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.

Done this and certainly not a million miles away - over estimated my tax but apart from that I was close to spot on

Essentials plus savings - 58%
Holidays - 4
Cars - 2%
Hobbies - 2%
Direct debits (phones, broadband etc) - 1%
tax 22%
pension 12%

The comments from OP about not letting himself spend that sort of money on eating out whilst others are struggling for a meal is super silly. You are not depriving the people struggling for food by eating out. Eating at home does not in itself help the hungry. Eating out might help to keep some restaurants in business and people employed. I have reviewed his posts and as far as I can tell he makes no provision for charitable giving. Maybe a mite hypocritical.

Just a little... I didn't mention charitable giving because it's not something I want to take pride in...but apart from giving approx £400/month to homeless and drug rehabilitation charities and volunteering 2 nights a week at a homeless charity I probably don't do much.

Eating out doesn't stop hunger, you're right....but when you see people who look at a pot noodle like it's a Michelin star meal you've gifted them then it does have an impact.

Thanks anyway, glad I could clear that up for you.

What a fascinating thread!

I guess the question is - what are you saving FOR? Vs what are you living for NOW?

Obviously things like a comfortable retirement - which it sounds like you have covered.

Do you want to send your child/ren to private school?

Do you want to be able to give them a big deposit for/buy them property outright?

Do you want to be able to retire early?

Do you want to buy a second home?

Are you anticipating, as frankly we all should if we can, high care costs in old age?

And so forth. All the above are worthy goals and of course it's just a tiny list of examples.

Financial security is a goal in itself to be sure, but there comes a point where that is more or less achieved. After that, and once you are clear on your goals and feel on track to achieve them, I would ask yourself are you saving emotionally rather than rationally - out of some sort of fear, perhaps, or need for a sense of control? (I certainly recognise that I have a desire to try to control the way my life goes, due to various difficult events in my early childhood, and that a focus on money is often how it ends up being expressed).

I know people who want to accumulate wealth for the sake of it but they are people who love being able to charter private jets, get a box at the football and fly their family to exotic locations for Xmas etc etc - ie they love the high life. That's also a totally reasonable goal IMO but it doesn't seem to be what you're interested in.

So maybe instead of focusing on figures, focus on goals, let the goals shape the figures, and let your life be shaped by the goals, not the figures.

Great point. I would love to travel - I love cruising and would love to afford a few a year when I'm older.
Martin Lewis always makes a point that there's 2 situations to buying things. I think I've found the transition hard from the young 20's skint days of "do I need absolutely need it?" to maybe the slightly more comfortable days of "do I want it/would I like it/would it be helpful"

If your wife's friends want to meet in a cafe, restaurant etc would she say no to this and turn it down?

That's sad to think if she does.

She goes out maybe 5/6 times a year for meals with her friends but most of the time we like active stuff more than eating. I'd rather go out a walk or run with someone and she's the same

Your first post says you don't eat out.

It's all very well and good suggesting to go out for a walk or run when it's freezing cold outside & icy so it's dangerous to walk.

You have never been to a concert, been on a city break in the UK, to a theatre show?
You don't go to the seaside and spend money in arcades/fish chips?
Don't go to National Trust places?

All these things people don't do often, but they do it for the experience with others. The memories.

If it's too dangerous to walk then probably best not either walking or driving out for a meal surely?
We do alot of holidays - I stated that in my first post so that includes city breaks. I wouldn't go away in the UK, far far too expensive. As for days away during the summer, we might go on a couple but spending would be max of about £40-50 (not including petrol).
No interest in concerts, potentially go to the theatre once or twice a year.

If it's too dangerous to walk then probably best not either walking or driving out for a meal surely?
We do alot of holidays - I stated that in my first post so that includes city breaks. I wouldn't go away in the UK, far far too expensive. As for days away during the summer, we might go on a couple but spending would be max of about £40-50 (not including petrol).
No interest in concerts, potentially go to the theatre once or twice a year.

The city breaks you must eat out then.

There are some lovely places in the UK that you're missing out on.

Re the £30 shoes. Cheap shoes/coats etc you pay twice, 3x that amount on as the quality is not as good. (Not always but usually the case I've found)

Nobody knows what will happen in the future.

I'm all for saving money and being careful, but by counting 'every penny' to save for a future you may or may not never have...

You're right...just back from Madeira. 2 coffees + 2 cakes in lovely cafe = £4.60
I may be missing great places in the UK but when Starbucks are charging £6.35 for a hot chocolate then I'll stick to going abroad.
Was in Budapest last year - fresh pasta restaurant - 2 massive pasta dishes, 2 drinks = £12.

