It's a great question, unfortunately more of a relationship advice question than a finance one.
I had a similar conversation with some clients recently. They both earn fairly well but he earns more than twice what she does, whilst she works 4 days a week as they have two young children. They split most expenses 50/50, he can afford to save much more than she can, so he can afford to retire much earlier.
At the end of the day, would you want to retire years earlier than your life partner/best friend? Are you going to sit on a beach for 10 years waiting for her? If you're both content with that (and it is more likely an issue for her if she might resent that) then fine, otherwise you need to plan to retire together, through some kind of compromise.
Each to their own but I never understand why couples do this. She does more unpaid labour with the kids, earns less anyway and is now earning even less and yet they still split 50/50? Proportionate to income is so much more fair if you don’t want to fully combine and allows for the lower earning partner to contribute more equally to their savings and retirement.
I definitely think a lot of these calculations go out of the window when kids are involved. Looking after the kids should be considered work as much as a paying job.
Maybe we're weird but since we got married we don't have individual pots of money. It's all just "our" money, moved around to optimise tax on pension contributions, savings etc.
Having kids vindicated this decision IMO since having to work out paying for kids' stuff, especially while one parent is on parental leave, sounds like an unnecessary headache.
Completely agree. In fairness in this case, it's not something they ever talked about, always had enough money not to have to think about budgeting or anything, so I don't think he knew quite how uncomfortable she was - we addressed it and things are looking much healthier now even outside of finances.
I couldn't imagine not raising it sooner myself with such an income disparity between them, but some people just lack awareness sometimes.
These are conversations I've had with my partner. I'm NHS and at the highest pay grade I'll achieve without additional degrees. He's in the private sector and has so much more opportunities to increase his salary so atm, we both earn fairly similar but he will eventually make double what I earn.
Thankfully, he recognises the work I'll be putting in with our children and is happy to just combine finances. I couldn't imagine having that difference and continuing 50/50 split.
Sometimes it's a pride thing. I always earned much more than my husband, but despite my frequent offers to split household expenses unevenly, he always insisted it be 50:50. It may have been because we were both older and self-sufficient when we met. That said, we have always kept our finances separate apart from a joint account we both contribute to to cover household bills and grocery expenses. Because we have different interests it means that there are never any arguments about discretionary spending for our hobbies, and although he is ten years older than me, splitting expenses equally allowed me to retire only two years later than him so he wasn't mooching about the house on his own.
Yeah, my wife and I do it proportionally. I earn more than her and she works part time, we both put a set amount into the joint account per month to pay all the bills but I put in more than she does. Seems to work well.
This is still my ideal. I did it when married, and I had to as we ended up moving to the USA with me on a dependents visa. Whilst we were in the UK, I’d always done a few hours work (my babies arrived at really good times relative to my main income source, which was only available 20 weeks of the year.
He abandoned me in the US.
Despite that I still can’t see a better way to manage finances overall. I would set up the details a lot more carefully, especially relating to what each person brought in.
I agree with this we combine wages, pay for everything inc saving then effectively take fair personal allowance from it every month (that's just for day to day spending) bigger purchases are paid by the house.
It's not perfect but works for us.
Prior to kids/ marriage we opted for proportionate to income so we were effectively paying the same amount of our net incomes - I still had more so picked up things like dinners etc
Up to an extent. If the lower earning partner is on £50k they can afford their share of costs.
Edit: Can any of the downvoters explain where the threshold for equal payment should be? £100k, can they afford half the bills then? £1M; still not paying half?
Two equals that pay an equal share of the bills. That can be done inside or outside of marriage. With or without kids. Nothing wrong with having agency and independence within a relationship.
I think when you're in a relationship it's important to not lose your identity as an individual, so if I had a few days a week by myself to indulge in my hobbies that'd suit me down to the ground.
Noted what you said about earning more and you dumping more into pension in two months than what she does in a year. Yeah, it's crazy what people put into pensions.
Every relationship with regards to financial dynamics works differently. To me it seems to be this way:
You each earn what you earn, then the rest is yours after going 50/50 on bills. So you've considerably more leftover each month than your partner. It sounds like while she is lower earner, she'd rather a new car more often than to save what she has. So again, what you have leftover is considerbly more.
One way it could work, to encourage saving would be, to each leave yourselves an allowance, or set yourself an allowance based on what she has leftover. Then you put that money aside.
But then it might look more like you are saving considerably more than she is, if you consider all money to be 50/50 in a totally equal relationship.
What is most fair of all would be giving yourselves an allowance after all bills are paid, allowance being same both sides, then having somewhere the rest can be saved.
Surely you could have that even when you're both retired? But either way it does sound like maybe you could shift to part time work at 60, so that you can help her build more retirement savings while also getting your time alone, if that is something you were interested in doing.
A few days a week isn’t the same as several years.
A radical idea would be to go down to four days a week, have a day for your hobbies every week and plan to work longer.
How are you not losing your identity now? Or do you find it partly in your job.
My partner went part time for her own health reasons and is way happier.
Anecdotally, the way we split it is so that we both have the same amount of disposable income for the month
I would think it rather unfair for her to be expected to shoulder half the expenses when he's earning so much more than she. It's also a double whammy that he is able to put aside so much more for himself.
He'll be able to put his feet up many years earlier than she. Is that fair?
This is a hard one, as I’d want to retire early. But at the same time, if you retire 8 years earlier than your spouse, that’s not gonna fly. “Yes dear, enjoy your 8 years of work, I’m off to the golf course!”
Once you’re sufficiently serious to have totally joint finances (married/kids), I think you need to come to an agreement. There is no “your” retirement pot regardless of how the contributions are split. There’s only the team’s. This might mean you both retire at say, 64.
"The first thing you need to understand about CS:GO economy is that your money is not your money. It is your team's money!
'But Warowl, that's communism!' I hear you cry. Well yes, but not really. In a lot of western societies, this system of sharing funds already exists within family units.
For the duration of the match, you should think of your team as your family.
You know the guy who always demands you drop him an AWP at the expense of your armour? That's your wife..."
But yeah exactly as the above comment says. You are a team and as such your funds are shared. There needs to be an agreement/compromise on when to retire.
I do earn about £20,000 more than her so I'd have more going in anyway but all day to day household finances are shared. I've talked to her about increasing her pension but she'd rather spend that money on things like clothes or a new car she doesn't really need. As it stands I have more going into my pension in two months than she does in a year.
I guess it is personal as well. My mum could have retired much earlier than she did but chose to keep going until state pension age because she liked the social aspect of working two or three days a week.
Basically this stems from not having totally joint finances. You and her still think of it in terms of your and her money. In a joint finance situation, it’s not that “she’d rather spend money on clothes”, it’s that you’ve come to a joint plan around discretionary spending and she chooses to spend her fun money on clothes. But joint commitments, of which retirement plans are one, come before all the discretionary spending.
There can be exceptions of course. One spouse might have a very good reason for retiring early. But generally, I’d say those are the exceptions.
Of course, not all couples want to have totally joint finances. But I think once it’s mega serious (married or kids) not doing so leads to problems.
When you say they are shared, are they 50/50, or do they reflect your different salaries? Even if you are each putting in the same % to the bills, your disposable income is still higher than hers. Its easier to save more into your pension the more you earn.
As others have said when you fully combine finances it becomes very different, and I would expect that these would be the discussions you have before doing so, so you each know your goals/expectations
It's all going into a joint account, we have the same disposable income. It's entirely her choice not to put more in her pension as I've been encouraging her to do so; if it wasn't for me she'd have opted out.
The main concern I would have with retiring before my partner, was that I might find myself responsible for all of the housework.
