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Original poster

Please help me sort this out...btl or pension

11 replies

Upupandiwent · 04/03/2019 11:44

Hello, I have 60k from an inheritance that I need to invest. I'm 51, single very work part time as a teacher but have very littke jn the way of pensions. I gave a btl property that I receive 500 pm. I'm worried about old age as I only joined the pension scheme 10 years ago and won't have a big pension.
I can take out a loan of 30k to help buy another property to rent out (housing is quite cheap here and a demand for rentals). I'd pay off the loan quickly as I only have small overheads and no mortgage on the house i live in and use the money from rent to help pay it off?
Or should I try to pay money into my pension? Or pay extra each month into the teacher pension?
I'm just very confused and worried about doing the wrong thing and being skint in old age.

OP posts:
WinterHeatWave · 04/03/2019 11:57

Personally, I'd put it into a pension, (or stocks and shares ISA). You already have 2 properties. Adding a third is really laying your self open to disaster should house prices crash, or the letting market change.
But that is my personal opinion, and not based on any form of financial training.

Original poster
Upupandiwent · 04/03/2019 12:01

Im just wonderjng if it's too late to put money into my pension? Will I get the returns? I can't teach until I'm 67.

OP posts:
DustyDoorframes · 04/03/2019 12:02

Your first step is to find out your options re adding to your pension- you are most likely in a brilliant pension scheme as a teacher! But you may have limited options re adding extra, as it's already very good.
I agree that if not, a personal pension may be the way to go. Seeing an IFA may be wise.

DustyDoorframes · 04/03/2019 12:06

You needn't take it out of the pension the second you hit 55 though- especially as you have the BTL income. Remember that if you put it in a pension (and you may not be able to put it all in at once due to annual limits) you get an extra 20% added on which is hard to beat!
It might be a case of putting the max for this year into a pension, and a chunk into an ISA. It's worth getting advice ASAP as the year end is upon us, and splitting it across two years might be handy.

gassylady · 04/03/2019 12:08

Why not have an initial consultation with a certified financial planner? They are different to advisors in that they look at your current position and your goals and how to get you there. So if you’re sure that you won’t be teaching at 67 what income will you need until then etc. Not just about selling you policies or products

Laska2Meryls · 04/03/2019 12:12

before yu look at private pension, look at Additional voluntary contributions AVCs on your teachers pension or buying added years which you can with a lump sum .. .. the teachers pension is one of the best there is..you'd be unlikely to get such a good deal on a private pnsion

Also if you do AVCs you can put up to half of your salary in , and get a tax exemption.. if you did that and used the rest from you inheritance to live on but making up the difference monthly you'd actually be saving a lot of ax.. .
Get some advice from your teachers scheme manager though. I started AVCs (local govt pension) at age 50 and saved almost 60 k in 10 years that way .

. I have now taken flexible early retirement and its added a lot to my pension (i could have had almost a 3rd of it back as a lump sum if i had wanted, but didnt )

Laska2Meryls · 04/03/2019 12:13

also yes , you can take the pension early !!

Original poster
Upupandiwent · 04/03/2019 13:54

Thank you everyone for your replies. I'll find out my options from a financial planner as suggested by gassylady.
The reason I'm tempted by the bit is that the area I live in is increasing in value all the time and there is a demand for rental properties. I could use the extra income from the two btl properties to top up my pension every month, or put it into some savings account. I don't intend dipping into that money, it's to save for my old age. Does this seem like a good idea? Hopefully when I need more money I could sell one of the properties?

OP posts:
Charlieiscool · 04/03/2019 15:54

My DH put extra into the teachers pension and it really hasn’t been worth it. Invest in property. Even if prices drop for a while there is the rental income and ultimately a capital gain.

Charlieiscool · 04/03/2019 15:56

Your financial advisor may not be impartial. I have always regretted taking advice from the suits and ended up worse off. Property investments have been terrific though.

Original poster
Upupandiwent · 04/03/2019 17:19

Thank you for replying Charlie. Those were my thoughts too. When I looked into how much I would gave to put into a pension compared to what I'd get back then it didn't seem worth it. Especially at age 51. Unless I'm missing something of course

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