Financial Planning

I wrote to my pension provider a few weeks back to ask how much they predicted my pension would be if I retired at 55 (6 years) or 60 (11 years). In my wildest dreams I am not thinking to still be doing such a high powered job after 60.

To see how life will be affordable I had to be a bit more structured than my usual self.

I downloaded a month of statements from my bank accounts. Updated my monthly budget (no change - I am obviously more on top of this than I give myself credit for). I removed the mortgage, mortgage related insurances, and one of the cars. This gives me how much I need to live exactly as I am now.

Using the age 55 option I can have £67k up front and then a monthly position of about £400 less than current. We would have to be fairly careful but it was doable assuming we have cleared the mortgage by then.

Using the age 60 option I can have £100k up front and would be about £100 per month less well off than now.

Old age pension from the state will kick in at 67 for someone my age. Apparently it will be £150 per week, each, and index linked to keep up with inflation. By 67 I will actually be better off than I am now. Thats actually quite logical as I currently spend about 50% of my salary every month on overpaying my mortgage.

The house we live in here is now almost worth more to rent out monthly than the basic mortgage repayment would be.

Fahed doesn't have a pension at all but mine seems to be enough. He does however have a few investments which should be his pension. He has some building land and a flat in Syria. Obviously I am thinking the value of this might not be very high as they are mid revolution at the moment but who knows, going forward they could be a popular holiday destination!! We have the house in Crete, we have another old house in Crete which we hope to rebuild. We also have enough land around the house to build two more houses but we don't plan to do so. Its good to know we could sell some of the land if things went wrong. I have one more thing I would like to do with property. I have seen a lot of large houses for sale in the Brittany area of France. Locally here you can catch a night boat to that area a lot cheaper than we could also fly to Crete. Checking rental values to purchase costs I find that with a property kept rented for 1/3 of the year then a house would pay for itself in about 8 years. This is fine unless I get like I am with the Crete house where it starts to feel like home and I don't fancy strangers living in it. I think I could be a successful business woman if I wasn't such a Muppet!!

The Plan

I am aiming for 60 unless I am made redundant before then.
We will not buy a pension for Fahed (we should have started years ago and we just didn't have the cash back then).
We will renovate the old house in Crete and market it to bring in a proper annual income.
We may buy another house with the kids (who are now 19 and 21)and rent this place out.
I would like to build, sell and buy more land in Syria because it makes a little cash but also because it is interesting and fun. The sister in law likes searching out good deals and we can employ other family members for the actual work.
I really want to do the Brittany house thing but maybe not until retirement when I can really enjoy it.

I am happy now I have looked at the full picture. It was preying on my mind that things were going to be more bleak.We will be fine and I will pass a degree of financial security on to the kids. We will have some fun and an interesting time but we wont overstretch ourself and give ourselves unnecessary worries.

The only thing I haven't said much about is living with the kids going forward but that is a whole big post on its own so something for another day.