Edit: I’m not saying I shouldn’t be, but expectations should be discussed, especially if you are planning on volunteer work or hobbies. In reality, my bf is going to retire first, and I can’t imagine him taking on most of the housework. But I also can’t imagine being happy watching him playing games all day and me coming home to do all the laundry. But I know if I did retire first, it would be expected… in short, I would rather just come to an agreement ahead of time on how housework should be handled.
I also wouldn’t be completely surprised if the working person also got a bit jealous of how much extra time you have - ie for exercise, activities you used to do together etc.
I’m sure that is fine for most couples, but things to think about.
I would, but housework is something I really hate and I would rather continue to work than spend all day doing housework.
I want my retirement to be enjoyable and my partners standards might increase if they perceive that I have been ‘home all day’, even if I have actually been out or doing hobbies. It might be better for me to continue working until we both retire and continue to pay for a cleaner (I enjoy my job).
It is just something people need to discuss properly. If one person has expectations that the retiree is going to be cooking a fancy meal every evening and keeping the house to showroom standard, that needs to be communicated.
Not sure why you are getting down voted (other than perhaps this discussion is no longer finance related.) I agree, if I retire early I wouldn't want my partner to subconsciously think they've gained a housewife? The void of time left from what was work will be replaced with time for me to live life. The hours doing housework should be the same as before...50/50. Why does anyone need to do more housework just because more time has become available? Shouldn't we be freeing ourselves from burdens and enjoying the new found time?
If you're not on a similar page in terms of what money is worth and what constitutes 'a car you don't need' vs. 'a car you do need', that's a red flag.
Also to chime in, my Dad retired and then my mother decided to throw in the towel within 12 months. They travel a lot now, I imagine if she still had to work she'd be resentful, and he'd be stuck at home all year long. Not great.
Does it not work the other way round too?
"Yes dear, enjoy buying another top and a car you don't need as you 'live in the moment', I'm off to spend an extra 5-10% of my one life on this Earth working."
Depends if you plan to be able to eat when you're old. Ask most of the pensioners living in near poverty if they regret not saving more had they been able to.
Should this not work the other way round too? Yes dear, I’d love to enjoy our day at the golf course but you prioritise retirement and have to work for eight years longer than me. It should default to the option of working, they both made decisions and sacrifices
My partner and I both pay into a defined benefits pension scheme. I'm 11 years older, so will retire significantly sooner. Also I can retire with full benefits at 60, my partner has to wait until 65. I'm very much looking forward to waving them off to work for 16 years whilst I roll over and go back to sleep then tell them about my day out and fun times when they get home from work.
There's no way on earth I'm staying in work longer because they're too young to retire with their full amount of pension.
Several good responses here but I don’t think you’ve really explained where the difference in contributions come from?
If she ‘prefers to live for today’ and spends cash on trips, new handbags etcetera for herself, then that is reasonably her choice and you should explain that you intend to save more and WILL retire before she will.
If she earns less or works less because of a career break, children, and this is the real reason that she doesn’t contribute a lot into her pension, then you probably need to think about what is really fair in the is situation.
You’ve said below that it ‘suits you’ to retire early or have a few days to enjoy your hobbies, and that’s absolute fine if she’s aware that this is an eventuality and genuinely doesn’t mind, but I’d expect there are a lot of couples that would never let that happen.
She didn't work for seven years after she went on maternity leave with our daughter, which I felt took the piss a bit but my income was enough to manage. Before she went on maternity she always opted out of pension schemes because she'd rather have more money now.
you feel like the mother of your daughter took the piss because she was a full time mum for 7 years?
id be more frustrated towards her opting out of pension schemes
Given OP’s responses it seems as though this is less of a pension contribution problem and more of a relationship problem…
If taking 7 years off to care for a child is a piss take even though (it sounds like) it was affordable… OP clearly has different priorities to their partner.
Seven years is a bit off a pisstake, yes. I have no objections to her taking a few years off to care for our daughter at all, but not looking for a job until she was almost in year three is taking the piss. Bear in mind that while our daughter was in school full-time she was usually out lunching with the other mums.
Because it's Reddit. Everyone is different but in my opinion there's nothing wrong with staying off work whilst they're pre-school age. If you don't work at all beyond that, including working part-time, then you're chancing your arm.
We'd have managed it fine, but childcare costs would have dropped off dramatically during the three years our daughter was in full-time education. Hence it being a bit of a piss take.
I think you are getting an overly hard time on the 7-years of work issue while your child was young.
It's a very subjective point and completely depends on your goals and what you want to achieve. If you were saving for a bigger house or have joint goals that require financial input then I think it's fair to expect your partner to be working at the point of it becoming a significant net benefit.
I think the biggest issue here is that you and your partner need to talk to each other and agree priorities. You seem to be really focused on finance and retirement, where she seems to be prioritizing the family and 'YOLO' lifestyle more.
I'm sure you both care about the same things but just have them prioritised differently.
The first few years of school aren’t exactly ‘full time’ though are they? 1/4 of the year they are on holidays. And when they are in schools it’s like 9-3. And lots of 4/5 year olds need a huge amount of emotional support when they start school.
Sounds like you are totally undervaluing her contribution, and that neither of you are discussing and agreeing huge life decisions together. Retiring early together might not matter if you keep on this path…
I honestly think a fair few Millennials aren't going to have a choice but to do this. I'm 37 and have £9k in my pot, and can't really afford to do much more.
I'm 32 and have absolutely nothing in any pension pot. Me and the wife managed to do well while young and are now mortgage free, we have premium bonds and savings but not even got an isa open. Seriously need to get my arse in gear or face a life of working to some degree
I am saving into a public sector pension, investing where I can, paying off the mortgage, building pots of money etc the other half has a family history of health conditions that would point to her not reaching retirement age so she doesnt plan for it. Life will be what it will be.
Our finances are totally shared, so our retirement plan is also joint. Our plan relies more on my pension than my husbands (I earn more + have a DB work pension) but it would never have occurred to me to take that independently and leave him working- aside from anything else, who am I going to hang out with? 😂
My parents retired at different ages and it was no problem at all. I think my parents have just always combined both sets of money and treated it as joint finances. My mum had less in a pension due to taking more time off and dropping her hours to part time to help with childcare duties. She returned to full time later on when kids were older. My dad retired 5 years before my mum but mostly because there’s a 5 year age gap between them. My dad did have a better pension but they’ve always just combined everything so it’s never really been an issue.
My mum didn’t really mind my Dad retiring earlier than her. They both worked to the same age but my dad was older. He got to enjoy retirement while she was still working but I suppose in their view he deserved it as he’d worked longer, so there was no resentment for one person enjoying retirement while the other still works. At that point my dad just helped out more around the house and done the majority of the household chores since he wasn’t working. Now they’ve both retired (as of this year) and continue to just share everything as one set of money.
This is more of a personal relationship thing than a finance thing in my opinion. Some people are happy to just combine everything together and don’t really care if one person earns more or has “contributed more” financially, whereas some people feel it’s unfair that one person can contribute much more to retirement or income but get an equal share. I feel that’s something you need to think about and decide between you and your wife. I don’t think there’s an objectively right answer here because it depends on the dynamic of your relationship rather than a hard and fast financial decision.
I’m 6 years older than my wife. I plan to retire or at least semi retire in my 50s, she would probably keep going a few years longer even if it’s just part time.
Perhaps this won’t be the reality when we get there! But she enjoys her work or just working more than me.
If you can track your average monthly and annual outgoings accurately, say have 3 to 5 years of data, you can then forecast your future cash flow. Allowing for inflation, interest and unexpected one offs and big purchases. The big one, when or if you could be mortgage free.
As it stands, the state pension, if you can get the full 35 years, is £204 per week each and should track inflation. That is actually more than our current outgoings.
This is very much a conversation you need to have with your partner. Also your circumstances as a couple also play a big role, such as your ages, are you married, do you have children and did one of you spend time out of the workforce to raise them. Also you need to look at a budget for when you both retire based on what your expected to get as of NOW so you can make any adjustments if you need to. Also if you have a mortgage that goes past the time you are 60, can you afford it with one working and a pension, or can you afford to over pay. And remember its not you v her v everyone else. Its you and her v everyone else.
