take it a bit easy. However, he can't stop paying for his living expenses. Mortgage gone now the bills are still coming in at £1,100 so he has to contribute something.

Not always. A friend retired from one job at 51 because she couldn't get any greater benefit from continuing to pay into her pension - it would just have been throwing money away. Not all occupational pensions are the same!

OP from a financial POV your post is somewhat confusing. There are pension schemes that allow full benefits with pension taken at 55. There is 25% tax free lump sum.

Either DH plans to take a larger lump sum (incurring tax) to pay off a large mortgage balance leaving only a small pension or the remaining mortgage could be paid off with 25% lump sum leaving 75% pension as monthly income. The outstanding mortgage would have to be very small to allow it to be paid off with a 25% lump sum that left a less than £100 a month pension.

This is a decision that affects the whole family and your future retirement income and should be joint with financial advice.

Depending on the sums involved your DH may be planning to pay 20% - 40% tax to pay off a debt (if the amount exceeds 25% tax free lump sum) incurring less than 5% interest.

You may not be planning to divorce but this is still a marital asset and very much your concern regardless of how finances are organised.

Also, when you're looking at your finances, sounds as if his current role might come with life insurance, so that will be an additional cost, also, he'll be at home more so bills will go up, another additional cost, and will his overall pension be smaller in the long run as he's taking it early? Another additional cost.

DH might find he needs a little part-time job.

If his (hypothetical) £40k (or whatever) contribution knocks £1000 a month off the mortgage repayments , yes.
But initially you said £40k "earns" him 40 month's grace - which is not right.

She's jealous that she still has to work for a few more years while he doesn't and gets to enjoy spending time on his hobbies, but she forgets that he is older than her so had worked longer than her anyway.

She is also upset that he has a pension that allows him to take a lump sum while she doesn't avs a similar person nest. I have no idea how that's her DH's fault.

These are her issues that she needs to work through.

I can see your point of view: What am I getting out of this?

It's a fair enough point of view. Ask him. Say you need to feel as if you'll also benefit. Obviously, word it nicer than I just have.

And burnout…

(And future insurance payments will go up to reflect the fact that you’ve claimed.)