In terms of buy cheap buy twice - that's a fair point but I think most of the comments around that time were talking about kids wanting designer trainers where it's also "buy dear, buy twice". I'm all for quality..I'm not a cheapskate, I just like value and sometimes that means spending lots to gain lots...just not with Nike Jordans or whatever they may be

The point I am trying to make is that by counting every penny for a future that you seem sure will happen...

Well it might not happen.

I am all for being careful with money but when I'm shattered after a day at work... My 1 hot chocolate a month I'm not going to be thinking 'wow this £4 hot chocolate is going to make a huge dent my future lifestyle!)

Everything in moderation.

100% it might not happen. All part and parcel of life and the gamble that you have to make of present vs future.

Everything in moderation.

That one meal out a month for example will really not make a huge dent in future finances.

A meal out every day, obviously would.

A pair of nice decent trainers which will last for ages which costs £80, but cheap supermarket trainers would last a month.

Wouldn't buy from a supermarket but there's plenty of Nike/Adidas etc for <£30 and can't see a huge difference in quality between those ones and the £130 ones

An interesting exercise I'd definitely do in your shoes is to sit and plan a dream trip with your wife - and every time you start to factor money into your thinking, stop it. Just see where your dreaming takes you if you just focus on desire and pleasure. Would you stay in an Indian palace on a lake? Charter a vintage yacht around the Greek islands? Tour Australia's wine country? Write it down. Revisit it a few week's later. How would it make you feel to do it? Could you afford it? How does your brain approach answering the question of "can I afford it?"

It's a good exercise in strengthening your "desire muscles" and your ability to lean into pleasure, which from your posts I get the sense isn't something you are in the habit of. Life is all about balancing the now and the next - and while the next is something you seem very good at, what about taking the fullest possible pleasure that the now can afford? There is pleasure in caution - but without pleasure in abundance, too, we make our lives smaller.

You said you would never spend more than £30 on trainers. Depending on what size you are (if you have small feet so can go in the children's section) you cannot get Nike for £30 unless they're in the sale.

I have bought converse for me for about £80. Supermarket knock offs cost way less than that but they do not last.

I pay £80 for converse which lasts for years, whereas the knock offs only last a year. So you end up paying more overtime.

A decent pair of trainers can last years. Cheap pairs do not last I've found.

Same with winter coats. I've had a winter coat which I paid over £100 for over 10 years. Supermarket coats do not last as long as that.

@Mademetoxic I agree with you re winter coats especially. I got a primark cheapie for £22 and I caught it on a door and it's already ripped. It will last this year but I'll have to chuck it after. Plus kids do get bullied for wearing supermarket trainers.

This is such a good point and one that I’m really
mindful of.

In a previous job, I came into contact with an incredible lady who cared for her husband. Both of them in their 50s. He’d been quite high flying and they’d prioritised paying off the mortgage / saving with the view that he’d take early retirement and they’d then have this amazing life together and explore the world. He got early onset dementia and that was the end of it.

Her view was that they would have lived differently if she’d known and that it was incredibly important to enjoy the now rather than planning for a future that was theoretical.

of course I’m not saying spend frivolously and stop saving but for me I make sure that I am able to do the things I enjoy with people I love regularly - dinners, theatre, nice food, nice wine. With an eye on who knows what’s round the corner. If that means I’m putting a bit less into my savings or pension a month that’s ok for me in my 30s.

Really important point, thanks!
I guess the purpose of the thread to begin with (and it's lost its way a long time ago) was to see .... Am I putting enough into my pension? Does the figures seem right? Do I have room to spend more and save less?
It was a genuine question - many people came here, questioned whether I was telling the truth, then said I was showing off etc, it was never about that. I came across a thread where more people said they were earning >£200k a year and I thought maybe I'm not doing enough for the future just now.

@Pensionpot123 Maybe just put the figures into this calculator and get a computer to answer! At least it takes all the judgement out of it.

https://www.hl.co.uk/pensions/pension-calculator

The OP seems to be quite tight & stingy for no reason.

I am all for saving money where possible but sometimes it's better to buy decent quality brands which do cost more, as they last a lot longer.

Not always the case and it's good to shop around but the majority of the time clothes/shoes you get what you pay for.

You live your life very differently to me, but I say good luck to you!
Teaching until 65 + won’t be easy, it’s a demanding job, so if the payoff is a good pension, then enjoy it.
I think your numbers look like you will have a comfortable old age.
I guess, as many have said, just prepare for adapting the plan as things change, and you may not want to work through your 50s and 60s in the same way as your 30s and 40s.
I am quite inspired by some of your travel bargain hunting techniques.
Who knows…in 5 years time you may not be teaching at all, but running the Money Saving Expert version of a travel site!