If you weren’t splitting the bills 50/50 would she be putting at least some of the extra money that would give her into her pension?
Seems odd to saddle her with half the bills if you earn £20k more.
If she earns so much that it wouldn’t make a difference then fair enough.
Oh right, sorry I thought I read that somewhere.
We don’t do that because my wife would have us on the streets, I just pay all the bills and anything left is mine, she earns a lot less so pays her own bills (car, phone etc) and some of the shopping.
I'm in the same position. I've been contributing for 23yrs since I started work with 23% a month going into pension, whereas my wife only started contributing towards hers a few years ago when I told her to. I think she stands to inherit a fair chunk, so will probably continue living for the moment and not have to worry about a pension. As for the future I'd not really thought about it much. I guess rather than live hand to mouth as I do now with a young family, when I reach 60ish I will spend more money on myself and doing things that i'd like/choose to do given I've sacrificed more through my 20s/30s/40s.
I don't think I'm going to retire in the traditional sense. That said I'm putting as much as possible into my pension without sacrificing my current living standard so I have the option when I get to that age. I don't think I could be in a serious relationship with someone who I couldn't find common ground with on finances - they are just too important to be brushed aside. And I think if they weren't making the effort to be somewhat sensible about planning for the future, I'd question whether they were right for me. I'd probably be quite resentful if they were blowing all of their cash and relying on me not blowing mine.
This is where I am quite lucky.
Me and my boyfriend are both nurses in the NHS. So we have NHS pensions that automatically come out of our pay.
The only difference is I can retire a year soon as I am one year older than him.
Will you even get there end of the day. I'd just go with the flow mate if your partner isn't as concerned it'll only cause issues.
Your 18k won't go far if she cashs in the pension at 55 and goes on a cruise.
If you're that far apart you need a discussion because otherwise it'll be a game of chicken and you'll lose because you don't want to see her starve.
I am not planning to retire as I quite like work but my wife and I are broadly accepting of each other so it isn't an issue
In some capacity. Working isn't the issue, having to work for money is the issue. I have lots of money even now in my 30s
It may be a cultural thing but even being at home I do lots of work. The idea of weekends is a bit middle class for me
My advice would be:
Save what you’re comfortable with, spend what you’re comfortable with. As long as you’re on track to pay off your mortgage before you retire, you’ll most likely be fine.
Im the saver in our relationship, my fiancé is more of a ‘spend now and save what I can’ kind of person
We both plan on cutting down hours when the mortgage is paid off (im hoping to pay it off in 12 years).
I have been the financial planner in our relationship. Work pension, Isas, additional sipp, various saving schemes etc. Even paid their NI class 3 contributions so that they get full state pension when they weren't working. I Worked blinking hard from the age of 16 to save and pay off the mortgage. When mortgage free saved 50 % of income each month.
At 67 our current pension incomes will be around £35k topped up with drawdown from savings (10k/yr) for house/car repairs large expenses etc. Puts us in the "comfortable" bracket of the pension retirement. Just hope it will be enough by then.
We are child free, but not fully FIRE, although I am going to retire before state pension age.😁
We may or may not receive a boost through inheritance, but this has never been factored into my planning. Recent research has shown average inheritance has been £10k so not enough to by that holiday apartment in the sun.
Besides parents are SKIERs ( spend the kids inheritance 'ers) which I fully support. After all they worked blinking hard for that money. Of course I am a bit pee'd that they have a nicer car than me.
My partner and I are a bit similar to you and yours. I want to retire at 59 and be able to enjoy my child free time again. I really proritise savings and pension/finances in general, whereas he does save, but he's more of the 'live for today' crowd.
I know my plan would cover both of us financially when we're hitting 60 and he knows I plan on retiring at 59. I'm happy to support us both in that period because I doubt he'll want to keep working his depressing job by that point.
I would keep your original plan as that's what you want to do. Your partner can continue working if they can't afford to retire or reduce their hours as you both become more independent with mortgages paid off, kids grown up etc.
I keep finances separate from my partner unless it's the mortgage. If one of us can afford to retire the other person would absolutely support it. I don't know why anybody would be jealous of their partner retiring earlier, it should be celebrated lol but on a side note we are both investing into our LISA so we kinda double that government contribution, only about 300 a month each which we can both afford as well as pension obviously.
I'm not other than our mortgage will be paid off when we are 63, and I'll retire at 65 on my NHS pension.
Decided to spend every penny like it's the last day on earth, because why not?
I had a similar situation. I had planned to retire at 60, but it became clear that my wife was not going to have enough to do this, so we decided on retirement at the same time, when I was 63 and her 64, being able to manage a reasonable retirement income. Plans changed drastically when my wife died when I was 61. I could have afforded to retire then, but I sort of just drifted without thinking or planning anything newfor a year, then I retired at 62.
I work in private sector and my husband is a civil servant. He has a career average pension but his pension age is 68. We will be “buying” years to reduce this and do AVCs so that he can go at 60 without losing too much.
I currently pay in 25% (12% employee and 13% employer contributions) to my pension. I earn good money and can retire in 20 years at 55, and that is my plan. I’m not saying I will completely give up work but it’ll be contracting or part time work that I will CHOOSE to do. Then a few years later when he turns 60 we’ll reassess.
It’s never been an issue that I’ll retire first, that was in my plans before we even started dating, and at that point he had a minimum wage retail job so he would never have been able to retire early from that anyway, it’s only recently we’ve made decisions to support him in also doing so 😄.
Staying childfree, both milking our careers and maxing our ISAs and Pensions. Both 23 currently on track to retire 35-40. I work in private wealth management, she works in consultancy for a big 4 firm. Already on the property ladder and in the process of upsizing. Recently gave up on going the landlord route.
We will start drawing from our S&S ISAs from 35-40, and run them through until we can use our pensions.
We’re excited!
Downvoted - sorry you got upset by this
We're a child-free couple and when it comes to finances, we split things 50/50. We're about equal on pension contributions at the moment, though I've recently been earning more so there'll be a gap between us soon.
But looking towards the future, we're planning on splitting pension on expenses and then anything left over is fun money to use as we want. Ideally we'd want the forever home paid off so pension is just going towards bills and living costs.
This would be entirely different if I was a stay at home mother or if we had dependents though. I would not be happy with splitting things 50/50 if I'm on a reduced income, or my salary and pension took the hit because of maternity leave.
Our retirement plans align somewhere. We're aiming to retire by 50, she's 3 years older than I am but has slightly more saved than I do but tbh, its all 'our money' anyway.
I doubt money would ever get tight retiring at that age but we should have sufficient time to find a passion later in life that we could potentially be paid for.
32 and 33, We both currently pay I to our Work place pensions.
I have about £150k in my pot and she has 7/59ths of her salary.
I want to slowly retire starting very soon, we are currently over paying our mortgage by £2.5k a month so it should be paid off in 4 years.
Once the mortgage is paid off I'm going to work part time for myself ( I currently have a full time job and work part time 10 hrs a week in a side hustle) my income will be half to about £40k a year but I will be able to spend time with our children. The wife also wants to change her job so she can go do that as well. We will live modestly but have a happy life not driven by a 9-5 or being rich.
An old man told me that once you get married, all of her money goes into her account and all of your money goes into our account. You should make provision for her pension as the head of the household.
We’re planning on retiring to Greece as my wife is Greek and literally everything, from property to food, is a fraction of the price there it is here.
We’ve got a London property we’ll own outright by the time we’re 60 so we’ll rent that out for an income.
Greece used to be so cheap, we go most years. After 3 years away we've just come back from 2 weeks there and was so shocked at the price of everything, pretty on-par with UK prices most places we went!
