Am I saving too much?

[Pensionpot123]

Hi all,
I'm always a bit concerned that I don't splash out - I am very frugal....am I too frugal?

Household income ~£100k in West Scotland. Wife and I are mid 30's.
One DC - 6 months.
Value of house - £600k, mortgage £200k with £50k savings. Plan to pay mortgage off in 10 years.

At the moment our pension is looking to be approx £76k/yr combined exc. state pension.
Long term plan would be to downsize on retirement to house maximum half the value of current home (if nothing changes, profit £300k from sale).

Should I be spending more? Am I leaving myself too much for later life?

At the moment we -
Don't eat out
Go on 2 good holidays a year (Florida, cruise, New York etc)
Don't do hotel breaks
Get a takeaway every ~3 months
Change car every 2-3 years to a new-ish budget car (Ibiza, Fabia, Clio etc)
Keep all other outgoings to a real minimum

Any opinions or serious advice about pension is welcome!
Realise there may be people who earn a huge amount more or have a much bigger pension pot.

Jesus

Where is that £76k coming from? Is that the assumption that you carry on working in current jobs till retirement and the scheme doesn’t change? Of course that’s unlikely to be the case.

As a general comment you seem to have life planned out at a very early stage, what do you want to do with life whilst you are still young?

Relax and enjoy life u could drop dead tomorrow

Are you happy ?

We're both teachers so although it's likely to change, it shouldn't change massively. 👌
I just don't want to get to the age of 60 or 70 and have too much!
Life changes...of course it does but not bad to have an idea of where you'd plan for it to go. We go on great holidays and see everyone else around us in similar jobs driving their big range rovers, going away on overnight breaks once a month, out for £200 dinners and don't do any of that.

Are they daft spending every penny (and maybe more?) they have...or are we daft for putting too much in the future pot and not enough in the present pot.

76k a year is a massive pension. We both earn six figures and won’t have that much. I’m assuming you have public sector pensions?

Well you're wasting your money by changing your cars every 2-3 years.

Anyway, you shouldn't be asking randoms on the internet whether or not you are being too tight-fisted, you should be discussing it with your wife.

How do you have 400k equity, 50k of savings from a few yrs of 100k salaries?!

We're definitely happy 👌...just intrigued.
I'd say we spend -
Essentials plus savings - 40%
Holidays - 5%
Cars - 2%
Hobbies - 2%
Direct debits (phones, broadband etc) - 1%

Of our income with probably the rest on tax/NI/pension

Plus teachers pensions require quite a hefty contribution

It is public sector pension... I believe it works out approx 35%ish (9+25%)

How do you only spend 5k on 2 ‘good’ holidays when you’re tied to school holidays?

In terms of equity, it's came from a huge amount of sacrifice. Put in approx £35k a year, made approx £60k on first home in a couple of years and have made approx £100k on this home value already.

I am a TA and I have 2 good holidays a year. One is in a friends house, the other in a lodge type accommodation.

How do you only spend 5k on 2 ‘good’ holidays when you’re tied to school holidays?

Also interested in how to get Florida etc so cheap during school holidays!

We're both teachers

If you’re mid 30’s then you both must be in management positions to be on £100k joint income in the West of Scotland. If you’re in a £600k house on those salaries you must have had either a large inheritance or a windfall to afford a house that price on a teachers salary. You also have a huge pension pot already being mid 30s so something isn’t adding up here being on teachers salaries.

I don’t know many teachers who earn £50k, especially in their 30’s…

For cruises I get quotes from TA's all over the place (all over UK and USA) to ensure the best quote. We get 7 night cruises during summer holidays for ~£1-1.5k then flights, Airbnb before/after and a small amount of spending money.

If you're sitting at home without the heating on, and mending the holes in your socks, then possibly you are being too frugal. If you're comfortable and enjoying your life, then fine. If you die within a year or two of retirement, can your children inherit your pension? If not, then don't pay extra into it, just what you have to under your contract as a teacher.

In terms of equity, it's came from a huge amount of sacrifice. Put in approx £35k a year, made approx £60k on first home in a couple of years and have made approx £100k on this home value already.

But presumably you weren’t earning 100k 8 years ago as teachers salaries have scales?

Classroom teachers in Scotland are currently on £49k.
Pension pot is not currently that, that is continuing to work until 65.
On £50k each we could have got a higher mortgage than what we did. No inheritance, just alot of sacrifice.

You can never save too much, if you can save a large amount then good on you, its sensible. Just remember you can't take your grave.

Read the book Die with Zero by Bill Perkins.

He tackles exactly this issue in great depth