Saving for pension as SAHM

[BrightBrightEyes]

I'm after some advise - or possibly advise on who I should ask for advise??

Basically DH and I have just received an inheritance which pays off our mortgage, freeing up money every month that we would like to use towards pensions.

DH is employee, he already pays into his work place pension - he pays 6% and so does his employer. He can increase his payment (but they won't increase there's).

I'm a SAHM, I have a teeny tiny pension fund from previous employer but it's like 5k or something. Maybe less.

Any idea on the best way to approach this? We've got around £500 per month to spend. Should I think about taking out a LISA? Should I contact the company that holds my previous pension and restarts payments? Or should DH just pay it all into his pension? Or any other ideas...

Why not set up your own SIPP pension .... you can pay in £3800 a year even though you are not earning
and then put the rest into an ISA

you need your own tax allowance worth of savings in the long run

Yes I can do that, basically I want to know what makes the most sense overall. Would it be worth speaking to some sort of financial advisor do you think?

Definitely talk to an IFA
as they will take a holistic look at your whole family finances

Any recommendations for how I would go about finding one - is it just a case of googling?

Mine is a former fellow school mum.
Do not google. Ask around. Personal recommendation is always the way.

A LISA makes sense for you as you get the government contribution even though you're not paying tax, so that's a 20% bonus right there. Not many investments will give you that off the bat (none will). You can invest £4000 a year I think, so you are going to have some extra to find a home for. The thing to think about is which to invest in, check the fees. I have one with nutmeg, seems fine in the sense that everything is doing badly at the moment! But, talking to an independent advisor is a good move. You can search for them online.

Appreciate your advice :)

LISAs work best for young people saving for a home and are capped at £4000 a year and cannot be added to after 50

as the OP is already mortgage free, I wonder whether a SIPP would not be a much better bet

ask around and find an IFA you like

Definitely max out each of your isas and everything you can contribute through the government scheme, after that consider junior isas for children (university isn't getting any cheaper). A good financial advisor will have additional ideas I suspect based on your risk attitude.

LISA’s are not as useful as a personal pensions not least less choice and higher charges.

A pension in your name is good plus anything that might save your husband 40% tax

Ta1kinPeace

Why would a SIPP be better than a LISA? If the OP is under 40 they she can pay in until 50 then draw on it after 60. The LISA gets a 20% bonus added by the government. Does a pension contribution? I guess so to compensate for the tax paid? But I don't know so asking!

The difference I know of is that the LISA funds will be tax free when paid out, now maybe the OP won't be over the threshold if she continues not to work or contribute to other investments but if she is then there will be tax to pay on pension payouts. I think the downside is that pension would not be included on calculations for any benefits in the future, but a LISA would.

The government website (money matters?) is quite helpful at explaining the basics.

CAnny
Yes, SIPP pension contributions are grossed up.
Yes the LISA is grossed up - but maxed at £1000 and its time limited
normal ISA is better

as the OP is mortgage free and her DH can afford for her not to work, they are better using and IFA who can plan across the board for them

FWIW I'm 33 and DH pays 20% tax - just.

BrightBright
Ah, OK, that changes things ....

I'm still not wild about a LISA because it locks you in for so long
on the other hand a SIPP locks you in for even longer

Possibly do the bit of SIPP you can without earning
and then normal ISA the rest
BUT
talk to an IFA

on the othehand a SIPP locks you in for even longer

No it doesn't. You can access a SIPP from 58 (or it will be when the OP gets there). You are far better off with a pension LISA products are basically crap as there hasn't been any uptake.

Well thanks both of you. I will definitely talk to an IFA.

I know this is a little late but you can put £2,880 (which is grossed up to £3,600) into a personal pension. You can also invest in a LISA - I agree the cash versions are rubbish but other than that they are the same as other stocks and shares ISAs except that you pay a penalty if you access it before 60 (as you already own a house). It depends upon your attitude to risk and access to the money... if you want to keep it back for retirement then I think LISA can be a good thing - you may as well open one before 40 anyway to give you the option of investing open. I have one as an addition to rather than instead of a pension - I max out my pension first.
Also, when you turn 60 the money will be tax free whereas 75% of your pension may be subject to tax.
You can put up to £4,000 into a LISA which is then topped up to £5,000 plus a further £16,000 into cash and/or stocks and shares ISAs.