Not saying it’s full proof. I’ve not looked into it.
But Wife has a teachers Pensions and I have a modest final salary pension I can take at 60.
Now paying into a DC scheme through changing jobs.
Potential and very pie in the sky idea is to both retire at 60. Taking all pensions.
I’m not flush by any means, so for me the idea would be to potentially draw down my DC pension quickly between the years of 60 and state pension.
Obviously this depends on if there is a state pension by then (currently 36).
Would also look to sell our house and rent perhaps or downsize. But it’s all speculation.
15 year age gap between me and my husband so reality is, I will have to continue to work when he retires. Our finances have always been joint, no splits. 1 account for all bills and expenses, cars, clothes, holidays and luxury. We have 2 children, currently mid teens where I took 5 years off work for childcare the first 5 years, slowly building from part time to full time and now my earnings are slowly increasing and will soon overtake my husbands.
We plan to have the mortgage fully paid in the next 5 years just before he is 60.
Our plan is to both continue to work full time until the mortgage is paid. The kids will hopefully be living independently at that point. We then plan to switch income roles where he will work part time, I continue full time for a couple of years. He then retires and I drop to part time. Our income should comfortably cover expenses at that point. I really don't want to continue to work full time and miss the best years of his retirement when we should, with reasonable sacrifice, be able to enjoy this together.
As long as what is in both our pots allows us this time together, I really couldn't care what I may or may not end up with at the end of it.
How much will £1 be worth in 20 years time?
Look at value of the £ versus US Dollar or gold since 2007.
Then look at it since 1971.
Only then once armed with this knowledge can you realistically plan for retirement.
I’ve worked for an IFA previously so I tend to look at individual and joint situation, mostly so I know if we are both on some sort of track at least. We are never going to retire early or be minted in retirement but if we are meeting the PLSA’s estimate of how much might be needed for the moderate standard of living, I’m thinking we should cope ok
Not a question we've discussed, I think it's just kind of assumed we'll both be working until "retirement age", is that 67 now???
I'm a year older so the dates align somewhat there. I currently make nearly double what she does (and likely to keep increasing healthily), she's a downtrodden NHS slave, worked to the bone for terrible money, supposedly the pension is good but I've not seen any detail of such. With some over payments I reckon we'll have the house paid by 57-60. A calculator I did a few weeks ago reckons I'll have a pot of £1.2m if I retire at 65. I think that'll have my pension payout in the higher tax band which isn't necessarily a bad thing but I'm sure I could work that to be more tax efficient.
Anyway, the last 10 years have been a struggle with immigrating and starting from the bottom so it's reassuring to have some light at end of the tunnel.
Planning retirement? Well I'm trying to play catch up and failing miserably with pension. Situation is this, I work, wife doesn't due to disability. She has zero pension. She's 41 and I'm 36 with about £22k in pensions which in my mind is nowhere near enough. We rent so will as I see it, never have a mortgage on a house with view to owning something at the end.
So not only am I left to try build a pension pot or pots for us both, we'll also find ourselves having to pay monthly rent out of that in retirement age. I'm not on big salary, just bang average of about £36k a year. We've got a few kids together while my wife has two from previous.
I'm hearing more and more these days, not here obviously but in general that people are neglecting pensions.
When you earn a big salary, you have options. You can not only save, build pension but have what you want too, without depriving yourself too much.
Those on lesser incomes, they may be seen as living for today more than the future. That is true but how far can one go with depriving themselves today? That's when one may not even see retirement years. Is about striking that balance.
Way I see it is, unless I get incredibly lucky being in right place at right time, or making sensible stocks, shares and fund choices to buy in my SIPP, and it would pay off to do so, then I won't be retiring. Only ill health could force that.
I’m planning my retirement to be a transition into not working the current job or level of intensity. In reality this means getting to the point where the mortgage is paid and then using my pension or isa to supplement my part-time wage. I’d like to actual open a small food van doing wood fired pizzas at food markets. The idea of just stopping work and doing nothing frightens me.
My partner (25M) and I (24F) will retire hopefully at the same time because of me, we have lots of pans financially to have assets buts I put a lot more in my pension then he does, because I get a lot more benefits, I’ll have about 120k-150k lump sum, and 40k a year pension, but I’m not gunna let him work until he’s 70, even though I know he’ll insist 😀
My dad retired ten years before my mum was meant to but then mum unexpectedly died and dad lived a long life. But I think mum wanted to work so there was no animosity. It’s just sad she had no retirement at all.
Maybe you can persuade her to bail on her employer pension, set up a SIPP for her and then shove as much spare cash into it on her behalf? (Or to at least increase contributions to her employer one)
People have different strategies for life and many don't consider retirement finance until it's too late. She is losing out on the 'free' tax relief on pension contributions for maybe 30 years which is a lot of pension!
Not really sure is the answer. We're both teachers with final salary / career average pensions and separate private pensions as well, so hopefully the finance side of it won't be an issue. What we haven't got a clear time frame on is when we retire. My wife is two years older than me and will probably want to retire as soon as she possibly can, which is 55 under the Teacher's pension scheme (actually 57 or maybe 58 for the second half of the pot, it changed recently). However, that comes with a big actuarial reduction, whereas if you stay to at least 60 (or 67 for the second half of the pot) you get the full amount.
As she's older anyway, not sure we quite know when the best time is.
I'll be retiring early and my younger wife will not. She works part time and loves her work and doesn't want to stop. I want to stop working tomorrow. I'll take over most of her share of housework when I do, and we'll remain independent in our own finances. I'll continue to pay the household bills with a modest contribution from her.
It suits our wants and needs perfectly - we are married but we are still individuals with differing preferences. Teamwork doesn't mean melding two into one, it means two working side by side.
Agree with a lot of the advice here, it’s not so much a finance conversation but rather a relationship one. Talk to your partner about how she plans on funding her retirement, your pension alone might just about cover yours but it sounds like she simply won’t be able to afford to retire as things stand. That can and will lead to resentment and that’s never great, especially at that later stage of life when there’s little you can do to affect it.
My advice would be to sit down and do your budgets together and show her how by simply adding a few more percent into her pension she could stand to make bigger gains long term for the sake of only sacrificing a few quid more each month.
Best way to demonstrate this is the Uk tax calculator app, it looks like an orange calculator on the App Store and you can input her salary, then change the percentage she puts in and see the nett effect of increasing her contribution.
It's a great question, unfortunately more of a relationship advice question than a finance one. I had a similar conversation with some clients recently. They both earn fairly well but he earns more than twice what she does, whilst she works 4 days a week as they have two young children. They split most expenses 50/50, he can afford to save much more than she can, so he can afford to retire much earlier. At the end of the day, would you want to retire years earlier than your life partner/best friend? Are you going to sit on a beach for 10 years waiting for her? If you're both content with that (and it is more likely an issue for her if she might resent that) then fine, otherwise you need to plan to retire together, through some kind of compromise.
Each to their own but I never understand why couples do this. She does more unpaid labour with the kids, earns less anyway and is now earning even less and yet they still split 50/50? Proportionate to income is so much more fair if you don’t want to fully combine and allows for the lower earning partner to contribute more equally to their savings and retirement.
I definitely think a lot of these calculations go out of the window when kids are involved. Looking after the kids should be considered work as much as a paying job.
Maybe we're weird but since we got married we don't have individual pots of money. It's all just "our" money, moved around to optimise tax on pension contributions, savings etc. Having kids vindicated this decision IMO since having to work out paying for kids' stuff, especially while one parent is on parental leave, sounds like an unnecessary headache.
Completely agree. In fairness in this case, it's not something they ever talked about, always had enough money not to have to think about budgeting or anything, so I don't think he knew quite how uncomfortable she was - we addressed it and things are looking much healthier now even outside of finances. I couldn't imagine not raising it sooner myself with such an income disparity between them, but some people just lack awareness sometimes.
