AIbu to wonder how I’ll cope when I retire?

[HurricaneZeldaAndToto]

Oh wise Mumsnet, I really need your help as I’m getting increasingly worried about the future and how we’ll support ourselves when we retire.

I’m 48. I currently work part-time and my income is 60k pa. DH earns the same and pays 50% of all bills etc. We have a mortgage with 20 years left to run at £1.5k per month. This will increase to £2k when our deal ends next year.

Neither of us have any savings, we used them all to buy our house 7 years ago and for various repairs since.

I only have £6k in a pension pot, as I’ve worked for myself most of my adult life. DH had
has only £4k.

Foolish, I feel like we’ve left it too late to properly plan for retirement and we have no idea what we should be doing!!

DH and I have only approx £60k inheritance in the (hopefully long distance) future.

What should we do? Neither of us have the kind of families who could help out with advice and this is not something I’d feel comfortable speaking to my friends about, as they will all inherit enough to never have to worry.

AIBU to think I’ve left it too late?

Where do we start?

The way to look at it is that anything you can save into your pension is going to be a plus. You should also end up with a mortgage free home.

Can you go full time?

Your combined salary is 120k a year. You currently looking at paying 24k mortgage per year which leaves you with plenty of money to spare. Why not pay more? Why not increase your pension pot with the remaining money?
20 years is plenty to pay off your mortgage, build a savings pot and increase your pension contribution. Not to mention that you can downsize.

Well, work full time, downsize the house, and pile £ into a pension.

Is money in the pension pot the only option?

I have no idea how much I should be putting in or for how long. What will that look like when we retire?

I can’t go full-time, there is not the work to make it happen.

Pay as much as you can into a pension as soon as you can. You'll be working for the next 20 years or so while you pay the mortgage off so definitely not too late. But pensions only work well if they have time to grow, so don't wait. Read up on Money saving expert about the best pensions. It's far better from a tax perspective than just putting in a savings account.

@anythinginapinch we can’t really downsize, we’re SE so that’s a tiny mortgage for the area. Also we need all the bedrooms and office, so couldn’t really go smaller.

I also can’t work full-time. My comment base is extremely limited and I’ve just about maxed them out.

I know that sounds like excuses, but it’s really not.

When you retire you will only need one bedroom, that's when you downsize

@SmallestInTheClass thank you, I’ll look on Moneysavings expert.

Speak to a pension adviser, CAB… You earn good salary and run your own business, it seems you have capacity to gather information about your financial options.

Not sure why you can’t work more - if you’re convinced about money there are always other jobs out there also part time to fit in with what you’re doing.
I do sympathise though, 40s should be when you can relax a bit and have a fun time, but if you have so little savings you do have to prioritise that, otherwise your retirement will be a little bleak.
Can you overpay on the mortgage?

@Greensleevevssnotnose that is a very good point! Downsizing to a 2 bed would generate about £250k is that enough in a pension pot when you retire? As it won’t have had any time to grow.

Concerned not convinced.

£60k for part time hours and £750 mortgage per person and you don’t have any savings or pension?!! What on earth are you spending all your money on?? I earn slightly less working full time, pay £700 on my mortgage and bills are only paid by one person so proportionally higher than splitting between two and I easily pay extra into my pension and savings every month! Have you got 16 children or something that you failed to mention??

Also, what does your husband do that means he’s got such a small pension? Has he had long periods out of work?

Also, don’t bank on the inheritance - care home fees can eat away at this. A close friend kind of relaxed about future planning as she had a rich grandma, but that grandma lived to 101 and spent the last 20 years in an expensive care home, and there was very little money left by the end.

@NotFastButFurious We spent our late 20s/30s saving a deposit to buy. We had no family help. We have then spent the last 7 years doing up the house, as it needed lots of work. So we’ve lived pretty much in our overdrafts since then. We just finished the last final big job, so now we actually have the space and time to think about what comes next.

Now I’m flapping as I’m hoping we haven’t left it too late to properly support ourselves during retirement.

I still have no idea what you’ve been spending all your money on other than you bought property that’s beyond your means??

@Ozgirl75 DH is self-employed too. So we focused on saving for a house and not retirement.

Inheritance is guaranteed, as from a relative / property not in the UK who already has a younger relative caring for them. Worth pointing out this a much smaller share of estate to make it up to the relative who is doing the caring.

Is this a joke? I’m your age and work PT. I earn less than a third of your annual earnings and Im managing to save for my pension, and pay towards a similar SE mortgage.

I think don’t panic. I’d overpay a bit on the mortgage and start a pension now. It won’t end up huge hut it’s better than nothing. Then come retirement you can downsize if you need to

Well you’ve nearly 2 decades before you retire so I’d advise you start saving into a pension and stop spending it.

Maybe overpay the mortgage when you are on such good salaries.
Look at downsizing closer to retirement age.
Keep working past state retirement age.
Start paying into a pension now.
Don't bank on inheritance - it is never guaranteed.
You are in a lot better position than many.

It must be. The maths is not mathing in my head either as it sounds like the OP spent close to 100k a year for the last 7 years to refurbish a property when they could buy a whole other property for that money or at least pay off their mortgage.
And here I am earning just over 40k with paid off mortgage, savings and a pension pot…

Do you and your DH save money each month? If you can both save some money every month, that will be a big help as it will build up over time into a good-size pot.

If you saved (for example) £300 each per month for the next 20 years - or invested it, if you’re comfortable with investing - that would give at least £70k each. I know it’s painful at the moment that interest and mortgage rates are so horribly high, but the benefit of that - at least - is that you can find a high-interest account to save into.

Also, you mention you can’t work full-time as there’s not enough work available. Could you get another part time job to boost your earnings a bit further so you can save more? Although I have to say - a £60k salary is bloody good money!