£100K - difference of opinion on how it should be spent.

[Wrinkledretainer]

Name changed. We’ve inherited (dh parent) just over a £100k. Both late 50’s with good defined benefit pensions of many years and good max lump sums if we want to take it of £200k or minimum of £50k tax free if we want to keep max monthly pension. Annual pensions will be £85K with state pension included. One child at uni whom we have saved £40k for towards flat deposit. Fees via student loan but we pay maintenance/halls/rent cost.

Dh earns a third more than I do, combined income £95k. Debts £20k as we needed some house works. Mortgage still £170k as we lost a business and had to sell up so didn’t re-enter the property market again in SE until 6 years ago. House worth £450k.

Over the years we’ve travelled extensively around the world and spent a lot on holidays. I’d like to pay off the debts, put a patio in (5K), buy a £10-12k car as ours is on its last legs and then put the rest towards the mortgage. Dh wants to pay off the debts, put a patio in, get the car then spend the rest travelling more whilst we can.

In my scenario, paying off the debts and paying down the mortgage will mean we can save an extra £1200 a month. With his scenario, it would be an extra £600 a month. We only have savings of £15k taking out dc savings of £40k above.

I think the longer term plan is to move to the South coast but houses there will probably be about the same as where we are price wise.

Dh thinks we should live a little now as we’re getting older and health wise things are creeping up. He envisages we’ll slow down in our 70’s and the pension savings will accrue then. I feel we need to be more sensible now to build more of a cushion. If there is another inheritance, it’s only likely to be about £20k.

What would you do?

I think what dh wants for 2 or 3 reasons.

1. It was his parent who died.
2. you both have great pensions so are doing well already. You will also be paying off your debt so that must help reduce outgoings? You could maybe use that monthly savings to overpay your mortgage each month
3. Your dh is right that by the time you retire you might not be in good health. You can think you’re invincible and overnight something happens which affects your health and rules out travel plans.

I agree with your husband. You have great pensions, but anything could happen, enjoy yourself while you can. It’s not like if you don’t pay your mortgage down you’ll struggle

We're older, and have only one surviving parent left, from whom we do not expect anything. We are well now but nearing 70, and DH has a condition that requires taking amiodarone, which makes him acutely sensitive to UV, so sunshine holidays are not on the cards.

In your shoes, I think I'd probably enjoy a portion of the money now, while you are both well enough to relish it. Have fun! You hopefully have many years to enjoy repeats on TV. But settle the mortgage first.

Sorry I misread your OP.

Given your ages I’d definitely do mortgage.

It’s still very high. FWIW, my DB pension based on a revalued salary of £52K was £15K with a £45K lump sum and that was taking it 2 years early.

It’s DH’s parent so he decides - when I inherited some money from my parent I discussed what to do with it with my she but would have been seriously pissed off if he thought his wishes trumped mine.

Debts and mortgage!

Had the same convos with my DH. I’m more cautious than him and would want to put money aside for retirement. He says what if we’re not in good health to use it to best effect when retired. I think there’s a balance of somewhere in the middle.

Ah, that’s a very different picture then. I assumed that was what your pension was worth now, not in 10 years time.

Debts and mortgage. The only sensible option and it sucks like shit, but it's the best way. Holidays are a nice to have, as are patios and cars. You need the mortgage and the debt to fuck off. Be sensible. 85ks a nice sum at the end of the day.

Are there penalties to take your pension early? Can you pay 100k into pension now and retire a few years earlier, perhaps on a bit less (but 85k is massive).

Personally I would do debts and mortgage.

But really it's his inheritance not yours.

A colleague of mine died, many years ago, very soon after retirement. Your husband has a point about enjoying life while you can.

Maybe combine both ideas to varying extents

@Wrinkledretainerin addition to what other posters have advised, check if there are any early repayment fees on your debt/mortgage.

The younger me would have gone down your route.

The older me, with a husband with unexpected arthritis and PMR which curtails a lot of the plans we had, says "sod it, enjoy it while you can".

Im in the sod it camp, travel enjoy life and buy a porsche.

Travel while you can. Not only does insurance become much more expensive - and almost impossible if you are on a waiting list - but you may struggle to get car hire, even if you feel fit enough to drive.

Pay off the debt and you can use the amount you save to pay down the mortgage faster, You can always downsize, you may not be able to make new memories.

Pay off some debts and then go have some fun, travel, laugh live. Life is too short and best to do it when we can still enjoy it.

Name changed. We’ve inherited (dh parent) just over a £100k.

You mean your DH has inherited just over a £100k.

Can you not meet in the middle. I am inclined to agree with your dh as we’ve had a bad few years of sudden unexpected deaths all below retirement age including dh brother age 60 ex military had a heart attack the day his first military pension payment went in. Life is for living and you already have good pensions etc

I’d go with what your husband wants as it’s his inheritance.

That’s the one situation where I think it shouldn’t be treated as family money for the purposes of decision-making.

You have fantastic pensions, so don’t know why you’d be worried about paying that in retirement, and if something happened to one of you before the mortgage was paid off you could always downsize at that point if you couldn’t afford it.

Annual pensions will be £85K with state pension included.

How do you have such good pension?!

The £85K figure includes both defined benefit pensions taken at 67 (both started early in the final salary schemes which switched to career average). Plus a full state pension each on top.

It's so depressing that they closed this scheme whilst I was at uni 😢

Pay off your debt and mortgage. You’re late 50’s. Some people aren’t as fit and healthy in late 60’s.
you can travel with the money you’re saving.
you’ll be less stressed and that’s huge.

And that's £35k they agree on our of £100k.

But it's his parent who passed, that person probably would have wanted him to decide what to spend their money on.