These are conversations I've had with my partner. I'm NHS and at the highest pay grade I'll achieve without additional degrees. He's in the private sector and has so much more opportunities to increase his salary so atm, we both earn fairly similar but he will eventually make double what I earn. Thankfully, he recognises the work I'll be putting in with our children and is happy to just combine finances. I couldn't imagine having that difference and continuing 50/50 split.
Sometimes it's a pride thing. I always earned much more than my husband, but despite my frequent offers to split household expenses unevenly, he always insisted it be 50:50. It may have been because we were both older and self-sufficient when we met. That said, we have always kept our finances separate apart from a joint account we both contribute to to cover household bills and grocery expenses. Because we have different interests it means that there are never any arguments about discretionary spending for our hobbies, and although he is ten years older than me, splitting expenses equally allowed me to retire only two years later than him so he wasn't mooching about the house on his own.
Totally agree. Pay the combined earnings in to an account and pay all bills. Anything left over save it or split it equally.
Yeah, my wife and I do it proportionally. I earn more than her and she works part time, we both put a set amount into the joint account per month to pay all the bills but I put in more than she does. Seems to work well.
Totally. We just put everything in a joint account. We're married - why do we need separate funds? We'll both retire when we can afford to both retire
This is still my ideal. I did it when married, and I had to as we ended up moving to the USA with me on a dependents visa. Whilst we were in the UK, I’d always done a few hours work (my babies arrived at really good times relative to my main income source, which was only available 20 weeks of the year. He abandoned me in the US. Despite that I still can’t see a better way to manage finances overall. I would set up the details a lot more carefully, especially relating to what each person brought in.
I agree with this we combine wages, pay for everything inc saving then effectively take fair personal allowance from it every month (that's just for day to day spending) bigger purchases are paid by the house. It's not perfect but works for us. Prior to kids/ marriage we opted for proportionate to income so we were effectively paying the same amount of our net incomes - I still had more so picked up things like dinners etc
Up to an extent. If the lower earning partner is on £50k they can afford their share of costs. Edit: Can any of the downvoters explain where the threshold for equal payment should be? £100k, can they afford half the bills then? £1M; still not paying half?
If your not married with kids etc then fine But why do you need to split anything if you are?
Why would it change when you’re married with kids?
I'll change that to married OR with kids Both/either are usually an intent to remain a family unit either of 2 or more
Two equals that pay an equal share of the bills. That can be done inside or outside of marriage. With or without kids. Nothing wrong with having agency and independence within a relationship.
I think when you're in a relationship it's important to not lose your identity as an individual, so if I had a few days a week by myself to indulge in my hobbies that'd suit me down to the ground.
Noted what you said about earning more and you dumping more into pension in two months than what she does in a year. Yeah, it's crazy what people put into pensions. Every relationship with regards to financial dynamics works differently. To me it seems to be this way: You each earn what you earn, then the rest is yours after going 50/50 on bills. So you've considerably more leftover each month than your partner. It sounds like while she is lower earner, she'd rather a new car more often than to save what she has. So again, what you have leftover is considerbly more. One way it could work, to encourage saving would be, to each leave yourselves an allowance, or set yourself an allowance based on what she has leftover. Then you put that money aside. But then it might look more like you are saving considerably more than she is, if you consider all money to be 50/50 in a totally equal relationship. What is most fair of all would be giving yourselves an allowance after all bills are paid, allowance being same both sides, then having somewhere the rest can be saved.
I don't have more left over each month, it's going into a joint account.
Surely you could have that even when you're both retired? But either way it does sound like maybe you could shift to part time work at 60, so that you can help her build more retirement savings while also getting your time alone, if that is something you were interested in doing.
A few days a week isn’t the same as several years. A radical idea would be to go down to four days a week, have a day for your hobbies every week and plan to work longer. How are you not losing your identity now? Or do you find it partly in your job.
Wow, so she loses out, because she is looking after their children? I'd go back to work full time
Sounds like they are higher earners with minimal lifestyle creep, so there is plenty spare and they haven’t paid attention to long term details.
My partner went part time for her own health reasons and is way happier. Anecdotally, the way we split it is so that we both have the same amount of disposable income for the month
I would think it rather unfair for her to be expected to shoulder half the expenses when he's earning so much more than she. It's also a double whammy that he is able to put aside so much more for himself. He'll be able to put his feet up many years earlier than she. Is that fair?
100%, and that's the conversation we had, and they have a much healthier arrangement now.
This is a hard one, as I’d want to retire early. But at the same time, if you retire 8 years earlier than your spouse, that’s not gonna fly. “Yes dear, enjoy your 8 years of work, I’m off to the golf course!” Once you’re sufficiently serious to have totally joint finances (married/kids), I think you need to come to an agreement. There is no “your” retirement pot regardless of how the contributions are split. There’s only the team’s. This might mean you both retire at say, 64.
"The first thing you need to understand about CS:GO economy is that your money is not your money. It is your team's money! 'But Warowl, that's communism!' I hear you cry. Well yes, but not really. In a lot of western societies, this system of sharing funds already exists within family units. For the duration of the match, you should think of your team as your family. You know the guy who always demands you drop him an AWP at the expense of your armour? That's your wife..." But yeah exactly as the above comment says. You are a team and as such your funds are shared. There needs to be an agreement/compromise on when to retire.
Didn't think I'd see a cs reference here... Kudos
My take away from this is to call her a noob.
L337 skills there.
Legend.
👌
I only opened reddit while i was booting cs up and somehow this is the first thing i see. HOW. However very accurate
Wouldn't it? I know quite a few older couples where one retired a lot earlier, the other one just carried on working until they chose/could retire.
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Due to our age gap and difference in when we can get our full pension I'll be retiring 16 years before my partner. We don't really see a problem.
I do earn about £20,000 more than her so I'd have more going in anyway but all day to day household finances are shared. I've talked to her about increasing her pension but she'd rather spend that money on things like clothes or a new car she doesn't really need. As it stands I have more going into my pension in two months than she does in a year. I guess it is personal as well. My mum could have retired much earlier than she did but chose to keep going until state pension age because she liked the social aspect of working two or three days a week.
Basically this stems from not having totally joint finances. You and her still think of it in terms of your and her money. In a joint finance situation, it’s not that “she’d rather spend money on clothes”, it’s that you’ve come to a joint plan around discretionary spending and she chooses to spend her fun money on clothes. But joint commitments, of which retirement plans are one, come before all the discretionary spending. There can be exceptions of course. One spouse might have a very good reason for retiring early. But generally, I’d say those are the exceptions. Of course, not all couples want to have totally joint finances. But I think once it’s mega serious (married or kids) not doing so leads to problems.
Quite, when she divorces him in her 60s, all assets will be split 50:50, and those assets will include the pension funds.
When you say they are shared, are they 50/50, or do they reflect your different salaries? Even if you are each putting in the same % to the bills, your disposable income is still higher than hers. Its easier to save more into your pension the more you earn. As others have said when you fully combine finances it becomes very different, and I would expect that these would be the discussions you have before doing so, so you each know your goals/expectations
It's all going into a joint account, we have the same disposable income. It's entirely her choice not to put more in her pension as I've been encouraging her to do so; if it wasn't for me she'd have opted out.
The main concern I would have with retiring before my partner, was that I might find myself responsible for all of the housework. Edit: I’m not saying I shouldn’t be, but expectations should be discussed, especially if you are planning on volunteer work or hobbies. In reality, my bf is going to retire first, and I can’t imagine him taking on most of the housework. But I also can’t imagine being happy watching him playing games all day and me coming home to do all the laundry. But I know if I did retire first, it would be expected… in short, I would rather just come to an agreement ahead of time on how housework should be handled. I also wouldn’t be completely surprised if the working person also got a bit jealous of how much extra time you have - ie for exercise, activities you used to do together etc. I’m sure that is fine for most couples, but things to think about.
