If you were single, no kids, and expected to stay that way....

[notsomarvelousmrsmaisel]

What would you do to prepare financially for retirement and your elderly life?

Both obvious things and not-so-obvious?

I'm only 38, so it's hardly looming near, but want to be responsible...

I have just moved a lot of my cash savings into investments to make the most of my money. I also make monthly overpayments to my mortgage.

Join the civil service / local government. Good pension and it doesn’t matter there is no ‘pot’ to leave to children.

I like the civil service suggestion.

I would make sure I understood the tax benefits and pros and cons of putting much larger contributions into an employers pension scheme or a SIPP. I’d also build and understanding of how that relates to my employment and other circumstances as it does vary a lot depending on employers policies and personal circumstances.

Go onto Reddit UKPersonalFinance and have a look at the flow chart

I would try and have a paid off home by retirement- something close to amenities and not so big it’s difficult to manage.
I’d work out what pension I’d want to have to live on and start working towards it (I’m not savvy with it, so would probably get advice on this).
I work in the public sector, pension and sick pay is excellent. So I’d second that idea from a PP as I feel quite protected that way (although the salary isn’t that hot, so it’s a trade off)

Do what you can to buy your own home and get it paid off asap, even if it means moving hundreds of miles away and / or buying somewhere smaller than what is ideal. You don’t want to be renting in your old age.

Financially it’s actually simpler than if you have children ect. You need to work out what expenditure you want in retirement, and save up 20x that in a combination of ISAs, pensions and savings. Plus aim for a paid off house, which will then also provide you with late life insurance for care costs. You can choose whether to deduct the state pension from the expenditure or treat it as a bonus if it ever happens, I’d suggest the latter if you want more than a just getting by retirement. Easier said than done of course! Lots of discussion on various FIRE forums about how much you need to save and how.

In terms of investment order I’d save an emergency fund of 12 months income in a cash isa or premium bonds, then maximise pension matching, then max your LISA for the 25% bonus, then put anything you’re paying over 40% tax on into a pension up to the limit, then fill an equity ISA, then throw the rest at your mortgage. But to get to the end of that list you’d need to be saving around £65k a year, in which case congratulations!

civil series great if it suits you job wise, but remember that to retire early you’ll need a gap filler investment as well as the pension fund.

Hiya! I am 35, no kids, decent career, live alone, very single (I can't say I try to date) and own a house (with a mortgage). I am in a similar boat I guess. I am putting all my spare income into my mortgage overpayments/savings with the odd trip to travel, aim to have my mortgage done by May 2027 - I am in the South East.

I am aiming to save for my dream house after that. I am not a fan of a huge mortgage so doing it in stages, especially due to today's economy being temperamental. I want what I deserve in life so refuse to "settle" and "make do" with less just because I am single currently so trying to hit my goals... but also conscious to put too much pressure on myself - what a balance hey.

I am in a pretty safe corporate job, but if they did cut me it would be considered a blessing due to their redundancy policy payout process lol. How about you?

It's nice to know someone is in a similar boat - the single wheel at our ages sometimes feels abit lonely!

Consider this angle you don’t get to share expenses with a partner but you also don’t have the expense of children so they may cancel each other out money wise. I wasn’t bothered about settling down though I did. To really maximise money I lived in shared housing till I was 30. I would consider a lodger but that depends so much on how you as an individual feel like sharing. It’s tax free income up to about 6k PA.

Always have six months living expenses minimum you can access. Its very much max out your ISA, additional mortgage overpayments up to the max without penalty and additional pension contributions, up to 60k PA. I think this is simple and easy stuff and no need for a financial adviser. I did do some risky investing when younger, it paid off but it can go horribly wrong. Any left over chuck in to premium bonds.

Lodger income is up to 7.5k and the only tax break you will ever get as a single person!

Botg paid off house & pension are important … but pension more so because of :

1. tax relief
2. compounding to grow value over time
3. option to pay off mortgage with tax free lump sum

You can always move house to be mortgage free when you retire: you can’t get a Time Machine to give you more years to save

That said: enjoy being fit & healthy too - you can’t take money with you when you go so do what you want to while you are healthy and fit enough

I think this depends on where you job is and whether you want to move. For some renting is not a bad thing, you don't want too much of your capital invested in your home - you have no children to leave it to. It might make more sense to rent and leave yourself with more liquid assets.
Also renting means that when you get older you don't have maintenance issues and when you're retired you can easily move if you want to, either to a new area or simply a more suitable property, without the expense of a sale and purchase.

