DH to pay off mortgage then stop house bill contributions

[Luannaa]

DH will take early retirement at the end of the year from a job he has worked very very hard in and made a huge difference to people’s lives and it has also taken its toll on him with things he has had to witness- hence earlier retirement.

This will give him enough money to pay off our joint mortgage which he wants to do so we can be mortgage free. I am extremely grateful for this as it’s huge security for the future and our dc.

However DH then doesn’t want to go into any work for at least a year, for his hobbies his small pension will see him through but this means he cannot pay anything towards the weekly/ monthly bills.

As it stands we combine £1k per month for all joint and household bills, one of these being the £900 mortgage.
With that gone, technically he doesn’t need to contribute any more as he has paid his bit but I feel a bit miffed to carry on working 40+ hours a week and sometimes overtime while he has no job, no bills to pay and just enjoys his hobbies (they are free/ low cost).

AIBU?

Please share your opinions and be honest as I want to get this right for us both.

There is a risk of not finding another job but it sounds as though with his type of career he could find something.
But you are right that this could be a worry.

However, with a mortgage paid off I would be less concerned about potentially losing 10 years worth of pensions.

With the mortgage paid off it’s possible that OP could also retire at the same age as him as they’ll only have the other bills to cover.

It would be different if it meant OP needing to contribute more but as long as he can cover his half, then it’s worth the risk.

I think a year off in exchange for paying off the mortgage isn’t a bad deal. However if he’s a househusband then he needs to take over those duties.

1. No lie ins because he’ll be up sorting the children & taking them to school.
2. Taking children out of wraparound care will free up the money to cover the shortfall.
3. He takes over shopping & laundry etc

So he’ll still have a change of pace & your life will be less stressful than previously. You might want to keep after school care one day a week, so he has one day where he’s not having to fetch the DC at 3pm.

i disagree. If they pay £1000 each per month on bills and he is planning on putting in £40k straight (or whatever, I was low balling!) how is it different? She won’t need to pay the mortgage bill at all. But he needs to make up the £100 shortfall, which shouldn’t be too hard with a pension.

I'd like to know how much his pension is each month.

Because the risk is he doesn't find a job or earn very much in the future, so how would that impact on the family?

It's very hard for the over-55s to get work if they want to have a 'career' again unless they are highly skilled and in a profession where there is a shortage, although they are still in demand in other unskilled jobs . Or can create an income through being self employed.

Living on OP's income may become long term which is not a good situation.

OP said the £100 could be avoided by cutting back on things like take aways.

Presumably if he is taking early retirement he is getting a monthly payment alongside the lump sum. So surely he can pay for some stuff like food etc. tbh been married 30 years and I don’t understand the this is my money this is ours I pay this you pay that thing. We have joint money so woukd look at joint income after he finished and do a joint budget. Surely with no mortgage, and his pension income you could consider cutting back on your hours and you can spend more time together. Worth checking what other bills can be reduced such as if he has a big fancy car for work that can go for a cheaper small runaround or even a bike to keep him fit after retirement. This is the time to sit down together and work out a new budget going forward.

My husband did this for two years and it was ok but I did have moments of wanting to go and scream into the woods

because, (maybe this is the same for you), whilst DH had a very demanding amazing job that people respected him for, during his break down I had to give so so much emotional support, so it is hard for the partner too. To then have to shift to stepping it up at work and find that energy whilst he recovers and relaxes was not always easy

some days I would come home from work and have to immediately start cleaning and cooking whilst he was happily pootling and it was HARD and I def got angry a few times, and he did shift into helping out a bit more, but goodness me I was relieved when he got a job again after 2 years 😬😬😬

However, with a mortgage paid off I would be less concerned about potentially losing 10 years worth of pensions.

I wouldn't. Especially if he is also taking money OUT of his pension fund to do it.

He was always going to retire before you with the age gap. How much did he pay off the mortgage? How many years does the mortgage payment cover his £1k contribution? Sometimes people need a break, sounds like he needs it. I think you need to work out why you feel so jealous over this situation. It's not that he has not contributed. It's not unexpected that you would need to work when he's retired. But long term when you are both retired you need a plan for how you cover living expenses.

Ideally you want both though.

Mortgage paid off great. Year out job hunting while he decompresses from stressful job, fine. But it’s optimal that he works for another 10 years and retires at 65 in a good position.

Agreed. So OP is expected to give up little luxuries like takeaways and will have to tighten her belt at the supermarket to facilitate this? And she’ll continue to do the school runs despite DH being a SAHP whilst she works FT? Sounds like a recipe for resentment.

Retiring before OP and retiring early are 2 different things.

If he were 65 and was drawing a full private pension as well as state - no doubt OP would feel differently.

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

And burnout…

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.

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.

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.

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.

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.

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!

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.

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.

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.

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

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

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