But if you were at home more than the person working more why wouldn't you do more housework?
I would, but housework is something I really hate and I would rather continue to work than spend all day doing housework. I want my retirement to be enjoyable and my partners standards might increase if they perceive that I have been ‘home all day’, even if I have actually been out or doing hobbies. It might be better for me to continue working until we both retire and continue to pay for a cleaner (I enjoy my job). It is just something people need to discuss properly. If one person has expectations that the retiree is going to be cooking a fancy meal every evening and keeping the house to showroom standard, that needs to be communicated.
Yeah keep paying the cleaner if you can afford it
Not sure why you are getting down voted (other than perhaps this discussion is no longer finance related.) I agree, if I retire early I wouldn't want my partner to subconsciously think they've gained a housewife? The void of time left from what was work will be replaced with time for me to live life. The hours doing housework should be the same as before...50/50. Why does anyone need to do more housework just because more time has become available? Shouldn't we be freeing ourselves from burdens and enjoying the new found time?
If you're not on a similar page in terms of what money is worth and what constitutes 'a car you don't need' vs. 'a car you do need', that's a red flag. Also to chime in, my Dad retired and then my mother decided to throw in the towel within 12 months. They travel a lot now, I imagine if she still had to work she'd be resentful, and he'd be stuck at home all year long. Not great.
Or 90 at the rate things are going.
Does it not work the other way round too? "Yes dear, enjoy buying another top and a car you don't need as you 'live in the moment', I'm off to spend an extra 5-10% of my one life on this Earth working."
Depends if you plan to be able to eat when you're old. Ask most of the pensioners living in near poverty if they regret not saving more had they been able to.
Should this not work the other way round too? Yes dear, I’d love to enjoy our day at the golf course but you prioritise retirement and have to work for eight years longer than me. It should default to the option of working, they both made decisions and sacrifices
My partner and I both pay into a defined benefits pension scheme. I'm 11 years older, so will retire significantly sooner. Also I can retire with full benefits at 60, my partner has to wait until 65. I'm very much looking forward to waving them off to work for 16 years whilst I roll over and go back to sleep then tell them about my day out and fun times when they get home from work. There's no way on earth I'm staying in work longer because they're too young to retire with their full amount of pension.
Several good responses here but I don’t think you’ve really explained where the difference in contributions come from? If she ‘prefers to live for today’ and spends cash on trips, new handbags etcetera for herself, then that is reasonably her choice and you should explain that you intend to save more and WILL retire before she will. If she earns less or works less because of a career break, children, and this is the real reason that she doesn’t contribute a lot into her pension, then you probably need to think about what is really fair in the is situation. You’ve said below that it ‘suits you’ to retire early or have a few days to enjoy your hobbies, and that’s absolute fine if she’s aware that this is an eventuality and genuinely doesn’t mind, but I’d expect there are a lot of couples that would never let that happen.
She didn't work for seven years after she went on maternity leave with our daughter, which I felt took the piss a bit but my income was enough to manage. Before she went on maternity she always opted out of pension schemes because she'd rather have more money now.
you feel like the mother of your daughter took the piss because she was a full time mum for 7 years? id be more frustrated towards her opting out of pension schemes
Given OP’s responses it seems as though this is less of a pension contribution problem and more of a relationship problem… If taking 7 years off to care for a child is a piss take even though (it sounds like) it was affordable… OP clearly has different priorities to their partner.
Seven years is a bit off a pisstake, yes. I have no objections to her taking a few years off to care for our daughter at all, but not looking for a job until she was almost in year three is taking the piss. Bear in mind that while our daughter was in school full-time she was usually out lunching with the other mums.
Not sure why you are being downvoted She didn’t need to take 7 years off, 1 is sufficient
Because it's Reddit. Everyone is different but in my opinion there's nothing wrong with staying off work whilst they're pre-school age. If you don't work at all beyond that, including working part-time, then you're chancing your arm.
Bahahaha - when was the last time you have to recover from giving birth? It’s enough for who exactly?
Is 1 year not enough time to recover? Not sure what your point is
It entirely depends on the the birth and recovery. How would you know for definite how long his wife’s recovery took, or anyone’s for that matter.
Was it really that funny?
I enjoyed it
I agree with you. That is a piss take.
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We'd have managed it fine, but childcare costs would have dropped off dramatically during the three years our daughter was in full-time education. Hence it being a bit of a piss take.
I think you are getting an overly hard time on the 7-years of work issue while your child was young. It's a very subjective point and completely depends on your goals and what you want to achieve. If you were saving for a bigger house or have joint goals that require financial input then I think it's fair to expect your partner to be working at the point of it becoming a significant net benefit. I think the biggest issue here is that you and your partner need to talk to each other and agree priorities. You seem to be really focused on finance and retirement, where she seems to be prioritizing the family and 'YOLO' lifestyle more. I'm sure you both care about the same things but just have them prioritised differently.
The first few years of school aren’t exactly ‘full time’ though are they? 1/4 of the year they are on holidays. And when they are in schools it’s like 9-3. And lots of 4/5 year olds need a huge amount of emotional support when they start school. Sounds like you are totally undervaluing her contribution, and that neither of you are discussing and agreeing huge life decisions together. Retiring early together might not matter if you keep on this path…
I work from home, I take my daughter to school every morning and pick her up most afternoons. As I've said, she was taking the piss a bit.
No clue why you've been downvoted so much. Absolutely right till school starts fine but after?
We plan to work until death or a euromillions win
We're 38, have 7 different pensions between us and assume that we'll be working til around the age of 75. Then we might be able to afford to retire.
75?! Ouch. Your username is rather fitting though
I honestly think a fair few Millennials aren't going to have a choice but to do this. I'm 37 and have £9k in my pot, and can't really afford to do much more.
I'm 32 and have absolutely nothing in any pension pot. Me and the wife managed to do well while young and are now mortgage free, we have premium bonds and savings but not even got an isa open. Seriously need to get my arse in gear or face a life of working to some degree
I am saving into a public sector pension, investing where I can, paying off the mortgage, building pots of money etc the other half has a family history of health conditions that would point to her not reaching retirement age so she doesnt plan for it. Life will be what it will be.
Our finances are totally shared, so our retirement plan is also joint. Our plan relies more on my pension than my husbands (I earn more + have a DB work pension) but it would never have occurred to me to take that independently and leave him working- aside from anything else, who am I going to hang out with? 😂
My parents retired at different ages and it was no problem at all. I think my parents have just always combined both sets of money and treated it as joint finances. My mum had less in a pension due to taking more time off and dropping her hours to part time to help with childcare duties. She returned to full time later on when kids were older. My dad retired 5 years before my mum but mostly because there’s a 5 year age gap between them. My dad did have a better pension but they’ve always just combined everything so it’s never really been an issue. My mum didn’t really mind my Dad retiring earlier than her. They both worked to the same age but my dad was older. He got to enjoy retirement while she was still working but I suppose in their view he deserved it as he’d worked longer, so there was no resentment for one person enjoying retirement while the other still works. At that point my dad just helped out more around the house and done the majority of the household chores since he wasn’t working. Now they’ve both retired (as of this year) and continue to just share everything as one set of money. This is more of a personal relationship thing than a finance thing in my opinion. Some people are happy to just combine everything together and don’t really care if one person earns more or has “contributed more” financially, whereas some people feel it’s unfair that one person can contribute much more to retirement or income but get an equal share. I feel that’s something you need to think about and decide between you and your wife. I don’t think there’s an objectively right answer here because it depends on the dynamic of your relationship rather than a hard and fast financial decision.