But you always have service charges to pay for (which go up every year) and this may be a struggle in retirement. Also, buying somewhere with more than one bedroom gives you the option of letting out at least one room, which may provide a valuable income. You don't have that option when renting. Also - you're accruing an asset that's (hopefully) appreciating in value. I agree, though, it can be best to have some liquid assets.

Whether married, single, with or without children, everyone should have in place the following:

Health and care Lasting Power of Attorney (LPA)
Financial Lasting Power of Attorney (LPA)
A will - if you have assets that you want distributed
An encrypted document with all the details of your bank accounts, insurances etc. And a file with policy details.

Personally, I would also have a document that details my wishes in the event of my early death.

I’m not a morbid person but I have lost 2 friends to cancer who were in their late thirties/early forties. Both were married and had just enough time to discuss their wishes. However I have seen the fallout from when someone dies suddenly with nothing in place and it is brutal on a grieving family.

Pay off the house and put money into pensions.

The landlord normally pays service charges, I’m a landlord myself. Accruing capital in property may not be what a child-free person needs, assuming that they can, for example, put the equivalent of mortgage payments into something like an index linked ISA. This has the same tax free income benefits, has potential for tax-free capital gains and is very liquid.
i think that those of us with children think about building assets in terms of what we will leave behind for them.

In @notsomarvelousmrsmaisel ‘s case this doesn’t apply, unless she has close relatives to whom she wishes to leave assets.

A mix of enjoying the here and now whilst topping up pension, overpaying on mortgage and opening a LISA (do it before you are 40).

Definitely owning your own home,aiming to pay it off by retirement age. Paying into a pension, starting as early as possible. But also aiming to have even a small amount of fun money each month - you need to enjoy life too.

Having no partner or kids to worry about when you die means that you could also consider equity release on your home once you’ve retired. No point having that huge asset and not utilising it. Obviously very different if you have kids etc that you want to have an inheritance. But without those responsibilities, nothing wrong with using an asset to make your life easier financially (assuming you explore all the options and pitfalls if care home fees etc are needed).

@angela1952 You’re right about the service charges, I was getting confused with buying a flat.

I still think buying somewhere affordable is the best option. We all need somewhere to live so why not in a property where you can hopefully make a profit or if it doesn’t then you’ve got an asset you can sell if you need to. You can also get a lodger or several for extra revenue. Then there’s equity release, downsizing. Letting it out whilst you go travelling or renting elsewhere, You could have a better choice of care if you sell up and have an huge chunk of equity. Ultimately, a property gives you more options than renting somewhere does. Not having someone to leave the property to in the case of OP doesn’t matter much. I wouldn’t take on a mortgage of more than 20 years if I were 38 - if possible, the astute thing would be to get a small mortgage on a property with more than one bedroom, using a big deposit, with affordable payments and the aim of paying it off asap. Doing so would be a huge game changer but I appreciate everyone’s circumstances are different and it’s harder when you’re single.

I agree with you in many respects, but I think it all depends on whether @notsomarvelousmrsmaisel prefers to be free of the responsibilities of homeowning which become more onerous as you get older.

At the moment the returns on buying a home are not good, people are actually losing money in some cases and there is the threat of CGT or other taxes on homeowning. In the longer term homeowning may not be a better investment than others. A visit to financial advisor is probably a good idea to look at potential ways of investing, main property vs profitable or tax efficient alternatives.
We've had lodgers over the years, usually for financial reasons, we enjoyed it but it isn't everybody's cup of tea. A single person may well have made the choice to be single and prefer to live alone. Hopefully if she has a decent wage and pension it probably isn't necessary either.

In some cases the property you can afford to buy may be less good than the one you can afford to rent, though this varies by region and price level.
Obviously it would be an entirely different story if you wanted to leave your estate to somebody, but otherwise you might as well spend it on simplifying and enjoying your life.

Not strictly speaking for retirement, but income protection and critical illness insurance is sensible financial preparation while you're still working.

Hopefully the worst won't happen but if it does then these should provide some security. And mean you aren't having to utilise savings you'd put aside for your future to get through any tough spells.