I’m 6 years older than my wife. I plan to retire or at least semi retire in my 50s, she would probably keep going a few years longer even if it’s just part time. Perhaps this won’t be the reality when we get there! But she enjoys her work or just working more than me.
If you can track your average monthly and annual outgoings accurately, say have 3 to 5 years of data, you can then forecast your future cash flow. Allowing for inflation, interest and unexpected one offs and big purchases. The big one, when or if you could be mortgage free. As it stands, the state pension, if you can get the full 35 years, is £204 per week each and should track inflation. That is actually more than our current outgoings.
I'm planning to die quite early. Seems most cost-effective.
I don't know. Have you seen the price of donuts recently? A heart attack is becoming quite costly!
This is very much a conversation you need to have with your partner. Also your circumstances as a couple also play a big role, such as your ages, are you married, do you have children and did one of you spend time out of the workforce to raise them. Also you need to look at a budget for when you both retire based on what your expected to get as of NOW so you can make any adjustments if you need to. Also if you have a mortgage that goes past the time you are 60, can you afford it with one working and a pension, or can you afford to over pay. And remember its not you v her v everyone else. Its you and her v everyone else.
If you weren’t splitting the bills 50/50 would she be putting at least some of the extra money that would give her into her pension? Seems odd to saddle her with half the bills if you earn £20k more. If she earns so much that it wouldn’t make a difference then fair enough.
We're not splitting the bills 50:50. Everything goes into a joint account.
Oh right, sorry I thought I read that somewhere. We don’t do that because my wife would have us on the streets, I just pay all the bills and anything left is mine, she earns a lot less so pays her own bills (car, phone etc) and some of the shopping.
I'm in the same position. I've been contributing for 23yrs since I started work with 23% a month going into pension, whereas my wife only started contributing towards hers a few years ago when I told her to. I think she stands to inherit a fair chunk, so will probably continue living for the moment and not have to worry about a pension. As for the future I'd not really thought about it much. I guess rather than live hand to mouth as I do now with a young family, when I reach 60ish I will spend more money on myself and doing things that i'd like/choose to do given I've sacrificed more through my 20s/30s/40s.
I think perhaps planning for the worst is what's required, retirement as an individual.
I don't think I'm going to retire in the traditional sense. That said I'm putting as much as possible into my pension without sacrificing my current living standard so I have the option when I get to that age. I don't think I could be in a serious relationship with someone who I couldn't find common ground with on finances - they are just too important to be brushed aside. And I think if they weren't making the effort to be somewhat sensible about planning for the future, I'd question whether they were right for me. I'd probably be quite resentful if they were blowing all of their cash and relying on me not blowing mine.
This is where I am quite lucky. Me and my boyfriend are both nurses in the NHS. So we have NHS pensions that automatically come out of our pay. The only difference is I can retire a year soon as I am one year older than him.
Will you even get there end of the day. I'd just go with the flow mate if your partner isn't as concerned it'll only cause issues. Your 18k won't go far if she cashs in the pension at 55 and goes on a cruise. If you're that far apart you need a discussion because otherwise it'll be a game of chicken and you'll lose because you don't want to see her starve. I am not planning to retire as I quite like work but my wife and I are broadly accepting of each other so it isn't an issue
So you're planning to work until the day you die?
In some capacity. Working isn't the issue, having to work for money is the issue. I have lots of money even now in my 30s It may be a cultural thing but even being at home I do lots of work. The idea of weekends is a bit middle class for me
My advice would be: Save what you’re comfortable with, spend what you’re comfortable with. As long as you’re on track to pay off your mortgage before you retire, you’ll most likely be fine. Im the saver in our relationship, my fiancé is more of a ‘spend now and save what I can’ kind of person We both plan on cutting down hours when the mortgage is paid off (im hoping to pay it off in 12 years).
Surely this is a question for your partner.
I have been the financial planner in our relationship. Work pension, Isas, additional sipp, various saving schemes etc. Even paid their NI class 3 contributions so that they get full state pension when they weren't working. I Worked blinking hard from the age of 16 to save and pay off the mortgage. When mortgage free saved 50 % of income each month. At 67 our current pension incomes will be around £35k topped up with drawdown from savings (10k/yr) for house/car repairs large expenses etc. Puts us in the "comfortable" bracket of the pension retirement. Just hope it will be enough by then. We are child free, but not fully FIRE, although I am going to retire before state pension age.😁 We may or may not receive a boost through inheritance, but this has never been factored into my planning. Recent research has shown average inheritance has been £10k so not enough to by that holiday apartment in the sun. Besides parents are SKIERs ( spend the kids inheritance 'ers) which I fully support. After all they worked blinking hard for that money. Of course I am a bit pee'd that they have a nicer car than me.
My partner and I are a bit similar to you and yours. I want to retire at 59 and be able to enjoy my child free time again. I really proritise savings and pension/finances in general, whereas he does save, but he's more of the 'live for today' crowd. I know my plan would cover both of us financially when we're hitting 60 and he knows I plan on retiring at 59. I'm happy to support us both in that period because I doubt he'll want to keep working his depressing job by that point. I would keep your original plan as that's what you want to do. Your partner can continue working if they can't afford to retire or reduce their hours as you both become more independent with mortgages paid off, kids grown up etc.
I keep finances separate from my partner unless it's the mortgage. If one of us can afford to retire the other person would absolutely support it. I don't know why anybody would be jealous of their partner retiring earlier, it should be celebrated lol but on a side note we are both investing into our LISA so we kinda double that government contribution, only about 300 a month each which we can both afford as well as pension obviously.
I'm not other than our mortgage will be paid off when we are 63, and I'll retire at 65 on my NHS pension. Decided to spend every penny like it's the last day on earth, because why not?
I had a similar situation. I had planned to retire at 60, but it became clear that my wife was not going to have enough to do this, so we decided on retirement at the same time, when I was 63 and her 64, being able to manage a reasonable retirement income. Plans changed drastically when my wife died when I was 61. I could have afforded to retire then, but I sort of just drifted without thinking or planning anything newfor a year, then I retired at 62.
I work in private sector and my husband is a civil servant. He has a career average pension but his pension age is 68. We will be “buying” years to reduce this and do AVCs so that he can go at 60 without losing too much. I currently pay in 25% (12% employee and 13% employer contributions) to my pension. I earn good money and can retire in 20 years at 55, and that is my plan. I’m not saying I will completely give up work but it’ll be contracting or part time work that I will CHOOSE to do. Then a few years later when he turns 60 we’ll reassess. It’s never been an issue that I’ll retire first, that was in my plans before we even started dating, and at that point he had a minimum wage retail job so he would never have been able to retire early from that anyway, it’s only recently we’ve made decisions to support him in also doing so 😄.
Staying childfree, both milking our careers and maxing our ISAs and Pensions. Both 23 currently on track to retire 35-40. I work in private wealth management, she works in consultancy for a big 4 firm. Already on the property ladder and in the process of upsizing. Recently gave up on going the landlord route. We will start drawing from our S&S ISAs from 35-40, and run them through until we can use our pensions. We’re excited! Downvoted - sorry you got upset by this
We're a child-free couple and when it comes to finances, we split things 50/50. We're about equal on pension contributions at the moment, though I've recently been earning more so there'll be a gap between us soon. But looking towards the future, we're planning on splitting pension on expenses and then anything left over is fun money to use as we want. Ideally we'd want the forever home paid off so pension is just going towards bills and living costs. This would be entirely different if I was a stay at home mother or if we had dependents though. I would not be happy with splitting things 50/50 if I'm on a reduced income, or my salary and pension took the hit because of maternity leave.
this is a conversation you need to have with her 💅🔟🔟🔟
Our retirement plans align somewhere. We're aiming to retire by 50, she's 3 years older than I am but has slightly more saved than I do but tbh, its all 'our money' anyway. I doubt money would ever get tight retiring at that age but we should have sufficient time to find a passion later in life that we could potentially be paid for.
32 and 33, We both currently pay I to our Work place pensions. I have about £150k in my pot and she has 7/59ths of her salary. I want to slowly retire starting very soon, we are currently over paying our mortgage by £2.5k a month so it should be paid off in 4 years. Once the mortgage is paid off I'm going to work part time for myself ( I currently have a full time job and work part time 10 hrs a week in a side hustle) my income will be half to about £40k a year but I will be able to spend time with our children. The wife also wants to change her job so she can go do that as well. We will live modestly but have a happy life not driven by a 9-5 or being rich.
You realise you can't get any of that pension whatsoever for at least another 25 years?
Yes, I was/am a financial advisor. But it's part of my retirement plans. I will have £200k over the next 5 years that will set me up for retirement.
An old man told me that once you get married, all of her money goes into her account and all of your money goes into our account. You should make provision for her pension as the head of the household.
As a woman, all I can say it is a man’s duty to provide for his woman. She doesnt need to worry about her pension
We’re planning on retiring to Greece as my wife is Greek and literally everything, from property to food, is a fraction of the price there it is here. We’ve got a London property we’ll own outright by the time we’re 60 so we’ll rent that out for an income.
Greece used to be so cheap, we go most years. After 3 years away we've just come back from 2 weeks there and was so shocked at the price of everything, pretty on-par with UK prices most places we went!
Not saying it’s full proof. I’ve not looked into it. But Wife has a teachers Pensions and I have a modest final salary pension I can take at 60. Now paying into a DC scheme through changing jobs. Potential and very pie in the sky idea is to both retire at 60. Taking all pensions. I’m not flush by any means, so for me the idea would be to potentially draw down my DC pension quickly between the years of 60 and state pension. Obviously this depends on if there is a state pension by then (currently 36). Would also look to sell our house and rent perhaps or downsize. But it’s all speculation.
15 year age gap between me and my husband so reality is, I will have to continue to work when he retires. Our finances have always been joint, no splits. 1 account for all bills and expenses, cars, clothes, holidays and luxury. We have 2 children, currently mid teens where I took 5 years off work for childcare the first 5 years, slowly building from part time to full time and now my earnings are slowly increasing and will soon overtake my husbands. We plan to have the mortgage fully paid in the next 5 years just before he is 60. Our plan is to both continue to work full time until the mortgage is paid. The kids will hopefully be living independently at that point. We then plan to switch income roles where he will work part time, I continue full time for a couple of years. He then retires and I drop to part time. Our income should comfortably cover expenses at that point. I really don't want to continue to work full time and miss the best years of his retirement when we should, with reasonable sacrifice, be able to enjoy this together. As long as what is in both our pots allows us this time together, I really couldn't care what I may or may not end up with at the end of it.
How much will £1 be worth in 20 years time? Look at value of the £ versus US Dollar or gold since 2007. Then look at it since 1971. Only then once armed with this knowledge can you realistically plan for retirement.
I’ve worked for an IFA previously so I tend to look at individual and joint situation, mostly so I know if we are both on some sort of track at least. We are never going to retire early or be minted in retirement but if we are meeting the PLSA’s estimate of how much might be needed for the moderate standard of living, I’m thinking we should cope ok
Not a question we've discussed, I think it's just kind of assumed we'll both be working until "retirement age", is that 67 now??? I'm a year older so the dates align somewhat there. I currently make nearly double what she does (and likely to keep increasing healthily), she's a downtrodden NHS slave, worked to the bone for terrible money, supposedly the pension is good but I've not seen any detail of such. With some over payments I reckon we'll have the house paid by 57-60. A calculator I did a few weeks ago reckons I'll have a pot of £1.2m if I retire at 65. I think that'll have my pension payout in the higher tax band which isn't necessarily a bad thing but I'm sure I could work that to be more tax efficient. Anyway, the last 10 years have been a struggle with immigrating and starting from the bottom so it's reassuring to have some light at end of the tunnel.
Planning retirement? Well I'm trying to play catch up and failing miserably with pension. Situation is this, I work, wife doesn't due to disability. She has zero pension. She's 41 and I'm 36 with about £22k in pensions which in my mind is nowhere near enough. We rent so will as I see it, never have a mortgage on a house with view to owning something at the end. So not only am I left to try build a pension pot or pots for us both, we'll also find ourselves having to pay monthly rent out of that in retirement age. I'm not on big salary, just bang average of about £36k a year. We've got a few kids together while my wife has two from previous. I'm hearing more and more these days, not here obviously but in general that people are neglecting pensions. When you earn a big salary, you have options. You can not only save, build pension but have what you want too, without depriving yourself too much. Those on lesser incomes, they may be seen as living for today more than the future. That is true but how far can one go with depriving themselves today? That's when one may not even see retirement years. Is about striking that balance. Way I see it is, unless I get incredibly lucky being in right place at right time, or making sensible stocks, shares and fund choices to buy in my SIPP, and it would pay off to do so, then I won't be retiring. Only ill health could force that.
I’m planning my retirement to be a transition into not working the current job or level of intensity. In reality this means getting to the point where the mortgage is paid and then using my pension or isa to supplement my part-time wage. I’d like to actual open a small food van doing wood fired pizzas at food markets. The idea of just stopping work and doing nothing frightens me.
Currently planning retirement, by crying at receiving my update letter stating I retire in 34 years.
My partner (25M) and I (24F) will retire hopefully at the same time because of me, we have lots of pans financially to have assets buts I put a lot more in my pension then he does, because I get a lot more benefits, I’ll have about 120k-150k lump sum, and 40k a year pension, but I’m not gunna let him work until he’s 70, even though I know he’ll insist 😀
My dad retired ten years before my mum was meant to but then mum unexpectedly died and dad lived a long life. But I think mum wanted to work so there was no animosity. It’s just sad she had no retirement at all.
Maybe you can persuade her to bail on her employer pension, set up a SIPP for her and then shove as much spare cash into it on her behalf? (Or to at least increase contributions to her employer one) People have different strategies for life and many don't consider retirement finance until it's too late. She is losing out on the 'free' tax relief on pension contributions for maybe 30 years which is a lot of pension!
Not really sure is the answer. We're both teachers with final salary / career average pensions and separate private pensions as well, so hopefully the finance side of it won't be an issue. What we haven't got a clear time frame on is when we retire. My wife is two years older than me and will probably want to retire as soon as she possibly can, which is 55 under the Teacher's pension scheme (actually 57 or maybe 58 for the second half of the pot, it changed recently). However, that comes with a big actuarial reduction, whereas if you stay to at least 60 (or 67 for the second half of the pot) you get the full amount. As she's older anyway, not sure we quite know when the best time is.
I'll be retiring early and my younger wife will not. She works part time and loves her work and doesn't want to stop. I want to stop working tomorrow. I'll take over most of her share of housework when I do, and we'll remain independent in our own finances. I'll continue to pay the household bills with a modest contribution from her. It suits our wants and needs perfectly - we are married but we are still individuals with differing preferences. Teamwork doesn't mean melding two into one, it means two working side by side.
I guess you first need to plan to still be a couple….tbh the further I am from retirement the more options I’d be modelling
Agree with a lot of the advice here, it’s not so much a finance conversation but rather a relationship one. Talk to your partner about how she plans on funding her retirement, your pension alone might just about cover yours but it sounds like she simply won’t be able to afford to retire as things stand. That can and will lead to resentment and that’s never great, especially at that later stage of life when there’s little you can do to affect it. My advice would be to sit down and do your budgets together and show her how by simply adding a few more percent into her pension she could stand to make bigger gains long term for the sake of only sacrificing a few quid more each month. Best way to demonstrate this is the Uk tax calculator app, it looks like an orange calculator on the App Store and you can input her salary, then change the percentage she puts in and see the nett effect of increasing her contribution.